Systems Thinking
(Why Great Directors Think in Circles, Not Just Lines)
In a world of increasing complexity, linear thinking is no longer good enough. Board directors must learn to see not just the decision in front of them, but the system around it. That’s where systems thinking comes in. It means looking beyond immediate consequences to understand long-term impacts, feedback loops, and unintended outcomes. At its core, systems thinking is about understanding how things connect.
Rather than asking, "What should we do?" systems thinkers ask, "How will this choice ripple across the system?"
They also ask "What if?" and "So what?" repeatedly. These questions are critical in surfacing potential ripple effects, unintended consequences, and long-range impacts. What if the market shifts? What if stakeholders push back? So what happens if this initiative succeeds faster than expected? Or fails more quietly than we planned for? Systems thinkers play out scenarios to understand both opportunity and risk in a more nuanced way.
Three Systems Thinking Questions for Directors
Great directors have key questions in their tool box. Here are three that I’ve seen colleagues use masterfully when exploring a board decision:
"Who or what is downstream from this decision?"
Every choice flows somewhere. Who will feel the impact six months from now? What unintended effects might show up later?"What are we solving for—and what might we be shifting out of view?"
Systems thinking reveals trade-offs. Are we solving a short-term pressure while creating long-term friction elsewhere?"Where have we seen this pattern before?"
Systems tend to repeat themselves. Looking at past system failures or successes can reveal current blind spots or opportunities.
Final Thought: Governance Is a System, Too
The board itself is part of the system. Director dynamics, incentives, reporting structures—they all influence how decisions are made and how information flows. That’s why systems thinking isn’t just a strategy tool—it’s a governance mindset.
Great boards don’t just ask, “What should we do?”
They ask, “What will this decision set in motion?”
Because in governance, as in nature, every move creates a ripple. And great directors know how to read the water.