systems thinking for managers

Systems Thinking In Management: Why And How To Adopt

The way managers think is of massive consequence. After all, their thoughts turn into actions that take teams forward. While the importance of critical thinking and analytical thinking for managers needs no repetition, several mental models can significantly help managers and leaders at work. In this blog post, we’ll introduce systems thinking and explain why managers should adopt the approach at work. We’ll also provide an example of systems thinking in action and show you how to use the system modeling approach to manage your team effectively. So take a look, and let systems thinking help you manage complex systems at work in a way that benefits everyone involved!

What Is Systems Thinking?

The systems thinking leadership institute defines it as a management discipline that concerns an understanding of a system by examining the linkages and interactions between the components that comprise the entirety of that defined system. It is not merely about the tools or techniques but an underlying philosophy emphasizing the interconnectedness of the world we work in. It helps us visualize the interconnections of disparate entities.

It helps in drawing the big picture – with complete analysis and understanding of the design of the structure and flow of the organization as composed of many interconnected sub-systems.

That sounds complex! In simple words, systems thinking is a way of looking at problems and developing more efficient solutions. It can help managers identify causes and patterns, thereby making decisions faster and with less error. Implementing this way of thinking in your workplace will help you achieve goals, facilitate smoother communication, and enable innovative problem-solving and decision-making.

What is an Example of Systems Thinking?

At work, systems thinking is critical to making informed decisions and problem-solving. By breaking down an entire system, or organization, into its parts, it allows managers to understand the dynamics of the system and its interactions. This process can help managers make better decisions and solve problems more efficiently. In fact, by using systems thinking in the workplace, managers can help their team become more effective and efficient.

A great example of systems thinking comes from the search engine giant Google. As their company grew from two people to thousands, they began seeing the whole world as a part of their ecosystem. With this vision, their investments crossed the scope of people and began to cover renewable energy. As a significant consumer of energy, google identified it as a part of their system and created connections back to it. This move helps them in many ways, it improves their brand equity and creates a better world for everyone to inhabit – leading to a win-win situation!

Why Do We Need Systems Thinking In Our Work?

As we have understood so far, systems thinking helps us visualize complex wholes. Managers are often dealing with multiple challenges, and more often than not, many of them are interrelated. When a manager begins to build solutions piece by piece, they are bound to run into many problems. First, their solutions might be misaligned and counterproductive. It means that solving the first problem will worsen the second, unfortunately. Secondly, it will consume a lot of time and effort. Systems thinking solves both of these issues. Here is why you should use systems thinking in your teams –

Get the big picture

First, systems thinking lets managers see the entire problem and its solutions holistically. It allows them to make better decisions quickly. In fact, it is said that a good chunk of business wisdom comes from wholeness analysis – breaking down significant problems into manageable pieces so that we can take action on them.

Secondly, when you use systems thinking in your work, you can easily navigate complex challenges. Instead of constantly stumbling around in the dark, using systems thinking will give you a clear map and guide for moving forward. Additionally, this mindset can help you to see potential opportunities even when they are not immediately apparent.

Save time and effort in solving problems

Systems thinking helps manage time and resources more effectively. Simply put, by understanding the entire problem, you will be able to see how all of the pieces fit together. Furthermore, because you are using a systems approach, you can develop solutions that take into account other aspects of the problem as well. It is a massive advantage since it prevents wasting time on tasks that are not actually necessary.

A systems thinking approach empowers you to envisage robust solutions that solve multiple problems. It is a roadmap to more intelligent decision-making and problem-solving for managers and leaders.

Minimize second-order impacts

When you use systems thinking approach to problem-solving, you minimize the chances of creating second-order impacts. In other words, by understanding the big picture and considering all aspects of a situation, you reduce any unintended consequences arising from your actions or decisions.

For example, suppose you are trying to decide whether or not to fire someone on your team. When using the systems thinking approach, it is possible to consider all the potential ramifications – good and bad – before making a decision. It will help prevent any negative fallout after firing someone and ensure everyone involved is on the same page.

You can stay organized and make better decisions despite distractions by breaking down complex problems into manageable pieces. In addition, by understanding how all elements work together, you can anticipate potential challenges before they occur and plan for possible solutions.

Build a shared vision

When everyone on a team works towards the same goal, everything becomes more accessible. By developing and sharing a common vision, teams can work together more effectively and achieve collective success. Using tools of the systems thinking method is a great way to develop shared ideas and roadmaps. It is because each team member understands what they are working towards and knows how their actions contribute to the overall goal.

A systems thinking approach can help you clearly understand your company’s mission, goals, and objectives. In addition, by specifying measurable targets, you can ensure that everyone on your team knows exactly what needs to be accomplished for the organization to succeed.

Tell your story with the system

When describing your company or product, it is essential to use the system methodology. By creating a model of how the system works, you can provide information that is easy to understand and provides clarity for potential customers and other team members. It will help them make informed decisions about what products they want to buy and keep them up-to-date on changes or new developments in your industry.

Using systems thinking techniques throughout your business processes and marketing efforts, you can create a compelling story that binds your team with its plans and strategies. It may be a surprise, but the systems thinking approach is a great way to unify team communication.

Lastly, systems thinking is a powerful tool that managers can use to create a better world for everyone. When we work together as system thinkers, we can come up with solutions that benefit more than just ourselves. Systems thinking creates win-win situations where everybody benefits, including the environment and animals!

system thinking

How to use systems thinking in your teams?

There are a few ways that you can use systems thinking in your teams. One way is to identify the different parts of the system and then ask yourself questions about how each part functions. For example, if you’re a salesperson, you might ask yourself questions like:

  • How does my target market behave?
  • What type of objections do my potential customers raise?
  • How can I best reach these buyers with my products or services?
After you have learned a few basics about your system, you can begin by drawing a causal loop diagram that captures the entirety of your situation. There is no right or wrong way to do this; you just need to focus on the story your diagram depicts.

Another tool that you can use is the Archetype. It is used to explain patterns of behavior. For instance, managers can use this tool to classify their team members. Similarly, HR professionals can use it to classify their team members. Managers of sales teams can use it to understand and explain their target audience segments. Once you have begun, you can learn more about the tools and techniques of systems thinking and adapt them to your team’s needs.


In today’s fast-paced world, systems thinking is a critical tool that managers can use to keep their businesses running smoothly. By understanding how systems work and interact, managers can identify problems early and take the appropriate steps to fix them. Systems thinking is not a complex process, but it does require some effort on the part of the manager to understand the concepts and apply them in the workplace. If you’re a manager who wants to grow, read our blogs for more information on management and leadership. 

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What is an example of systems thinking in management?

An example of systems thinking in management is analyzing the interactions and interdependencies between different departments or teams within a company to identify potential areas for optimization and improvement in the overall workflow and productivity of the organization.

Why is systems thinking important for leaders?

Systems thinking is important for leaders because it enables them to view problems and opportunities holistically, identify root causes, and develop effective strategies to optimize complex systems and processes.

What is the key concept of system thinking?

The key concept of system thinking is that a system is composed of interrelated and interdependent parts, and understanding the relationships and interactions between these parts is essential for effective problem-solving and decision-making.

What are the key skills required for system thinking?

Key skills required for systems thinking include:
1. Identifying patterns and relationships within complex systems.
2. Thinking critically and creatively.
3. Communicating effectively.
4. Analyzing data.
5. Recognizing the impact of feedback and delays on the system’s behavior.

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