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Systems Thinking: Delivering positive impacts to transform our world

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“The development of systems thinking is crucial for the survival of humanity”. So claims John Sterman, professor of management at MIT and director of the MIT Systems Dynamics Group. As a designer working at the coal face of sustainable design and innovation, I believe he is right and, in this article, I will explain why.

What is the meaning of systems thinking?

Donella Meadows, a pioneer in systems thinking, defined a system as a set of things interacting in a way that produces something greater than the sum of its parts. These parts must be interrelated and interdependent in some way. Otherwise, they would simply be a collection of parts. Systems range in complexity; from a car, which is relatively simple and easy to diagnose if something goes wrong, to natural ecosystems such as a tropical rainforest containing living and nonliving components that we are only just beginning to understand how they work (Megan K Seibert, 2018).

What are system characteristics?

According to Daniel H Kim (1999), systems have the following defining characteristics:

  • The purpose of a system is defined by the sum of the parts, and not the parts alone. The purpose of a car ‘as a whole’ is to transport people. However, this is not the purpose of the wheels.
  • All constituent parts must be present for the system to deliver against its purpose. If you take the car apart it is no longer a car, as it has lost its essential functions.
  • The arrangement and order of the parts in a system matters and impacts the performance. A car would not function if the engine was not connected to the drivetrain that in turn is connected to the wheels.
  • It is the collective interactions between the parts that dictate the behaviour of the system. Feedback is the transmission and return of information. If a car is being steered into a turn too quickly, the driver will feel resistance through the steering wheel or even the stability of the car itself.

Who invented systems thinking?

The term ‘systems thinking’ was first used by Barry Richmond, an American systems scientist, in 1987. However, experts in the fields of biology, mathematics and computer science began thinking in systems at the turn of the 20th century and by the mid 1960s, systems theory (or systems dynamics as it is also referred to) was being widely applied to many other fields including sociology, psychology and business management (Anastasia Vikhornova, 2018).

Since then, systems thinking has been applied to the development of contemporary business, supply chain and digital ecosystems. Jay W. Forrester was prominent in developing systems dynamics theory at MIT in the late 60s and early 70s, Donella Meadows kickstarted the debate about the Earth’s capacity to maintain human expansion in the 80s, and Peter Senge’s seminal 1990 management book, The Fifth Discipline, paved the way for businesses and how they can leverage systems thinking and transition to adaptive learning organisations.

Today, systems thinking is more important than ever as we find ourselves facing several existential crises. The dramatic increase in human activity over the past seventy years, also known as the great acceleration, has negatively impacted the planet through climate change, a reduction in biodiversity and the depletion of natural resources.

Simultaneously, social inequality negatively impacts more than 70% of the world’s population and is hampering social and economic development, according to the UN. And finally, the advance in information and communication technologies (ICT) has resulted in a fundamental restructuring of the world from, generally speaking, simple linear cause and effect to complex, ever-changing circular systems with reinforcing causal loops.

How does systems thinking affect your life?

Our continued inability to recognise the consequences of our actions has left us in a precarious situation. As Anthony Hodgson explains in his book, Systems Thinking for a Turbulent World (2020).

With the world creaking at the seams – 7.6 billion people trying to survive and progress on a piece of rock with dwindling resources – primary and secondary industries that include building, fashion, consumer goods and electronics are facing similar challenges. How can we reinstate flow and make a positive impact?

Unfortunately, we haven’t been that successful to date. In the majority of cases, we have approached these 21st century challenges in the same way we have done in previous centuries… through a reductionist viewpoint of breaking things down into separate parts. This has not worked because we face inherent wicked problems with many interdependent factors that are often difficult to define and in flux, making them seem impossible to solve – according to the Interaction Design Foundation – and solving them requires a deeper understanding of the factors and the stakeholders involved.

The metaphor often used in systems thinking is that of the iceberg.

If we look at the tip of an iceberg, we can see the effect of the system – the resulting event – but not the cause. Only by looking below the surface of the water can we identify the root causes of this event by studying and mapping the underlying structure of the system and identifying the patterns and trends resulting from the respective interconnections.

