Systems Thinking Archetypes (Generic Structures) Reinforcing Reinforcing Loop
Loop
(population growth)
Archetype Behavior Examples Policy Advice S
net R state of S
increase
system1 R
Reinforcing (cid:159)growth or (cid:159)Population growth or (cid:159)recognize that reinforcing rate birth rate population
Loop decline of the decline feedback creates exponen- S S
“state of the (cid:159)Sales growth or tial growth that can bring on
system” decline pressures to retard growth
(cid:159)Microphone feedback (cid:159)they are two-edged swords
that can work for us or
against us
Balancing Loop
state of
system2
S goal
O
S
B gap
S
corrective
action2
Balancing (cid:159)goal seeking (cid:159)Heating or cooling sys- (cid:159)recognize that balancing
Loop (cid:159)regulates sys- tem; setting thermostat loops regulate the system
tem behavior to regulate room to provide stability and, on
(cid:159)opposes sys- temperature the other hand, resist Balancing Loop
tem change (cid:159)Economic growth; change (heating)
from set target Federal Reserve modi-
actual
or goal fying interest rates to
temperature thermostat
meet growth target
S setting
O
S
B temp gap
S
furnace
operation
Systems Thinking Archetypes © 2003 Continuous Improvement Associates page 1
Archetype Behavior Examples Policy Advice
Limits to (cid:159)Initial growth in (cid:159)Sales limited by serv- (cid:159)recognize that nothing grows
Growth the “state of the ice quality forever
system” is (cid:159)World population (cid:159)be aware of future limits and the
(at right are eventually lim- growth limited by pressures they will cause
two forms ited or falls off resources (cid:159)leverage for growth is often in
of this due to a looking for ways to reduce or
structure) resource con- remove the limits, rather than by
straint affecting pushing harder on the growth loop
or due to a
"side effect" of
the growing
action.
Limits to Growth
Limits to Growth
action limiting S
constraint constraint net state of
O S S O S increase R system3
limiting rate3 carrying
"side R growing R state of B limiting S capacity
action system action S
effect"
O S S O
S
fractional net B resource
increase S adequacy
Limits to Growth
Limits to Growth
(rabbit population)
(tennis ability)
elbow physical
use abilty
limit limit
O S S O S S
tennis R practicing R tennis B improvement rabbit birth R rabbit
elbow tennis ability potential rate population
resources
O S S S
S available
to rabbits
O
resource B S
resources
effect on
fertility S per rabbit
Systems Thinking Archetypes © 2003 Continuous Improvement Associates page 2
Archetype Behavior Examples Policy Advice Fixes That Fail
Fixes (cid:159)actions produce the (cid:159)taking drugs (whether narcotics or (cid:159)look for unintended
That Fail desired correction in pain-relievers) may make a person consequences of O
state of
the short-term, but feel better immediately, but does actions to relieve pain- system4
S goal4
have make the prob- not address root causes and makes ful symptoms R
lem worse in the one feel worse in the long run (cid:159)look for root causes O
S
long-term (cid:159)corporate downsizing reduces costs that are responsible unintended B gap4
(cid:159)typically a result of immediately, but impairs the organi- for the symptoms consequence
addressing problem zation’s ability to perform in the (cid:159)when addressing S
S
symptoms rather future symptoms, look for
corrective
than root causes (cid:159)road-building relieves traffic con- ways to reduce nega- action4
gestion in the near-term, but tive impacts
attracts more growth to again build (cid:159)take action to both
up congestion; the larger area also relieve immediate pain Fixes That Fail
makes existing public transportation and work on long-term (maintenance budget)
inadequate root causes
Addiction (cid:159)occurs when the (cid:159)addictive drugs wear off and a per- (cid:159)same as for S
expenditures
short term solution son needs more; they damage body “Fixes That Fail” budget
has to be taken again and mind R S
S
and again because (cid:159)expediting deliveries negatively O
equipment
the effect wears off impacts other products which must breakdowns B overspending
(cid:159)the need to take also be expedited and they interfere
O O
recurring action acts with normal working of the produc-
spending on
to drive the “Fixes tion & distribution system
maintenance
That Fail” dynamic (cid:159)city growth and development with-
(cid:159)exacerbates the out impact fees leads to infrastruc-
effects of the “Fixes ture backlogs and the need for Addiction
That Fail” dynamic more growth & development (growth)
approve
Addiction development &
promote growth
action based S
on short-term
O solution
S O
developments
