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Systems Thinking: What is Systems Analysis

Systems are everywhere – your car, your life, and the world around you. When you examine the systems that govern your life, world, and business, you can control systems to work for you. We can use systems thinking as a framework to critically think about and solve problems that arise in our life and business.

What is a System?

First, let’s define a system before we dive into more in-depth on the topic:

A System is defined as:

  1. A set of things working together as parts of a mechanism or an interconnecting network.
  2. A set of principles or procedures according to which something is done; an organized framework or method.

From the first definition, we can see that a system describes the parts making up a machine used to do work with the same consistency. We can observe refrigerators as systems thinkers to cool our food down to an exact temperature every time.

From the second definition, we can see that a system describes the processes that people or organizations utilize to achieve a particular mission. We can observe the local government as a system works of people working to decide how to spend taxpayer money.

Thus, systems are organized structures of things or people to achieve a specific goal. We can examine a system either externally or internally using the concept of systems thinking.

What is Systems Thinking?

Systems thinking is a method of analyzing the system to understand the system and solve problems that result. We will examine the system as a whole, its constituent elements, internal processes, and the relationships within. When we step back, we can see that we are all a part of various systems that exist in the world.

Systems Thinking from an Externally Viewpoint

First, we can look at the system externally as a black box. In engineering, science, and computing, the term “black box” is used to describe a system that can be viewed in terms of its inputs and outputs without any knowledge of its internal workings.

External System Characteristics

This external system can be broken down into the following main characteristics (shown in the image below):

  • Input – what is put in, taken in, or operated on by any process or system.
  • Process – a series of actions or steps taken in order to achieve a particular end.
  • Output – the amount of something produced by a person, machine, or industry.
  • Feedback – information about reactions to a product, a person’s performance of a task, etc. which is used as a basis for improvement.

We can look at most objects in your home or work as systems from the outside. These devices are systems thinkers that require an input of power to produce an output of work.

Example: Air Conditioning (AC) Units

For example, AC units are commonly used to cool down rooms in a lot of buildings. Let’s say that we just moved into an apartment building. This building requires us to buy and install AC units in our windows to cool down our rooms.

Examining an AC unit using systems thinking
Source: Dan LeFebvre

External System Breakdown

  • Inputs:
    • Power: The AC unit requires an input of power to operate, so we plug the system into a wall outlet. 
    • Desired Temperature Setting: Then, we have to set the input of the temperature to 20°C, as this is our desired room temperature. 
    • Current Room Temperature: The unit reads the current room temperature of 25°C as an input. 
    • Air: Lastly, the unit takes in the air, as an input to change the temperature in the room.
  • Process: The AC unit is the black box system that takes in air from the house and cools the air down. We view the AC unit as a black box as we don’t know how the AC unit works to cool the air down. We simply plug in the system and expect it to cool our room down.
  • Output: The result after the AC switches on with cold air flowing out to lower the room temperature from 25°C to get to 20°C eventually.
  • Feedback: The AC unit is continuously reading the air temperature in the room. When the temperature of the house reaches 20°C, the AC is turned off, and no more air is taken into the system.

Applying Systems Thinking

Let’s analyze a problem to use the systems thinking approach from an external perspective. Suppose, we wake up sweating to a hot room. We realize that our AC stopped working in the middle of the night and is not on. 

We can analyze the characteristics of the system works to solve the problem:

  • Outputs: First, we realize that the AC unit is not outputting cold air to lower the temperature of the room to what we want. We recognize that there is a problem with our machine as it is not working correctly.
  • Inputs: We take a look at our inputs and realize that the power cable was knocked out of the wall outlet by our dog. We simply plug the power cable in to supply the missing input to the AC unit, and it works. This situation is pretty common as most machine-related issues are due to a loss of power or resetting of the power.
  • Process: We have checked that all the inputs to the AC unit and they seem to be okay. Thus, we realize that there is an issue with the AC unit’s processing of the air. The air is taken in and comes out at the same temperature. As we are viewing this unit as a black box, we don’t have any knowledge of its internal workings. Thus, we can employ an expert or handyman to fix our AC unit.
  • Feedback: Suppose that our AC unit seemed to be working fine, but then it kept cooling the room beyond the desired temperature. We realize that the system is not using the feedback of the room temperature to know when to shut off automatically. This situation is also an issue with the process, and we can again call a handyman to fix our AC unit.

