Systems Thinking & Decision Making

System thinking and decision making is a very important part of organizational development and change. However, people tend to see just the problem in front of them rather than seeing the whole picture. This can result in not being able to see the effects a decision can have later or on another aspect to the organization or system involved. Being able to use systems thinking in decision-making can assist us in being able to look at every aspect fully and make a more informed decision.

Systems thinking isn’t just about the bigger picture or making a decision. It is the entire system of the organization that is all connected to form a whole. These can include the culture, structure, processes, human aspects, organizational learning, data collecting, analysis, and more.

Peter Senge (1990) explains it best when he states “Systems thinking is a method for seeing wholes. It is a system for seeing interrelationships as opposed to things, for seeing the progress of change rather than depictions of them. It is a set of general principles refined through the span of the twentieth century… Furthermore, systems thinking is a reasonableness for the nuanced connection that gives living systems their unique character. Today systems thinking is needed more than ever because we are becoming overwhelmed by complexity.” (Senge, 1990).

Learning is crucial for any organization, especially from a system thinking and decision-making standpoint. Decision-making helps to implement change and adapt to them within the system by providing the data and tools needed to make a better-informed decision on what method, model, or approach to take in change efforts. Due to this and the need to understand the system it is important to implement learning at all levels. Learning can have various levels of knowledge and learning implemented – individual learning, team learning, and organizational learning.

Christopher Chan (2002) posits there can be benefits of an individual, team, and organizational learning on competitive advantage. At the individual level, the organization can benefit from improved performance due to their willingness to learn, adapt, rectify mistakes they learn from, and a desire for mastery from a higher learning individual. At the team level, many benefits can be brought forth to the organization due to the cohesive knowledge, skills, and experience being shared amongst the team. At the organizational level, the knowledge, skills, and experience gained at the individual level and team level can contribute to the organizational level of learning. (Chan, 2002).

In this respect, learning can be highly beneficial, especially to a learning organization and organizational learning. A competitive advantage that can be obtained is the ability for teams to work on projects and secondary projects due to the entirety of individuals’ knowledge and skills in that specific area. For example, Organization Acme needs to create a product for Wile E. Coyotl. There are various teams that know different aspects of making the product and are able to combine their skills and knowledge to create and produce the product requested. A group was brought together with these various skills in order to combine their cohesive input into a finished product. However, in the meantime, B. B. Roadrunner has also requested a new product be created and produced for him. You wouldn’t want your first team to try to work on multitasking their projects because it can decrease productivity. Thus, you would create a second team to use their skills and knowledge to create and produce the second project. Due to the two teams working on different projects they can then teach others various aspects and skills they’ve learned in the process of their experience. This can help the organization to gain a competitive advantage due to the newer skills, experience, and knowledge that other organizations may not have.

Both, practitioner and academic, literature is very important because they both provide a view of knowledge through experience as well as academic standpoints. An organization can benefit from learning skills and through experience, but the same organization can also benefit from learning academic views. This can allow them to obtain new ideas to solve problems and improve their decision-making with the new information they have accumulated. Without practitioner literature and experience the academics can’t have the knowledge gleaned from such to base their research on. Without the academics, the practitioners wouldn’t have the research and testing performed to assist them in developing new ideas to use in their practice. Some academic ideas can be improbable, but some practitioner ideas can be unscientific. Combining the two can be beneficial to organizational learning as well as future projects a company may have.