S O B development B completed
decay of
effect of effect of S
B short-term B short-term S S
solution solution
S taxes from long-term
initial
infrastructure
development
needs
S R O O R S
sp te ar tec e oiv f e thd e S state of the perceived S actual
system infrastructure infrastructure
system
backlog backlog
Systems Thinking Archetypes © 2003 Continuous Improvement Associates page 3
Shifting the Burden
Archetype Behavior Examples Policy Advice
(to an external
intervention solution)
Shifting the (cid:159)actions taken to reduce (cid:159)taking drugs makes a person (cid:159)same as for
external
Burden symptoms reduce the feel better but reduces ability to “Fixes That Fail” intervention
ability to take action for improve life skills O
S
the long term. (cid:159)giving a man a fish vs. teach-
effect of
(cid:159)can be either shifting the ing a man to fish promotes
B external
burden to short-term, dependency intervention
rather than long-term, (cid:159)corporate downsizing reduces
O
solutions or shifting the costs immediately, but reduces
burden to an intervenor, the ability to develop new perceived S ability to
rather than to building products state of the R ip nu ters rnu ae l
system2 S
system capability (cid:159)HR deals with a manager’s solution
(cid:159)not only exacerbates the problem with low employee
effects of the “Fixes performance, rather than effect of
That Fail” dynamic, also assisting and training manager B internal
it reduces the ability to (cid:159)government insures bank solution
take action for the long deposits and bails out banks S
term and escape symp- rather than requiring sound O S
internal
tomatic solutions banking practices
solution
Shifting the Burden
Shifting the Burden Shifting the Burden (to the short term,
symptomatic solution)
(drugs to treat the (charity external intervention
short-term symptom) vs. teaching self-reliance) action based
on short-term,
take man accepts
symptomatic
drugs a fish
O O solution
S
S S S
drug man B effect of
B high B has short-term
food solution1 O
O O
ability to act
perceived S discu is pe line O motivation perceived S R based on
quality of life R to improve hunger R to provide state of the long-term
S life skills O for oneself system1 S solution
actual man has effect of
quality long-term B long-term
B B source of
of life food solution
S S S
O S S S O action based
improve life man learns on long-term, S
skills to fish fundamental
solution
Systems Thinking Archetypes © 2003 Continuous Improvement Associates page 4
Archetype Behavior Examples Policy Advice Eroding Goals
lowering
the goal
S
O
Eroding Goals (cid:159)there are two ways to (cid:159)it’s easier to lower qual- (cid:159)when performance is declining,
temptation
close the perform- ity targets than increase examine whether it could be performance B to lower
target
ance gap: quality because goals are being relaxed the goal
(cid:160) improve perform- (cid:159)it’s easier to let federal (cid:159)make goals clearly visible S S
ance budget deficits keep ris- (cid:159)examine the way goals are set and performance
(cid:160) lower the goal ing than to increase who sets them gap
(cid:159)also known as the taxes and/or decrease (cid:159)goals located outside the system are O
“boiled frog” spending less vulnerable to erosion S
syndrome (cid:159)it’s easier to relax envi- (cid:159)reward setting “stretch” goals & don’t actual B pressure
ronmental standards penalize if not met, which teaches performance to improve
than reduce pollution people to not set stretch goals. S
taking S
corrective
action to
improve
performance
Eroding Goals
Eroding Goals
(on-time delivery)
(quality of life)
lowering on-time
lowering quality
delivery goal of life goal
S S
O O
delo ivn e-t ri ym ge oal B lt doe ewm liep vr et a o rt ynio - gtn i om t ao e l qual git oy ao lf life B t le om wep rt a qt uio an li tt yo
of life goal
S S
S
S
on-time delivery quality of life
goal-actual
gap
O O
S
S
actu da el l io vn er-t yime B imp pr re os vs eu or ne - t to ime actual quality B top r ie ms ps ru or ve e
delivery of life0
life skills
S
S S
S
corrective action to
improve delivery self-improvement
perofrmance & learning
Systems Thinking Archetypes © 2003 Continuous Improvement Associates page 5
Archetype Behavior Examples Policy Advice
Path (cid:159)once one entity (cid:159)the “rich get richer ...” (cid:159)understand that
Dependence (person, prod- phenomenon this structure requires intervention to pro-
or uct, organiza- (cid:159)monopolies increase duce and maintain a “level playing field”
“Success tion, company, market share (but (cid:159)examine how the system has been
to the or country) gets reduce competition) set up for “winner-take-all” competition.
