Common System Traps
+ +System traps—like addiction, overproduction, or the tragedy of the commons—are well understood but difficult to avoid. The bounded rationality, non-linearities, delays, and other factors discussed in evaluating systems in the previous post contribute to making outcomes in these archetypes often seem inevitable.
+ +Here are some of the most common system traps:
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- Policy Disagreements - Bounded rationality often leads to policies that may solve short-term issues but create larger problems later. A classic example is Romania’s policy to ban abortions in an effort to increase population. While it worked initially, it led to long-term socio-economic challenges: increased illegal abortions, higher mortality among pregnant women, and a surge in abandoned children. These cascading effects eventually contributed to a revolution that overturned the government. +
- Tragedy of the Commons - This occurs when individuals, acting in their own self-interest, deplete a shared resource. It’s a reinforcing feedback loop where short-term gains for individuals lead to long-term losses for everyone. Overfishing, deforestation, and pollution are all examples of this. Left unchecked, the system collapses because the resource is exhausted. +
- Drift to Low Performance - When we measure performance against poor past outcomes, it creates a negative feedback loop. Over time, expectations lower, and people forget that better performance was once possible. To avoid this, you must set objective performance benchmarks or compare against better historical outcomes, not just the most recent ones. +
- Escalation - Escalation results from reinforcing loops that push competing entities to outdo each other. In some cases, like industrial competition, this is beneficial. However, in others—such as arms races—it can be devastating. A softer example is in marketing: brands escalate the intensity of their messaging to stand out, but eventually, consumers become numb to all messaging. +
- Success to the Successful - When those who succeed gain more resources to continue succeeding, it leads to a reinforcing loop. Monopoly in markets is a classic example: successful companies grow stronger, while smaller competitors struggle to survive. However, this dynamic eventually creates opportunities for new challengers to disrupt the system. +
- Addiction - Addiction in systems doesn’t only apply to drugs—it can occur with subsidies, fuel, fertilizers, and other resources. When a system becomes overly dependent on an external input, it loses resilience. Over time, the system’s actors become less capable of functioning without the crutch. +
- Rule Beating - This happens when people follow the letter of a rule but not its spirit. For instance, departments often spend leftover budget wastefully to avoid receiving a reduced budget next year. Rule beating can erode trust, destroy systems, and lead to unintended consequences. +
- Poorly Defined Goals - When system goals aren’t clearly defined, the system operates on poorly aligned incentives. For instance, if national security is measured by the percentage of GDP spent, the system will focus on spending, rather than actually improving security. Clear, thoughtful goals are crucial to avoid misaligned behavior. +
Creating Systemic Changes
+ +Systemic changes happen when you find and act on the right leverage points. Below are some of the most common leverage points that can influence the behavior of a system.
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- Growth - Systems thinker Jay Forrester once said that “growth” is one of the key drivers of change in any system. Growth brings both benefits and costs. Understanding both aspects is essential to leverage growth effectively. +
- Buffers - Systems with large buffers are more stable. A large stock relative to its flows provides resilience. For instance, you hear about river floods but rarely about lake floods because lakes have large buffers. Buffers are hard to change but critical in ensuring system stability, such as maintaining a minimum population for endangered species. +
- Physical Structure of Stocks and Flows - The structure of a system’s stocks and flows determines its behavior. Poorly designed systems require rebuilding to improve. The layout of physical structures in production, supply chains, or ecosystems becomes difficult to change after the fact, so thoughtful design is crucial from the start +
- Delays - The timing of information and actions can make or break a system. Delays between action and feedback create inefficiencies. For example, the central planning in Soviet Russia struggled with delays, making the system inefficient. Addressing delays can significantly improve responsiveness and performance. +
- Balancing Feedback Loops - Balancing loops keep systems stable. In nature, the thermostat or our ability to sweat when hot is an example. In societal systems, democratic elections act as a balancing loop, where governments are kept in check by the electorate. The presence of these loops allows for self-correction. These loops drive growth or decline. A flu epidemic spreads because one person infects others, who in turn infect more people. Reinforcing loops can cause exponential growth or collapse, depending on whether the loop is feeding a positive or negative outcome. +