Systems Thinking from an Internal Viewpoint

Second, we can look at the system internally.

Internal System Characteristics

The system can be broken down into the following main characteristics (shown in the image below):

  • Environment – the surroundings or conditions in which the system lives or operates.
  • Boundary – the line that marks the limit of the system from the environment; this boundary can be open or closed to the environment.
  • Subsystem – a self-contained system within the larger system.
  • Component – a part or element of a subsystem or the larger system
  • Interconnection – the way in which each of two or more components or subsystems is related to the others.

It is common to examine devices or organizations of people as systems from the inside. We are now demystifying the “black box” to understand the inner workings of the system as a whole, its subsystems, its components, and interconnections that exist.

Example: Hotel Management

For example, we can internally look at a hotel as a system from a management perspective. In management, we are directly involved in the process of dealing with or commanding people in the hotel. The goal of management is to provide its customers with a quality place to stay in order to generate revenue for the hotel.

Beautiful hotel with a pool
Source: Valeriia Bugaiova

Internal System Breakdown

  • Environment: For the systems analysis, we can examine the hotel as operating within the context of a city or town’s local economy.
  • Boundary: The hotel is separated from its environment by the land boundaries that the hotel sits within. This identifies the hotel as a separate property from the neighboring buildings and land. The boundary is open to the environment, as people, goods, and power pass through the hotel grounds every day.
  • Subsystems: Many subsystems exist within the hotel. The organization of the staff can be further broken down into subsystems of departments, including the front desk, operations, housekeeping, and maintenance. The hotel room itself can also be a subsystem containing the components within it. 
  • Components: Following the example in the subsystem bullet, the elements that make up the hotel room subsystem include the bed, bathroom, AC unit, desk, and many more.
  • Interconnections: Many interconnections exist within a hotel. Common examples include the interactions of the employees and customers, relationships amongst the staff, and the exchanging of money for rooms and amenities.

Applying Systems Thinking

The use of systems thinking can help the owner or manager solve problems that occur within the hotel. Many issues can occur, including angry customers, mismanaged room cleanings, and overbooking. 

The manager can take a system’s level approach for deep understanding and solve problems:

  • Environment: The manager can analyze the impact of the environment on the hotel, such as changes in tax rates or construction of a competitor hotel next door.
  • Boundary: The manager can analyze the change in customers that stay at the hotel concerning days of the week, holidays, or events.
  • Subsystems: The manager can handle the different department subsystems to get the work done. Suppose a customer is having issues with operating the AC unit in their room. The manager can have the maintenance staff check-in on the AC unit.
  • Components: The housekeeper uses a list of the hotel room components to fully clean such that it is ready for the customer. If there is an issue, the manager can go in and inspect the room components to figure out if additional cleaning is required.
  • Interconnections: The manager can examine and resolve issues between different components and subsystems. If there was an angry exchange between the front desk staff and a hotel guest, the manager could figure out what may have caused the argument.

Next Steps

In later blog posts, the Process Hacker will help you apply systems thinking to be more productive. For right now, start thinking about the various systems that make up your life and business processes. Analyze your systems externally to figure out your desired output and inputs required. Also, analyze your systems internally to better understand the inner workings, constitute subsystems and components, and interconnections that exist.

If you have any further questions or need additional help, feel free to comment below or send me an email. Also, if you want more Process Hacker content, you should subscribe to our weekly newsletter on Productivity, Habits, and Resources.

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