Successful” ahead, it’s eas- (cid:159)economic cluster (cid:159)find ways for teams to collaborate rather
ier to get even formation than compete
further ahead (cid:159)“good student” perform-
because better ance over “bad student”
Path Dependence or "Success to the Successful"
performance performance
provides more (cid:159)home vs. work A's B's
success success
resources and involvement S S
a greater ability (cid:159)manufacturing improve-
to improve ment favored over engi- S O
performance neering because it’s allocation of
A's accom- B's accom-
(cid:159)a “figure 8” is a faster and easier R1 resources to A, R2
plishments plishments
reinforcing loop rather than to B
S S
O
S
resources resources
to A to B
Path Dependence Example: the "experience curve." Path Dependence Example: self-fullfilling prophecy for student success
competitor our price
price S perceived benefit perceived benefit
S from investing in from investing in
student A student B
S
S
S O
R1 R2
our market share
c uo nm
it
p ce ot sit to sr
Competitor
vs. competitor
Our Market
o cu or su tn sit R1 S O R2
market share success of time spent with success of
O Market Share Share O student A Student A student A vs. Student B student B
S Success student B Success S
S
competitor O
our cumulative
cumulative S O
production
production investment in investment in
student A student B
Systems Thinking Archetypes © 2003 Continuous Improvement Associates page 6
Archetype Behavior Examples Policy Advice Escalation
Escalation (cid:159)individual action (cid:159)arms race increases (cid:159)understand that over- A's B's
that attempts to weaponry (but coming this structure results results
S S
increase security or decreases security for requires cooperation
performance at the all) toward a larger goal that
S O
expense of another (cid:159)price wars increase benefits competing
A acts to B acts to
(e.g., a competitor) sales and market parties counter B1 results of A B2 counter
relative to B
results in less share (but decrease (cid:159)examine how the struc- threat threat
security or profits for all) ture reduces results in S S
decreased per- (cid:159)regions compete on the long run (e.g., in an
O
formance over the the basis of low taxes arms race there is less threat S threat
long run. & less regulation for a security) to A to B
(cid:159)this structure is limited number of jobs (cid:159)examine whether percep-
brought on by (but leads to infra- tions of opponent’s intent
unbridled competi- structure backlogs for is accurate (perhaps
tion and can only all regions) they see themselves
be escaped by pro- (cid:159)cities compete for as simply responding
moting cooperation sports teams based to your action)
based on mutual on expenditures to (cid:159)examine whether percep-
interests support the teams (but tions of opponents ability
(cid:159)a “figure 8” is a leads to “build us a is accurate (e.g., perhaps
reinforcing loop stadium or we go else- their arms potential is not
where” blackmail and as great as perceived)
higher costs for all
cities)
Escalation Example: the "arms race" Escalation Example: price war
other nations
U.S. weapons
weapons A's sales B's sales
stockpile
stockpiles
S S S S
B1 S O B2 B1 S O B2
U.S weapons other nations'
U.S. weapons U.S. superiority over Other weapons company Company A market share Company B company
produc Stion W Be ua ilp do un ps other nations WN ea ati po on ns s' pr Soduction A c p ur ti sce C Bom asp ee dt i oti non vo sf . c co om mp pa an ny y A B C Bom asp ee dt i oti non B c p ur ti sce
Buildup S Price Price S
O S
S
U.S. O other nations' company A's company B's
perception perception of perception of perception of
of threat threat competitive threat competitive threat
Systems Thinking Archetypes © 2003 Continuous Improvement Associates page 7
Archetype Behavior Examples Policy Advice
Tragedy (cid:159)rational action (cid:159)overgrazing on land destroys the land’s ability to grow feed (cid:159)understand that overcoming this structure requires
of the by individuals (cid:159)overfishing depletes the fish stock and the ability of fish to cooperation toward a larger goal that manages com-
Commons to improve reproduce ... in this case the “market” signal is increased mon resources and benefits competing parties
individual per- price, which leads to even more fishing and more rapid (cid:159)apportion the expense of long-term collective loss to
formance destruction of the commons individuals or limit individual activity (grazing fees, fish-
results in (cid:159)increasing individual farm production by increasing land in ing limits, land allowed in production, development
destroying the production and improving technology has the goal of impact fees)
