Systems Causal Loops

7/28/2019 Systems Causal Loops

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Introduction to Systems

Thinking and Causal Loops

Todd Little



THE FIVE DISCIPLINES

LEARNING ORGANIZATIONS

Team

Learning

Personal

Mastery

Mental

Models

Shared

Vision

Systems

Thinking



• Management intervention for Cause-Effect

•Mitigate the Effect (Fire-Fight)

•Eliminate the Cause (Better not happen again)

•Run Away (and hide)

• Universe is a machine • Analytic method leads to reductionism

• Very effective when change is slow

MECHANISTIC VIEW

CAUSE EFFECT



MECHANISTIC

EXTRAPOLATION

0

100

200

300

400

500

600

700

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

R e v e n u e



• Focusing on principle of organization, particularly

interdependent relationships

• Dealing with detail complexity and dynamic

complexity

• Seeing processes of change rather than

snapshots

SYSTEMS VIEW



WHAT IS A SYSTEM?

• A collection of people and/or parts

which interact with each other to

function as a whole



SYSTEM INTEGRITY

Dividing a cow in half does not give you two smaller cows



WHY A SYSTEMS PERSPECTIVE?

Problems facing us are more complex due to

increase in

• information flow

• interdependencies

• rate of change

Facilitates leadership by leveraged action

• integrating competing priorities

• acknowledging and handling unintendedconsequences



“The significant problems we face today

cannot be solved at the same level of thinking at which they were created.”

- Albert Einstein



Examining how

WE CREATE OUR OWN PROBLEMS

Seeing the

BIG PICTURE

Recognizing that

STRUCTURE INFLUENCES PERFORMANCE

WHAT IS SYSTEMS THINKING?



ASPECTS OF STRUCTURE

Events

Patterns

Structure

Crises

Tasks

Trends

Reward Systems

Unwritten Rules

People’s Mental Models

Fire-fighting

Anticipating

Designing



ActionMode

TimeOrientation

Way of Perceiving

Questions to Ask

Events React! Present Witness

event

What's the

fastest way toreact?

Patterns Adapt! Measureor trackpatterns

of events

What trendsseem to berecurring?

Structure CreateChan e!

Future SystemsThinking

Whatstructures arein placecausing these

patterns?

EVENTS, PATTERNS, AND STRUCTURE



Causal Loop Diagrams - a useful way to

represent dynamic interrelationships

• Provide a visual representation with which to

communicate that understanding

• Make explicit one's understanding of a systemstructure - Capture the mental model

SYSTEMS THINKING TOOLS



Employee

Performance

Supervisor’s Supportive

Behavior

Unsupportive

Behavior

Structure

S

S

REINFORCING LOOP

Perf.Level

Time

Behavior Over Time

SupportiveBehavior

Employee

Performance

Supervisor’s

Supportive

Behavior





• A class of tools that capture the "common

stories” in systems thinking

• Powerful tools for diagnosing problems and

identifying high leverage interventions that

creates fundamental change

SYSTEMS ARCHETYPES



• Drifting Goals• Escalation

• Fixes that Fail / Backfire

• Growth and Underinvestment

• Limits to Success

• Shifting the Burden / Addiction• Success to the Successful

• Tragedy of the Commons

SYSTEMS ARCHETYPES



FIXES THAT FAIL / BACKFIRE

Unintended

Consequences

FixProblem

Symptom

Delay

SS

S

O

Time

Behavior Over Time



Dilbert Learns Causal Loops



THE SOFTWARE BUG FIX

Incentive to

Write Software

with Bugs

Reward for Fixing

Software Bugs

Number of

Bugs in Software

SS

S

O



Fixes that Fail

• Breaking a “Fixes that Fail” cycle usually

requires two actions: acknowledging that the

fix is merely alleviating a symptom, andmaking a commitment to solve the real

problem now.

• A two pronged attack of applying the fix and

planning out the fundamental solution willhelp ensure that you don’t get caught in a

perpetual cycle of solving yesterdays

“solutions”



Drifting Goals

Goal Pressure to

Lower Goal

Gap

Corrective Action Actual

SS

O

SO

S

Delay

Time

Goal



THE BOILED FROG

• If you put a frog in boiling water, it will

hop out immediately

• If you put a frog in cold water and slowlybring the water to boil, the frog will

unwittingly enjoy its last blissful warm

bath



THE BOILED FROG

Perceived Desired

TemperatureTolerance for

Temperature

Temperature

Gap

Hop Out

Time

TempS

S

O

S

O



Drifting Goals

• Drifting performance figures are indicators

that the “Drifting Goals” archetype is at work

and that real corrective actions are not beingtaken.

• Understand how goals are set



Success to the Successful

Allocation to A

Instead of B

Success of A

Resources

to A

Resources

to B

Success of B

Time

A

Time

BS

S

SS

S

S




• Look for reasons why the system was set up

to create just one “winner”

• Find ways to make teams collaborators rather than competitors




NIH Syndrome

Desire to redo

vs. desire to reuse

Confidence in

Ability to redo

Amount of

redo

Amount of

reuse

Success of reuse

Time

R e d o

Time

R

e u s e

S

S

SS

S

S



Positive

Reinforcement

Structure

Perf.Level

Time

Behavior Over Time

Hours

Worked

EnergyLevel

Diminishing

Returns

“Burnout”

EmployeePerformance

Supervisor’s

SupportiveBehavior

S

S

S

O

S

Limits to Success



Potential

Customers

Market Exposure

to Potential

Customers

Sales

S

S

O

S

Limits to Sales Success

Market

Size

S





Legal Disclaimer

• The following is fiction.

• Any resemblance to any leading oil &

gas software development company ispurely coincidental.



New Sales

1980 1985 1990 1995 2000 2005 2010



Total Customers

1980 1985 1990 1995 2000 2005 2010





Systems Dynamics Models

PotentialCustomers

Customers

sales

non customer contacts

CONTACT RATE

customer prevalence

total market

customer with noncustomer contacts

SALES FRACTION

INITIAL CUSTOMERS

Ex-Customers



1980 1985 1990 1995 2000 2005 2010

#Customers

#Active Customers



1980 1985 1990 1995 2000 2005 2010

Total Pot Rev

Actual Revenue

#Customers

#Active Customers



Tragedy of the Commons




Total ActivityGain per

Individual

Activity

ResourceLimit

O

S

S

STime

A

Time

B

A’s Activity

Net Gains

for AS

S

B’s Activity

Net Gains

for B

S

S

S

S



Tragedy of Integration

Investment

in Integration

Perceived

Success from

Integration

S

O

O

Time

A

Time

B

Investment

in features

S

S

S

S

O

O

Success from

Product

Investment

Success from

Product

Investment

Investment

in features

Fixed

Budget

Fixed

Budget

Investment

in Integration

DELAY

S

S




• Solutions for a “Tragedy of the Commons” never

lie at the individual level (The Libertarian Nightmare)

• What are the incentives for individuals to persistin their actions?

• Can the long-term collective loss be made more

real?

• Find ways to reconcile short-term individual

rewards with long-term cumulative

consequences



Software Integration

Level of

Integration

Customer demand

for Integration

ISG push

of Integration

SS

O

S

LandmarkMarketing

VisionS

ISG Interest

in Integration

IPG Interest

in Integration

Investment in

Integration

S

SS

S



Software Integration

Success from

Interest in

Integration

Success from

Integration

SS

O

O

S

Investment

in Integration

Investment

in features

Frustration

with Dependencies

and Legacy Integration

S

O

•Limits to Growth

•Success to the

Successful

Documents

Systems Causal Loops