- Information Flows - Access to information affects system behavior. In a study of Dutch households, those with electric meters placed visibly in their homes consumed less electricity than those whose meters were hidden in basements. Simple changes in the flow of information can alter system outcomes. +
- Self-Organization - Self-organizing systems are resilient because they adapt without central control. In ecosystems, for example, species co-evolve and balance each other out. Encouraging self-organization in human systems promotes flexibility and innovation. +
- Goals - The system’s purpose, or goal, is one of the most critical leverage points. Every part of the system works in service of that goal. Clear, well-defined goals ensure that the system functions effectively. +
- Paradigms - A system’s rules, goals, and behavior are based on its paradigm—the overarching mindset. For example, ancient Egyptians built pyramids because they believed in the afterlife. Today, we build skyscrapers because we believe in maximizing urban space. Paradigms shape what systems do and why. +
- Transcending Paradigms - The most powerful leverage point is the ability to transcend paradigms. Recognizing that no single worldview is absolute allows us to stay flexible and adopt the most helpful paradigm for a given situation. This agility can lead to greater creativity and systemic change. +
In summary, systems thinking helps us see the broader dynamics at play and how to influence change effectively. By understanding common system traps and the key leverage points, we can design better systems and anticipate unintended consequences.
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I run a startup called Harmonize. We are hiring and if you’re looking for an exciting startup journey, please write to jobs@harmonizehq.com. Apart from this blog, I tweet about startup life and practical wisdom in books.
]]>What is Systems Thinking?
@@ -468,36 +508,4 @@ Neil Gaiman’s writing shedOne of the key tenets of smart failures is it happens when the team posseses a growth mindset. A growth mindset, defined by Carol Dweck, is the belief that one’s abilities can be developed through dedication and hard work. A fixed mindset, on the other hand, is the belief that one’s abilities are innate and cannot be changed. A growth mindset is characterised by the curiosity to learn what went wrong and a willingness to go through the pain of looking back in the failure to learn. A fixed mindset is characterised by the fear of looking back and the pain of admitting that one was wrong.
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I run a startup called Harmonize. We are hiring and if you’re looking for an exciting startup journey, please write to jobs@harmonizehq.com. Apart from this blog, I tweet about startup life and practical wisdom in books.
]]>Useful arts
- -We often associate plumbing, fitting electrical appliances or motorcycle maintenance with something mundane, when in reality these are one of the most useful arts. These are the arts that make the world go round. People practising these useful arts in reality are often leading much more meaningful lives than we would care to accept. Manual work like plumbing needs a lot of systematic encounter with the material world and is cognitively enriching. The fact that old items rust and deteriorate means a repairman needs to apply practical experience along with theoretical guidelines to fix an item (which for ex may break due to rust or simply usage based wear and tear). They don’t simply read a manual and execute a set of instructions as the manual cannot and does not cover every possible scenario. In a way they are the true persuers of knowledge as without learning through hands, the world remains distant and true learning remains at bay.
- -Manual craftsmen like mechanics or plumbers, often have a more tightly knit social life. They share tools, knowledge, often times even customers. They are also more likely to be self employed and thus have a more direct relationship with their customers. They are also more likely to be in a position to say no to a customer if they don’t like the customer. This is in stark contrast to the modern day office worker who is often a cog in a wheel and has little control over their work.
- -Thinking vs doing
- -The degradation of manual work began with scientific management which began with Frederik Winslow Taylor’s management theories (whose fans included Stalin and many B school professors). The cognitive parts of manufacturing were slowly moved away from the shop floor to a management office. The primary intention was not efficiency but cost. Once a mechanical activity becomes a piece of a process with little or no cognitive requirement, a skilled worker can be replaced by an unskilled one. Thus, craft knowledge dies out. This is also called the abstraction of labor. This draining off of cognitive requirements from a job isn’t limited to blue collar work, desk jobs, traditionally thought of to be knowledge work, are also going through an abstraction, which the author calls, a rising boats of clerkdom.