ability of the increasing farm income ... but the increased supply in the
whole system presence of inelastic demand decreases prices so all farm-
to perform ers go broke without government subsidies or small farm-
and also ers get bought out by larger farmers (which does not
destroys the decrease the supply of land) Tragedy of the Commons
ability of indi- (cid:159)groups benefit more from getting more resources from a
(the market for farm commodities)
viduals to per- common organizational resource pool, but overload the
form as the common resource (e.g., quality, HR, reproduction services) Farm A Net
system is (cid:159)individual engineering teams maximize the electrical func- S Income S
Farm A
destroyed. tions they’re designing by drawing more on the electrical
Commodity
power system, but overall exceed the electrical system’s Profit per
ability to supply power R1A R2A Unit
Farm A
(cid:159)firms benefit from economic activity that causes pollution, Production Farm A Farm A O S
but increase negative health impacts for all Quantity
Production Efficiency
(cid:159)developers profit from more development that uses S Farm A
common infrastructure, but overwhelm infrastructure Cost per
S Unit
O
Farm A Land in
Tragedy of the Commons
Production &
Tragedy of the Commons (fishing) Efficiency Farm A: Total
Produce More, Demand
Lower Price
B3A
S S
S sustainable Farm
acA ti' vs ity R1 ne ft o g r a Ains reso ou rrce A's fishinS g R1 A's profits fo isc he ia nn g ProT do ut ca tl ion O C Po rm i Ucm ne i o p td ei rty
S S de lm ima itnd S O capacity S B3B Farm B:
Produce More,
B3 S B3 Farm B Land in Lower Price
S total ing da ii vn i dp ue ar l S ree qf ufo irr et d O Pr Eo fd fiu cc ieti no cn y & O Farm B
S
activity O activity
S
total fishing S p ce ar
u
f gis hh
t S
Co Us nt ip ter
B4 S R1B R2B
B4
Farm B
O S
Production Farm B Farm B
S
S O Quantity Production Efficiency Farm B
B's net gains S
Commodity
activity for B B's fishing B's profits
R2 Profit per
S S R2
Unit
S Farm B Net S
Income
Systems Thinking Archetypes © 2003 Continuous Improvement Associates page 8
Archetype Behavior Examples Policy Advice
The (cid:159)a growing action (cid:159)no company can be all things (cid:159)practice “strategic unattractive-
Attractiveness encounters multiple to all people (lowest price, ness” ... that is, decide on the
Principle “Limits to Growth” best product, best service); it features that will make the prod-
(cid:159)addressing one limit must decide and focus on its uct or region less attractive and
(this diagram is puts more pressure “value proposition” balance out the attractiveness of
shown with the on other limits (cid:159)no region can be all things to the other features that are more
typical price, (cid:159)As Forrester said, all people (lowest taxes, low- desirable to customers or the
service quality, “There are no uto- est housing prices, best qual- other features that are neces-
product quality pias in social ity of life, best jobs) sary to support the organiza-
features, but systems.” tion’s purpose/mission.
there are oth-
ers, (e.g.,
delivery delay,
o o
community
participation /
citizenship) invest in
service
S capacity S
service
capacity Service O
Focus
service
B7 S B5
service quality
Service demand O service standard
Quality B2 quality
demand S
Burden
generating
S
activity Service Quality
Erosion S
S
Net Revenue (funds R1 S customer S Overall
costs O availab dl ee m to an g de )nerate demand P Aro ttd rau cc tt i/ vS ee nr ev sic se O
Demand
S S
Generation Product Quality S
Erosion
product
Product price S S development
Quality B3 product quality
Burden product quality standard
demand O B6
B8
S
Product
product Focus O
S
B4 development
invest in product
capability
Scarcity S development
capability
Premium
o o
Systems Thinking Archetypes © 2003 Continuous Improvement Associates page 9
Tragedy of the Commons Tragedy of the Commons
(the market for farm commodities) structure and the
S Farm Policy Death Spiral
Farm A Net
S Income S
Farm A
Commodity
B4A
Profit per
R1A R2A Unit Farm A
PrF oa dr um
c
tA
ion Farm A Farm A O S
PrIn oc teo cm tie
on
Quantity
Production Efficiency Low Interest
S Farm A O Farm A Loans Loans
Cost per
S Unit B5A O
O
Farm A Land in
Production & B7A
Efficiency Farm A: Total Chart: Trends in Government Farm Supports
S Produce More, Demand S
Lower Price Farm A Tax Daryll E. Ray, agricultural economist with the Agricultural Policy Analy-
S B3A S Breaks sis Center at the University of Tennessee, testified before the House
