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Home > Organizational Basics
Reading Systems Diagrams
by Bob Powell,
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A story about Outback Steakhouse(TM)

Systems thinking tells stories. As an example, consider a saying by Yogi Berra and the corresponding causal loop diagram: "That place is too popular.  Nobody goes there anymore." Though actually lots of people go there, very few compared to the number that have gone there, many of whom are unwilling to endure the wait for a table.

A causal loop diagram, the language of systems thinking.
Follow the arrow links to read the diagram. An "S" means a change in the "Same" direction; and "O" means a change in the opposite direction. One can start anywhere around the loop.

  • More "customer traffic" creates a longer "length of line."
  • A longer "length of line" creates more "wait time."
  • More "wait time" results in lower "service quality." [Note "wait time," compared to "expected wait time," determines "service quality." The greater the "expected wait time," the better the "service quality."]
  • Lower "service quality" results in lower "perceived service quality" ... after some delay. That is, it takes us time to perceive that the service quality is lower.
  • After some delay (that is, after this happens to some people one or more times), less "perceived service quality" results in less "customer traffic."

In this example we started with more "customer traffic" and completed the loop with less "customer traffic." The diagram's "story" can also be told in the opposite sense, starting with less "customer traffic," etc., and ending with more "customer traffic."

This is an example of a "goal-seeking" balancing loop, where going entirely around the loop creates an influence that counteracts the initial change.  Another example is a home heating system with a thermostat; in this case "expected wait time" is analogous to the thermostat setting. A thermostat-like reference is present for all balancing loops, either explicitly or implicitly (it's best to show it explicitly). This diagram shows that "customer traffic" increases until "wait time" equals the "expected wait time." If "wait time" increases above the "expected wait time," the influence will cause "customer traffic" to fall back to a level where "wait time" equals "expected wait time" .... and perhaps then oscillate about that level (... the oscillation could be damped or undamped).

For a reinforcing loop, going around the entire loop produces an action in the same direction as the original action ... it produces an increasing or decreasing response (an increasing feedback example is the squeal of sound system feedback). Reinforcing loops are two-edged swords; they can be either virtuous or vicious cycles.

A Brief Introduction to Systems Diagrams (119K)

URL: http://www.exponentialimprovement.com/cms/PracticalST.shtml

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