Systems thinking is a holistic approach to analysis that focuses on the way that a system's constituent parts interrelate and how systems work over time and within the context of larger systems. The systems thinking approach contrasts with traditional analysis, which studies systems by breaking them down into their separate elements. Systems thinking can be used in any area of research and has been applied to the study of medical, environmental, political, economic, human resources, and educational systems, among many others.
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According to systems thinking, system behavior results from the effects of reinforcing and balancing processes. A reinforcing process leads to the increase of some system component. If reinforcement is unchecked by a balancing process, it eventually leads to collapse. A balancing process is one that tends to maintain equilibrium in a particular system.
Attention to feedback is an essential component of system thinking. For example, in project management, prevailing wisdom may prescribe the addition of workers to a project that is lagging. However, in practice, that tactic might have actually slowed development in the past. Attention to that relevant feedback can allow management to look for other solutions rather than wasting resources on an approach that has been demonstrated to be counterproductive.
Systems thinking uses computer simulation and a variety of diagrams and graphs to model, illustrate, and predict system behavior. Among the systems thinking tools are: the behavior over time (BOT) graph, which indicates the actions of one or more variables over a period of time; the causal loop diagram (CLD), which illustrates the relationships between system elements; the management flight simulator, which uses an interactive program to simulate the effects of management decisions; and the simulation model, which simulates the interaction of system elements over time.
Systems thinking originated in 1956, when Professor Jay Forrester founded the Systems Dynamic Group at MIT's Sloan School of Management.