Systems Thinking: Looking For Causal Loops

Yesterday I talked about how systems thinking can be used to find patterns and cause-effect-chains that help you find solutions to problems in projects.

All these patterns, links and loops are fine and dandy, but you are probably wondering right now how this is going to help you running your project?

Check Out This Example Of The Housing Crisis.

Image by I See Modern Britain.

First have a look at this great example about the housing crisis. Twitter user @jeremyx sent it in reply to yesterday’s post. Thanks!

I recommend to go to this example and click on “2. Trace Causal Loops”. It provides a nice, step by step explanation of the elements of the housing crisis …

“Tracing the CLD (causal loop diagram) will give you a high-level understanding of the relationships between the key components of the underlying model – housing supply, housing prices and demand for both housing and mortgages.

Stepping through the feedback loops really helps to explain the situation in very operational terms. And it’s much easier to understand what’s happening when you’re dealing with one loop at a time.”

And… you’re back!

The behavior of a system can be described using variables. A variable is an element of the systems you are looking at that changes over time, like “speed of service”, “number of clients”” or “number of customers that slap you in the face”. Or in the housing example “housing supply” and “housing prices”.

When analyzing your project using systems thinking, you have to look at a certain variable (like budget overrun, defect rate) over time, and then investigate the trend.

You are looking for patterns of behavior over time. As the systems are reocurring loops that effect certain aspects, patterns will emerge when you view them over time.

The pattern that you might discover is a hint to which archetypes one might look into (archetypes are the stereotypes of organizational problems and will be discussed in a later post). They don’t provide the final answer at once, you might try several archetypes before settling on your final verdict.

But first you have to decide on your variables.

You can start anywhere.

Just pick the issue that is bothering you the most, but don’t try to explain it, yet.

Remember, you are just looking for patterns over time. E.g. Programmer productivity is dropping. When you are doing this exercise with other people, it is always nice to use an element of the situation that can relatively be measured neutral.

For projects you can use:

• Schedule slippage
• Budget overrun
• Programmer productivity
• Size of backlog
• Number of change requests
• Number of bugs found
• Number of test cases performed per day

You get the idea.

Telling The Story

All these elements can rise or fall over a period of time. Try to describe how this element evolved over time and how the current status is. Always use words that indicate movement: goes down, goes up, increases, rises, falls, improves …

Then comes the next step: connecting elements. What is the impact of the movement of the first element on the next?

Because productivity is dropping, the risk of schedule slippage increases. You have to try to tell your story using sentences that indicate a causal relationship. “As this happens, then …”, “This in turn causes …”.

Go back and forth for a while. Make the story as detailed as possible. Avoid being judgemental. Only look for cause and effects. After a while, your loops will pop of the whiteboards!

This technique is described in detail in “The Fifth Discipline Fieldbook”.

Next up…

The Archetypes explained.

This a post in my series about using systems thinking for analyzing problems in projects.

1. Systems Thinking: A Technique To Find Project Problems
2. Systems Thinking: Looking For Causal Loops
3. Shifting The Burden And Fixes That Backfire – Archetypes Part 1
4. Limits To Growth And Tragedy Of The Commons – Archetypes Part 2
5. Systems View – Final Analysis