We have stated several times that the practice of system dynamics improves leadership. Peter Senge's writings discuss why this is so...
In his paper entitled, "The Leader's New Work: Building Learning Organizations," Senge argues that "systems thinking" is one of the "critical areas of skills (disciplines)" that "embody the principles and practices that can widely foster leadership development.." Discussing the "systems thinking skill (discipline)", he goes on to say...
"We all know that leaders should help people see the big picture. But the actual skills whereby leaders are supposed to achieve this are not well understood. In my experience, successful leaders often are "systems thinkers" to a considerable extent. They focus less on day-to-day events and more on underlying trends and forces of change. But they do this almost completely intuitively. The consequence is that they are often unable to explain their intuitions to others and feel frustrated that others cannot see the world the way they do.
"One of the most significant developments in management science today is the gradual coalescence of managerial systems thinking as a field of study and practice. This field suggests some key skills for future leaders:
Seeing Interrelationships, Not Things, and Processes, Not Snapshots. Most of us have been conditioned throughout our lives to focus on things and to see the world in static images. This leads us to linear explanations of systemic phenomenon. For instance, in an arms race each party is convinced that the other is the cause of the problems. They react to each new move as an isolated event, not as part of a process. So long as they fail to see the interrelationships of these actions, they are trapped.
Moving Beyond Blame. We tend to blame each other or outside circumstances for our problems. But it is poorly designed systems, not incompetent or unmotivated individuals, that cause most organizational problems. Systems thinking shows us that there is no outside - that you and the cause of your problems are part of a single system.
Distinguishing Detail Complexity from Dynamic Complexity. Some types of complexity are more important strategically than others. Detail complexity arises when there are many variables. Dynamic complexity arises when cause and effect are distant in time and space, and when the consequences over time of interventions are subtle and not obvious to many participants in the system. The leverage in most management situations lies in understanding dynamic complexity, not detail complexity.
Focusing on Areas of High Leverage. Some have called systems thinking the 'new dismal science' because it teaches that most obvious solutions don't work - at best, they improve matters in the short run, only to make things worse in the long run. But there is another side to the story. Systems thinking also shows that small, well-focused actions can produce significant, enduring improvements, if they are in the right place. Systems thinkers refer to this idea as the principle of 'leverage.' Tackling a difficult problem is often a matter of seeing where the high leverage lies, where a change - with a minimum of effort - would lead to lasting, significant improvement.
Avoiding symptomatic solutions. The pressures to intervene in management systems that are going awry can be overwhelming. Unfortunately, given the linear thinking that predominates in most organizations, interventions usually focus on symptomatic fixes, not underlying causes. This results in only temporary relief, and it tends to create still more pressures later on for further, low-leverage intervention. If leaders acquiesce to these pressures, they can be sucked into an endless spiral of increasing intervention. Sometimes the most difficult leadership acts are to refrain from intervening through popular quick fixes and to keep the pressure on everyone to identify more enduring solutions.
"While leaders who can articulate systemic explanation are rare, those who can will leave their stamp on an organization....
"The consequences of leaders who lack systems thinking skills can be devastating. Many charismatic leaders manager almost exclusively at the level of events. They deal in visions and in crises, and little in between. Under their leadership, an organization hurtles from crisis to crisis. Eventually, the worldview of people in the organization becomes dominated by events and reactiveness. Many, especially those who are deeply committed, become burned out. Eventually, cynicism comes to pervade the organization. People have no control over their time, let alone their destiny.
"Similar problems arise with the 'visionary strategist,' the leader with vision who sees both patterns of change and events. This leader is better prepared to manage change. He or she can explain strategies in terms of emerging trends, and thereby foster a climate that is less reactive. But such leaders still impart a responsive orientation rather than a generative one.
"Many talented leaders have rich, highly systemic intuitions but cannot explain those intuitions to others. Ironically, they often end up being authoritarian leaders, even if they don't want to, because only they see the decisions that need to be made. They are unable to conceptualize their strategic insights so that these can become public knowledge, open to challenge and further improvement."
Senge continues to describe what systems thinking has to do with leadership in his book, The Fifth Discipline (1990), focusing here on how systems thinking can help a leader learn to make her intuitions explicable....
"Systems thinking may hold a key to integrating reason and intuition. Intuition eludes the grasp of linear thinking, with its exclusive emphasis on cause and effect that are close in time and space. The result is that most of our intuitions don't make 'sense' - that is, they can't be explained in terms of linear logic.
And essentially repeating the last paragraph quoted from his paper above...
"Very often, experienced managers have rich intuitions about complex systems, which they cannot explain. Their intuitions tell them that cause and effect are not close in time and space, that obvious solutions will produce more harm than good, and that short-term fixes produce long-term problems. But they cannot explain their ideas in simple linear cause-effect language. They end up saying, 'Just do it this way. It will work.'
"For example, many managers sense the dangers of eroding goals or standards but cannot fully explain how they create a reinforcing tendency to underinvest and a self-fulfilling prophecy of underrealized market growth. Or, managers may feel that they are focusing on tangible, easily measured indicators of performance and masking deeper problems, and even exacerbating these problems. But they cannot explain convincingly why these are the wrong performance indicators or how alternatives might produce improved results. Both of these intuitions can be explained when the underlying systemic structures are understood.
"The conflict between intuition and linear, nonsystematic thinking has planted the seed that rationality itself is opposed to intuition. This view is demonstrably false if we consider the synergy of reason and intuition that characterizes virtually all great thinkers. Einstein said, 'I never discovered anything with my rational mind.' He once described how he discovered the principle of relativity by imagining himself traveling on a light beam. Yet, he could take brilliant intuitions and convert them into succinct, rationally testable propositions.
"As managers gain facility with systems thinking as an alternative language, they find that many of their intuitions become explicable. Eventually, reintegrating reason and intuition may prove to be one of the primary contributions of systems thinking."
Senge, Peter (1990) The Leader's New Work: Building Learning Organizations. Sloan Management Review.