What is Systems Thinking
on Leadership?

What is systems thinking on leadership? – is a common question.

Systems thinking on leadership is when you visualize a system (your organization) as a collection of interrelated parts (Divisions, Departments, etc.) bound together to achieve a purpose (products and services), where the relationships between such parts are as important as the parts themselves, and where the whole (your organization) interrelates with its external environment (your customers, your suppliers, the market, the economy, the government regulations, etc.) as well.

Simple, isn’t it?

For example, any living creature is a living system – the human body, a flea, an elephant, etc.

What is systems thinking on leadership? Organizations have shared attributes with all living systems, and as stated above, the focus is on the relationships of all the pieces as they interact together, as opposed to only focusing on just the individual pieces themselves.

Russ Ackoff – an authority in systems thinking – gave the following elegant and beautiful illustration (1971 unpublished speech, The Second Industrial Revolution), cited by Dannemiller Tyson Associates, “Whole-Scale Change: Unleashing the Magic in Organizations” (Berret Koehler, San Francisco, CA: 2000):

“Let me try to give you a feeling of why that [systems thinking] is so, by giving you an example rather than trying to give you a generalized proof. I would like you to go through the following thought experiment. I read in the New York Times the other day that there are 142 makes of automobiles available in the United States. So let’s get one of each and bring them into a large garage – 142 cars.

“We’ll hire ourselves a good group of first rate automotive engineers and fist ask them to do the following: Inspect those 142 cars, test them, do any damn thing you want to, but come out and tell us which one has the best carburetor. So they run a series of tests and they come out and say the Buick has the best carburetor. So we make a not – Buick carburetor.

“Then you say fine, now we would like you to do the same thing on transmissions. So they test the transmissions and they come out and say the Mercedes has the best transmission – we make a note – Mercedes transmission. What is systems thinking?

“You say okay, take the distributor, and they run through and they come out and say the Dodge has got the best distributor.

“Then one by one, we take every part until we have every part required for an automobile and we have identified the best parts available. Now when that is done, we tell them to take those parts off those cars and assemble them, because then we ought to get the best possible automobile.

“But, do you get it? You don’t even get an automobile. And for a very obvious reason.

“Because it turns out that the parts don’t fit, and that’s what systems thinking is all about.

“It says that the performance of the whole is not the addition of the performance of the parts, but it is a consequence of the relationship between the performance of the parts. It is how performance relates, not how it occurs independently of the other parts. That is what systems thinking is about.What is systems thinking?

“So, synthesis is a different way of thinking and looking for explanations. It tries to find it by looking at wholes, the larger whole, of which things are a part rather than by taking things apart.”

What is systems thinking in organizations? From the systems thinking perspective, we can see that several authors have built different organizational models, for example:

Dannemiller Tyson Associates (ibid.) built the “Star of Success” – composed by strategic direction, processes and systems, relationships, resources, and information – to design and facilitate large-scale organizational change.

David A. Nadler and Michael L. Tushman, “Competing by Design: The Power of Organizational Architecture” (Oxford University Press, New York, NY: 1997) built the “Congruence Model” – composed by input, strategy, work, informal organization, people, formal organization, and output – to diagnose organizational behavior.

Alan P. Brache, “How Organizations Work: Taking a Holistic Approach to Enterprise Health” (John Wiley & Sons, New York, NY: 2002) built the “Enterprise Model” – composed by external factors (suppliers, the economy, customers, etc.) and internal factors (leadership, strategy, culture, etc.) – to change organizational DNA.

What is systems thinking on leadership? In order to help leaders to recognize a realistic number of priorities that will have the greatest possible effect on the success of their organizations – in order to help them focus on the organizational levers with the most impact on organizational performance, we designed a simple yet powerful three-parts model based on Patrick Lencioni, “The Four Obsessions of an Extraordinary Executive” (Jossey-Bass, San Francisco, CA: 2000):

+ The HEAD of the organization
+ The HEART of the organization
+ The MUSCLE of the organization

See our Leadership Skills page (how we define leadership) for details, or just go back to the previous page.

When a leader concentrates her efforts on these three parts of her organization, and her management and leadership practice is flawless within every single part, the performance of her organization will literally soar.

In the exact sciences (mathematics, chemistry, biology, etc.) you can guarantee that two plus two equals four – but there is no such thing in the realm of the inexact sciences (organizational behavior, management, leadership, etc.) What is systems thinking?

However, the long-term success of any organization is a direct consequence of the way it is managed and led – it is a direct consequence of the quality of the management and leadership practice its leaders perform on a daily basis.

In management and leadership there are no silver bullets, no magic recipes, and no new and latest management fads that will cure all your organizational illnesses.

What is systems thinking on leadership? On this entire website there is nothing new – I warn you.

But after working with hundreds of executives over the years, I have come to learn one thing: Managers and leaders don’t necessarily learn exactly what they need – rather, they have the tendency to learn what is accessible and easy for them to learn.

Hence, I have designed this website with that in mind: It’s easier to remember just three things (the head, the heart, and the muscle) than to remember a zillion number of different issues – the same holds true for our Performance Management section with practical skills to manage the performance of your direct reports.

What is systems thinking on leadership? As a leader, focus on the three key areas of your organization: Its head, its heart, and its muscle with equal attention – if you excel in two but neglect one for whatever reason, you won’t be able to build a high performance organization. Your organization is a system, and as such, the relationships among all three are decisive.

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To keep on learning about leadership skills, go back to the previous page (or click here ), and continue reading in a sequential order.

If you would like your executives to find out about what is systems thinking on leadership through our speaking or consulting services, please click on this link.