Systems Thinking and the New Economic Age

The Change in Thinking video really was a foundation for a larger claim about a new economy, a new society. But to the extent that it stood alone, its points were largely as follows.

1. Reductionist thinking was not something abstract that stayed in books. Applied to the real world of work and commerce, it gave the distinctions that fed division of labor and even the way we approached institutions: we built institutions for learning and work and play, separating into different domains the most essential elements of being human.

2. Reductionist thinking turns our focus inwards - towards the pieces of a problem. By contrast, systems thinking focuses us on the relationships between those pieces. Most of the really interesting problems we face today defy reductionist thinking - defy problem solving that focuses on a part. We created this modern world by applying the reductionist way of thinking. We can't hope to transform it by reliance on the same.

3. To illustrate the extent to which reductionist thinking has been conflated with thinking, I offer the Monty Hall Paradox. Simply put, reductionist thinking with its focus on the parts misses most of the problem. By contrast, focusing on the relationships - even with the card we tend to ignore - is the essence of systems thinking. Focus on the relationship rather than the two "closed" doors (or cards) is twice as effective.

4. Leaders need to begin introducing the elements of systems thinking into their organization. Our world is full of systems. Introducing new methods of thinking, consciously creating intellectual capital, and challenging our defaults in perception and problem framing are essential to dealing with all the truly interesting problems.

This particular video was meant to be a set up to a video explaining the new economic age, an age that will transform the corporation as the Enlightenment transformed the nation-state, or the Renaissance transformed the church. To see what larger framework this fits into, you can go to this post from August - The 4th Economy.

Basically, systems thinking is going to be an essential part of the coming transformation. Our really important problems have little regard for national boundaries or institutions that pretend to neatly parse the experiences of being human or regional effects. A job in Michigan might depend on economic conditions in Europe or the value of the dollar. Floods in Southeast Asia might be exacerbated by carbon emissions in the U.S. Problems in manufacturing might have little to do with manufacturing and everything to do with the approach to design. Most of our problems came out of an over reliance upon reductionist thinking and won't be solved by continued reliance upon this view that, at its core, insists that the world can be as neatly fragmented as an orange.

Our founding fathers had adopted a new way of thinking. They were men of the Enlightenment, a revolutionary and different way of thinking in its time. In our own time, we need leaders who not only adopt this new way of thinking but are able to create new experiences that help others to appreciate systems. For those paying attention, I think that the world is already offering such experiences in abundance. Seeing them simply requires a change in thinking.