Looking at these problems and trying to make sense of them in isolation is therefore no longer viable. Systems thinking encourages us to look at how things work as an interconnected whole. This is why many designers, innovators, businesses and organisations are turning to this more holistic approach in order to unlock our current predicament.

Joi Ito and Jeff Howe pointed out in their 2015 book Whiplash, that “the world needs a deeper fundamental shift – an entirely new mode of thinking cognitive evolution on the scale of a quadruped learning to stand on its hind two feet.” Only this shift in mindset will help us overcome the global issues we face by implementing systemic change.

The good news is that there are examples of design-driven systemic change. These are led by people who are able to make sense of and thrive off the uncertainty that comes with complex challenges (Beyond Net Zero, Design Council 2021). At 1HQ, we are also working on some of these challenges.

Sustainable packaging systems

Packaging waste is one of the wicked problems we face. There has been an explosion in the development of alternatives to a much-maligned incumbent, plastic. These include swapping plastic for paper or a return to glass and metal. Many are recyclable and use recycled content. Many are beautifully designed and visually appealing to brands and consumers alike. But they do not address the problem because, in many cases, they are just more of the same.

We will still consume the packaging once and then discard it. Recycling is hit and miss, to say the least. In Britain, we recycle in the belief that the single use paper, plastic, glass and metal we separate will become new packs yet there is increasing evidence that much of this still ends up in landfill, only halfway around the world. The failure in adoption of plant based plastic such as PLAs was not applying systems thinking around the broader context of impact. It has taken several years and a huge amount of wasted investment to realise that developing materials that ‘disappear’ after a single use is not a feasible solution without putting in place the required infrastructure.

The packaging waste crisis will not be solved by simply changing substrates; this is piecemeal. Doing the same thing over and over yet expecting a different result is a definition of insanity, as Einstein allegedly said. Systemic change is required at a more fundamental level that reconfigures not just how packaging is produced but how it is supplied, how it is consumed, how it is recovered and then either reused or regenerated.

This means looking at the system as a whole and re-imagining the relationship between components such as the individual packs and channels of access, and stakeholders such as consumers, brands and retailers.

We wanted a silver bullet for single use but have finally come to understand that circularity is the answer with different executions for different scenarios, such as at home and on the go. Where possible, the conversion of packaging into reuse systems has been identified as crucial in the quest to reduce waste. Benefits include a reduction in annual material costs, energy consumption and CO2 emissions according to the Ellen MacArthur Foundation. To successfully drive adoption of a reuse behaviour however, consumers need to be incentivised and rewarded which requires a more desirable value exchange from that offered today by single use behaviour.

One such example of this is Loop. Initiated by Terracyle in partnership with consumer goods companies and retailers, Loop has resuscitated the traditional milkman model to offer a reuse packaging system by delivering consumer goods and picking up empties at the same time. Loop rewards consumers through convenience and better performing packaging, and brands by doing the hard work of selling and delivering the goods then collecting and washing the packaging so it can be refilled.

Systemic innovation ecosystems

Design thinking has been the guiding light of innovation over the past twenty years. It has formalised designers’ natural propensity to centre problem solving around people and craft, and prototype iteratively as a structured innovation process across multiple disciplines; industrial design, service design and interactive design in particular.

However, innovation is increasingly lost in translation as businesses struggle to convert insights and ideas into successful product launches. In some cases, this is because implementation reverts back to legacy processes and siloed development that ultimately strips away the uniqueness of the solution (Jeffrey Tjendra, 2018).

There is another reason though; a failure to anticipate how that solution might ultimately perform in constantly changing marketplaces and embed adaptability so that businesses can launch, learn and respond accordingly. The convergence of physical and digital technologies means that all industries, from FMCG and food to beauty and health, are being radically transformed with multiple factors to consider.

Systems thinking offers new approaches to innovation that augments design thinking with an overarching bigger picture perspective, and a transition from only looking at the objects in a system to a wider focus on the interactions and flows of that system.

