Systems thinking and thinking systems

Russell L. Ackoff

Three types of sys- A system is a whole consisting of two or more parts (1)each of which can affect
tem are identified the performance or properties of the whole, (2) none of which can have an
and differentiated:
mechanical, organis- independent effect on the whole, and (3) no subgroup of which can have an
mic, and social sys- independent effect on the whole. In brief, then, a system is a whole that cannot
tems. The evolution be divided into independent parts or subgroups of parts.
of our concept of an
enterprise from
mechanical to social
is then traced, as Alternative views of a system
enterprises are
viewed from each of
these perspectives. Systems are of three types: mechanical, organismic, and social.’ A mechanical
Some consequences system is one that operates with a regularity dictated by its internal structure
of conceptualizing and the causal laws of nature, for example, a clock or an automobile. Because
them as social sys-
tems are then dis- mechanical systems can display no choice, they can have no purposes of their
cussed, including own; nor can their parts. However, a mechanical system can have a function,
the consequences of which involves serving the purposes of an entity external to it, and its parts can
(1) considering the
parts of an enter-
have subfunctions. Therefore, when the universe was conceptualized as a
prise separately, as machine by Newton, it was taken to have been created by God to do God’s
is commonly done, work. At a smaller scale, an automobile is a mechanical system that has no
that is, managing purpose of its own but serves its driver’s purpose by functioning as a means of
analytically versus
synthetically; (2) transport. In addition, the fuel pump in an automobile has the function of
supervising person- supplying the motor with fuel.
nel who can do their Mechanical systems are either open or closed; closed if their behavior is
jobs better than their
bosses; (3) treating unaffected by any external conditions or events, open if they are so affected.
problems separately Therefore, the universe was seen by Newton as a closed (self-contained)
rather than system- mechanical system, with no environment. On the other hand, the planet Earth
ically, and (4)
taking disciplines as
was seen as a system whose motion was influenced by other planets, stars, and
aspects of reality, so on; hence it was conceptualized as an open system.
that is, as categories Those parts without which a system cannot perform its function are essen-
of nature. tial; the others are not. For example, the engine of an automobile is essential; its
cigarette lighter is not.
Russell L. Ackoff is Organismic systems are ones that have at least one goal or purpose of their
chairman of the own-for example, survival, for which growth is often taken to be essential-
board of INTERACT,
the Institute for In- but their parts have no goal or purpose; however, they have functions serving a
teractive Manage- goal or purpose of the whole. Organismic systems are necessarily open, subject
ment. He received to external influences; therefore, they can only be understood when considered
his Ph.D. degree in
the philosophy of
in connection with their environments. The environment of any system con-
science from the sists of the set of variables that can affect the behavior of the system.
University of Penn-
sylvania. He is
Anheuser-Busch Pro-
fessor Emeritus System Dynamics Review Vol. 10, nos 2-3 (Summer-Fall 1994): 175-188 Received March 1993
@ 1994 by John Wiley 81 Sons, Ltd. CCC 0883-7066/94/020175-14

175
176 System Dynamics Review Volume 10 Numbers 2-3 Summer-Fall 1994

of Management The parts of an organismic system may be either essential or not. The heart of
Science, the a person, for example, is essential, but a fingernail is not.
Wharton School,
University of Penn- Social systems-of which organizations, institutions, and societies are
sylvania, and August examples-are open systems that (1)have purposes of their own, (2) at least
A. Busch, Jr., Visit- some of whose essential parts have purposes of their own, and (3) are parts of
ing Professor of
Marketing, John M.
larger (containing) systems that have purposes of their own.
Olin School of Busi- Mechanical, organismic, and social systems are concepts as well as entities.
ness, Washington Therefore, we can think of any entity as any of these types of system; for
University in St. example, a business, school, or hospital can be conceptualized as a machine, an
Louis. He has written
nineteen books and organism, or a social system. However, my view is that systems in which
worked in research, people play an essential role cannot be well understood, hence managed, if
consulting, and edu- viewed other than as social. The way that peopled systems have been viewed
cation with more
than 250 corpora- has evolved over time. For me, this is most dramatically illustrated by the
tions and 50 govern- changes in our way of thinking about enterprises. However, the same evolution
ment agencies in the pertains to every other type of social system.
United States and
other countries.
Address: INTERACT,
401 City Avenue, The enterprise as a machine
Suite 525, Bala When the Industrial Revolution began in the Western world, the prevailing
Cynwyd, PA 19004,
U.S.A. worldview was Newtonian. In addition to the belief that the universe was a
machine created by God to do God’s work, human beings were believed to have
been created in the image of God. It followed, then, that people should be
imitating God: creating machines to do their work. Little wonder that business
enterprises were thought of as machines created by their gods, the owners, to
do their work. These systems were not endowed with any purposes of their
own, but they were taken to have the function of serving their owners’ purpose:
to provide them with a return on their investment by making a profit.
Owners were all-powerful and omnipresent, virtually unconstrained by laws
or regulations. They could do whatever they wanted within their enterprises.
They treated their employees as replaceable machine parts that could easily be
discarded once they no longer functioned satisfactorily. Work required little
skill, and unskilled, uneducated workers were plentiful. They had relatively
low levels of aspiration and virtually no social security other than that pro-
vided by their families. For these reasons they were willing to work under
almost any conditions, and they had to in order to avoid economic destitution.

