Systems thinkers — people who see the patterns and structures behind events — will be crucial to corporations as business continues to globalise, argues one business school professor. Kirin Kalia reports on his recent lecture.

Business people, so busy with their day-to-day activities, rarely take the time to immerse themselves in theories and ideas.

But stepping out of your "box" for a few hours or even a full day to soak in other ways of viewing the world can fuel enthusiasm for improving your company's practices — and can maybe even catalyse important changes in the way your company operates.

Professor Nigel Roome of Rotterdam's Erasmus University recently spent an engaging hour-and-a-half explaining "systems thinking" and why companies need to recognise and value their systems thinkers. His lecture was part of Netherlands-based De Baak Management Centre's English-language "Crossing Borders" programme, which featured academic and business speakers on international leadership and management topics.

Of the 30 or so executives who crowded into a room to listen to Roome, nearly all of them seemed to be newly inspired by the time they walked out the door.

What they learned, and what I will share here, should help you better manage your international and expatriate staff, as well as understand the people you work with every day.

Defining systems thinking

Have you ever worked with someone who answers a question with a question? Someone who frustrates colleagues because he or she takes too much time to reach a decision?

Most likely, that person was a systems thinker.

Roome's three characteristics of systems thinking (all of equal importance):

• Context dependency. Everything is different everywhere.
• Mutual dependency. A scientist says A causes B. But a systems thinker sees how A, B, C, and D are linked and how these relationships are a sub-system of another system.
• Events-patterns-structures pyramid. Behind events there are patterns, and behind patterns there are structures.

A systems thinker has a hard time understanding why other people can see only the events when they can see the structures, Roome pointed out. This difference, unfortunately, can further frustrate the systems thinker and the people who work with him or her.

Different ways of thinking

To put the systems thinker in context, Roome examined other decision-making styles.

First, he explained that there are people who are unifocused and people who are multifocused. A unifocused person can focus on one thing at a time while a multifocused person is juggling many tasks simultaneously.

A satisficer does not need much information to make a decision while a maximiser wants as much information as possible before deciding something.

Roome then used a matrix, comprised of these four types, to explain the different ways of thinking:

	Unifocal	multifocal
Satisficer	DECISIVE	FLEXIBLE
Maximiser	HIERARCHIC	INTEGRATIVE

Decisive and hierarchic types do not change their minds easily, while a flexible person can be easily persuaded (and also be seen as indecisive).

It quickly becomes clear that the systems thinker does not fit into this matrix. Why? Because systems thinkers are maximisers who can be both hierarchic and integrative.

"We are not naturally one decision style," Roome explained. Instead, our decision styles come through experience and the demands of our jobs. Whichever style is reinforced is the style we become accustomed to using.

Why systems thinkers are important in global business

Before the modern-day global corporation emerged, managing a company was like managing a river, explained Roome. You had input and moved it downstream toward an end goal, which was usually to make money.

Nowadays, managing a multinational company is more like managing a lake. A lake is part of a system that can have input from various sources, and an event on one side of the lake can affect the balance of everything in the lake. You are not only trying to make money, but you have to maintain your brand, retain your best people, make sure your foreign affiliates are producing, and please your shareholders. An action that supports one of these goals will likely affect your other aims.

Old business skills — being decisive and hierarchic — were valuable in managing rivers.

But to manage a lake, argued Roome, you need to be flexible, integrative and systemic.

A decisive person won't necessarily see how his decision about marketing affects production, margins, and eventually, profitability. A systems thinker will see those relationships play out before the decision is made, and may choose another course.

Paradoxes and systems thinkers

Modern business is filled with paradoxes. For instance, said Roome, as a brand becomes more valuable, it also becomes more vulnerable.

Another paradox: being global really means being multi-local. Local events are part of a global phenomenon. While the tendency may be to standardise products or services as a company expands its reach, in fact it should localise its offerings.

And while time moves at the same pace it always has, there is less time to make bigger decisions in this world of "just-in-time" delivery. That means the appropriateness of the choice becomes more difficult.

Therefore, Roome believes, systems thinking — which will make sense of factors affecting various paradoxes — is important for making strategic decisions.

Conclusions

While it may seem that, after all this discussion, systems thinkers are superior, Roome emphasised that companies need all types of decision styles.

"We need to know our own style and respect the fact that we can change [our style] depending on the context," he said.

That can only happen, though, when people are exposed to different types of decision styles. If you want more systems thinking in your company, then train people to think systemically and reinforce systemic thinking in certain situations.

And knowing your own style and being able to recognise other people's styles will also help you and your colleagues work more effectively in a team.

January 2003