Breaks> Support> Production O Pri Uc ne i p ter S SuP pr pic oe rts O InF ca orm me Breaks T bee lr om w ;P ir ti ac le ic sa n ad n dIn uc no dm ee r liP nr go sb ale rm e s a, s" i( ns e he is e ox rc ige ir np ats l) .from his testimony S B3B Farm B: Farm B Tax http://agriculture.house.gov/hearings/h10214w2.htm S P Lro od wu ec re P M rio cr ee, In< tL eo rew st S Breaks ... our response to the subsequent downward spiral of crop agriculture Farm B Land in Loans> B7B suggests that we are in denial. We are in denial that anything long-term Pr Eo fd fiu cc ieti no cn y & O Farm B O B5B is to blame for the devastatingly low prices and low market incomes in Cost per crop agriculture. We are more than willing to blame agriculture’s prob- S Unit Farm B Loans lems on the Asian Crisis, exchange rates, energy prices, or anything S R1B R2B else that comes along. Others blame the level of loan rates, emergency O Farm B O S payments, crop insurance, etc., etc. Production Farm B Farm B Farm B Technology The implication being that: once the—you-name-it-disruption—subsides Quantity Production Efficiency Farm B Income Support Commodity Protection or is remedied, agriculture will be just fine. That is nonsense. There are Profit per B6A Farm A Tech always disruptions. There are disruptions in agriculture, the auto indus- Unit B4B try … every industry. At this stage of the farm policy debate, discussion S Farm B Net S should not center on this or that disruption, but on the ability of agricul- Income B6B Farm B Tech tural markets to make adjustments irrespective of the exact nature of S the disruption. Other industries self-adjust. growth of crop supply compared to crop significantly more total food, no matter how far possible because of taxpayer support, assures Why doesn’t crop agriculture? That is the real demand and b) the price responsiveness of the collective price of food has dropped. Is this relatively rapid shifts in supply. Under this question. supply and demand. true for other products? Of course not. combination of price unresponsive supply, price This time in history and this stage of the farm Total crop acreage (supply) is unresponsive to Typically, a price drop greatly expands the unresponsive demand and supply shifting bill debate cycle provide the perfect opportunity price declines in short or longer-run. quantity demanded of an industry product. ... faster than demand, prices and income can be to make a definitive determination of the how Farmers have no incentive to reduce productionAgriculture is unique. Much of that uniqueness expected to be chronically depressed. This is the grain markets work. For the first time in as prices decline. From an individual farmer’s is rooted in two characteristics: (1) cropland will not a short-run problem. nearly seventy years, markets have been free standpoint, there is no rational reason for be used to grow crops and (2) food is essential Left to itself, crop agriculture would continue its to reveal the true supply and demand behavior him/her to leave land idle because crop prices for life but the quantity needed is finite. These downward spiral, bankrupting successive farm- of U.S. crop markets. have declined ... . Each farmer produces too lit- and other supply and demand characteristics ers on a given piece of land, forcing bank fore- I believe that the market experience of the last tle to affect total supply and therefore price, so virtually assure that there will be little change in closures, and, in general, wreaking devastation four years shows that crop agriculture is just as any reduction in his output means less total crop acreage and little change in the quan- on ALL rural areas. It would be a disaster of a prone today to chronic price and market incomerevenue. … tity demanded as prices fall, even by 40 per- magnitude that would be well beyond political problems as it was when farm programs were Demand is unresponsive to price changes. cent over a four year period. acceptability. Those that believe otherwise also instituted decades ago. My mission in this testi- Periodically, crop exports will grow for several believe that supply and demand quickly adjust mony is to explain why I believe that is so. Because it is essential for life—like insulin for a years at relatively high rates, but usually they to lower prices. If that were true, then crop A qug ir cic ku lyl t uu nre d’ es rp sr toic oe d a bn yd cin oc no sm idee r t inro gu ab )le ts h ea r re ate of d c oo bia m tb aee inst i c itf— .ir Bsp t u.r ti W c oe e n i cs w e o i l wlf p eli at t hyle a w vc eho an ets nee ovq e uu r g e hisn , c r wee iq. ll uF nio r oeo t dd b uto y d cuo l tn uo ret. , mTe oc sh t n oo f l wog hi ic ca hl ia sd dv ia ren cc te lys oin r ic nr do ip re a cg tlr yi- a ag gr ri ic cu ul lt tu ur re e w doo eu sld n 's t.e l If t- c reo arr le lyc t is. tB hu at t i st ii ms pn lo et . and Systems Thinking Archetypes © 2003 Continuous Improvement Associates page 10