- -In essence, the dichotomy is not between manual work and knowledge work, it is between work that is meaningful and work that isn’t. We have grown to like sitting on a desk and doing work that does not require physical labour but design plans that someone else, often lower down in the hierarchy, will execute. This is a sort of a moral hazard. We have grown to like the idea of being a manager rather than a worker. This is also called the Peter Principle and is best summarised by the quote “In a hierarchy, every employee tends to rise to his level of incompetence”. The world has shifted from production of goods (which has moved elsewhere) to the marketing of brands.
- -College graduates often look for specific jobs that pay less than blue collar manual jobs, for the sake of looking for “knowledge work”. This can often mean that the college educated are psychically incapable of taking manual jobs and instead prefer taking up paper pushing cubicle jobs that don’t have a clear objective threshold for quality (other than grammar). That we submit our youth to such jobs that are more prone to the overall production of low quality, is unacceptable and detrimental to our long term well being.
- -Fixing or working on real world things brings intrinsic joy. Good teachers love students and want them to become the best version of theirselves. Similarly, most good mechanics love cars. There is a certain kind of pride that comes with working on a national brand like Rolls Royce but that joy can get diminished if the parts belonging to the car can come from anywhere in the world.
- -Finding joy in fixing things
- -Being able to repair things requires of us to think of what a machine needs rather than what we need. In a way, this suspends our narcissistic way of living and consider what the world around us needs. As I wrote before, the dichotomy is not whether a job is manual or not, it is whether a job is meaningful or not. Being self reliant is a liberating feeling and agency driven autonomy is directly linked to happiness. The fact that people want to take up knitting or grow their own mushrooms is in a way descriptive of how further we’ve gone away from our work and how we, in our soul, want to gain some more agency and responsibility of our things.
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-Iron Man in Avengers, talks to a tractor like its a person
The reason we don’t fix our own stuff is because of harped on notion of opportunity cost but in reality, the pride we feel after being curious and getting our hands dirty far outweighs the loss in opportunity cost. This opportunity cost nonsense is based on the fungibility of human experience. That any activity can be boiled down in terms of the seconds on the clock, is wrong. To fix ones own car is not to use up time but rather to have a different experience of time, self and car. Things now a days are being made so as to encourage us not to tinker with them. This is driven by economics, globalisation but also by changing behaviours of consumerism. A good example of this is people playing musical instruments far less now and listen to music on stereo more. Instruments require effort to master while stereo makes music instantly available. Art requires human engagement v a device that requires consumption.
- -Ethics and cognition
- -Degrading of work in the way of not getting things repaired or the economics of factory stuff being cheaper but also of less quality, has directly led to moral degradation. The world now pays less attention to the craft and its economic effects are there for everyone to see. It is quite normal today for one to walk to a garrage and find mechanics spending less time looking for faults or fixing rather than replacing parts. This is because the economics of replacing parts is better than fixing them. This throwaway culture persists because we don’t have the patience to listen to the machine tell us of what ails it. We make snap judgements because we don’t care about the machine enough. This is a moral failure. The author also speaks about the service manual as a social technology and talks about a world where the manuals were pieces of art, written to be read and understood by everyone who wanted to not only use the machine but also to fix it. This is in stark contrast to the modern day manuals that are written more out of legal reasons. This is also a type of moral failure that feeds into the throwaway culture.
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I run a startup called Harmonize. We are hiring and if you’re looking for an exciting startup journey, please write to jobs@harmonizehq.com. Apart from this blog, I tweet about startup life and practical wisdom in books.
]]>I run a startup called Harmonize. We are hiring and if you’re looking for an exciting startup journey, please write to jobs@harmonizehq.com. Apart from this blog, I tweet about startup life and practical wisdom in books.
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