Innovation is no longer linear; it is circular and multi-dimensional. Pipelines can no longer simply comprise a collection of independent products that exist in isolation; one size no longer fits all. Rather, they should bring together products that perform different roles as part of a broader innovation ecosystem. One where the synergy and sum of these parts becomes greater than the whole, and where ongoing feedback loops inform their continual adaptation and optimisation. Paradigms will be shifted, and experiences reimagined over the coming years.

An example of systemised innovation is Tesla. While Tesla makes electric cars, it doesn’t focus its innovation solely on the car and batteries. One of the barriers to electric car uptake is range, so Tesla is also building a global charging network for its cars so that large distances can be driven with the confidence that a suitable location to recharge is never far away. Tesla looks at the entire vehicle system and addresses all the core driving needs of their consumers – in and out of the car – to offer a frictionless experience. (Bhargava, Boehm and Parker, 2021).

Inclusive brand ecosystems

Brands have been building ecosystems for years comprising different services, channels and touchpoints to remove complexity from and deliver consistency in consumers’ experiences. Amazon famously puts the success of the ecosystem – including the suppliers who support it – ahead of the success of its services (Michael G Jacobides, 2019); something that has resulted in an incredibly high penetration of consumers being retained and an equally high bottom line.

However, a brand can no longer simply focus on its bottom line; there is an increasing drive for brands to build ecosystems that also focus on supporting people and protecting the environment.

The term triple line is gaining traction amongst forward thinking brands and businesses as it places an equal weighting on social, environmental and financial concerns.

These businesses are evolving to address societal and environmental challenges in a holistic way without negatively impacting economic progress; what the Future Fit Foundation refers to as ‘system value’. They provide a system lens to help businesses rethink the triple bottom line.

And brands and businesses that put sustainable purpose at their core are now said to be outperforming those that don’t. IKEA is a brand leading the charge here. They believe in balancing economic growth with positive social impact and environmental protection and renewal, and their overall mission is to meet the needs of people today without compromising the needs of future generations. They are prepared to walk the talk too…They have set an ambitious target of 2030 to become a leader in creating and maintaining a fair and equal society, transform to a circular business that promotes circular and sustainable consumption, become climate positive and regenerate all resources.

Triple bottom line

Systems thinking has the power to transform our approach to the global challenges we face and make a positive contribution through the solutions we develop.

Another example of the evolving brand ecosystem is the shift from competition to collaboration between some businesses. If we are to make the necessary breakthroughs, knowledge must also be shared between brands and built upon rather than ring fenced and protected. Some forward-thinking brands are even open sourcing their learning from sustainable business practices; they can move faster together rather than alone by sharing research and expertise according to the JWT Regeneration report released earlier this year. McDonald’s and Starbucks have joined forces as part of the NextGen Cup Consortium to resolve the 600 billion coffee cups they estimate end up in landfill.

This requires us to look at the bigger picture and identify the root causes of the wicked problems we face, not just those on the surface. To synthesise the different perspectives and needs of all stakeholders while making connections with emergent enabling technologies. To be pioneering and create a shared vision that benefits and rewards us all, equally. To work collaboratively and respectfully across disciplines so that we can realise and deliver this vision together. Above all, to recognise that the systems we develop will need to be dynamic and resilient, so they can evolve, adapt and grow to be truly sustainable.

We must do all these things now. As Jony Ive of Apple fame recently said, “this is not the time to seek the comfortable familiarity of the past, but rather to build and make something new” – a very appropriate clarion call.

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Magazine

Content includes:

Systems Thinking: transforming our world to become sustainable
Making collaborative contributions through design-driven systemic change.

Inviting social to the table
How social media can become an extension of the wider brand world.

Design Vs Systems Thinking
The greatest challenge for contemporary creatives.

The Italian Job
A Data Scientist view on self-tracking.

Systems 1 Thinking. What marketeers should know
Helping to differentiate through a relevant and emotionally connected brand positioning.


ISSUE 13

All Systems Go.

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