The enterprise as an organism

The mechanistic view of the enterprise became less tenable as the nineteenth
century drew to an end. By the end of World War I, this view had largely been
replaced by an organismic concept of the enterprise. There were a number of
 Ackoff: Systems Thinking and Thinking Systems 177

reasons for this transformation, among them increased education of the work
force; increased skills required of the work force as mechanization increased;
increased regulation of working conditions by government; and the “intrusion”
of unions into the conditions of work, job security, and compensation. Perhaps
the most important reason for the transition was the fact that many enterprises
could not realize their growth potential even if all the profit they generated was
plowed back into them; additional capital was required. Therefore, owners
either had to constrain their enterprises’ growth while retaining complete
control over them, or raise additional capital by “going public,” thereby re-
linquishing some ownership and control. The survival rate of those enterprises
that sought growth rather than control ,was much higher than those that did not.
When an enterprise went public, its god disappeared. Stockholders were
anonymous and unreachable by members of the work force. Ownership became
an abstraction, owners a spirit. How could one communicate with this spirit?
There was a precedent; nineteen hundred years earlier the Western God had
disappeared and become an abstract spirit. In response, an institution and a
profession-the church and its clergy-were created to bridge the gap between
God and those who believed in God. Early in this century, management (the
church) and managers (the clergy] were established to control enterprises in the
alleged interests of their owqers, and to discern and communicate the will
of the owners to the employees. Managers obtained what they claimed as
knowledge of the owners’ will in the same way the clergy claimed to obtain
knowledge of the will of God, by revelation.
Managers, despite their assertions to the contrary, thought of profit as a
means, not an end. Like oxygen for a human being, profit for an enterprise was
thought of as a means necessary for its survival and growth, not the reason for
it. What managers tried to maximize was their own standard of living and quality
of work life, not shareholder value. Providing shareholders with adequate
returns was a requirement for survival, not an objective. For public relation
reasons, however, the myth of profit maximization was preserved.
Publicly owned enterprises came to be called “corporations.” This word
derives from the Latin word corpus, meaning “body.” (Organisms have bodies,
machines do not.) Moreover, in the eyes of the law, the corporation was
endowed with the status of a biological individual. The chief executive came to
be called “the head” of the organization. (Organisms have heads, machines do
not.) Biological adjectives came to be applied to enterprises, for example,
healthy, sick, paralyzed, energetic, mature, and dying. Such concepts are still
commonly used. It was not long ago that Stafford Beer wrote books entitled
Brain of the Firm (1972)and The Heart of Enterprise (1979).
Because of continuing advances in mechanization, the skills required of
workers continued to increase. Workers with the required skills were not as
178 System Dynamics Review Volume 10 Numbers 2-3 Summer-Fall 1994

plentiful as those without them. The cost of training and replacing skilled
workers was not negligible. As a result, they came to be treated more like
difficult-to-replace parts of the body, organs, than easily replaceable machine
parts. The health and safety of employees received increasing attention from
government, unions, and members of the work force. Although the interests
and purposes of workers were not considered to be relevant to their employers,
their functioning was.
The expansion of social security, increases of personal savings (resulting
from increased compensation for work), and union activity reduced the threats
associated with unemployment. These developments encouraged dissatisfied
employees to protest against what they considered to be unfair labor practices
and bad working conditions. Management and labor came to be viewed as
inevitably opposed to each other, much as mind and body were taken to be.
The biological view of the enterprise began to erode during World War 11. At
that time, a major portion of the work force was drafted into military service.
Nevertheless, demands for production were very great. Women, children, and
the elderly were drawn into the work force. (Recall Rosie the Riveter and TiIJie
the Toiler.) These replacements were motivated more by patriotism than by the
need for income. Many were supported by allowances given to dependents of
servicemen. Managers who wanted high productivity from members of this
patriotically driven work force could not get it by treating them impersonally,
as replaceable machine parts or even as functioning but purposeless body parts;
they had to be treated as human beings with purposes of their own.
Because of accelerated mechanization and automation after the war, the
skills and education required of the work force increased at an accelerating rate.
More and more time and money were invested in the education and training of
employees at all levels. In order to obtain a return on this investment, em-
ployees had to be used more productively and for more years. This could not be
done by treating those who had returned to the work force from military
services in the way they had been treated in the military. Autocracy and strict
discipline had become repugnant to them. Ex-GIs wanted to be treated as
unique individuals with needs and desires of their own. This was reflected in
the way they raised their children, permissively. As a result, these baby
boomers were even less inclined than their parents to tolerate autocratic
management.
Most of those in the post-World War I1 permissive (“Spock”) generation
had not experienced a depression and therefore did not attribute as much
importance to material possessions as their parents had. They did not adopt the
Protestant work ethic that characterized preceding generations, and they did
not consider work to be an inherently good thing. Rather, they tended to think
of work as a necessary evil. Recall the hippies of the 1960s and 1970s.
 Ackoff: Systems Thinking and Thinking Systems 179

The members of the permissive generation who went to work, and most of
them eventually did, expected their interests to be taken into account by their
employing organizations. Many managements failed to do so. As a result, large
numbers in the work force were alienated from work and their employing
organizations. According to Work in America, a report submitted to the Secre-
tary of Health, Education, and Welfare in 1973,
. . . significant numbers of American workers are dissatisfied with the quality of
their working lives. Dull, repetitive, seemingly meaningless tasks, offering little
challenge or autonomy, are causing discontent among workers at all occupational
levels. This is not so much because work itself has greatly changed; indeed, one
of the main problems is that work has not changed fast enough to keep up with
the widespread changes in worker attitudes, aspirations, and values. A general
increase in their educational and economic status has placed many American
workers in a position where having an interesting job is now as important as a job
that pays well. Pay is still important: it must support an “adequate” standard of
living and be perceivable as equitable-but high pay alone will not lead to job (or
life) satisfaction. (pp. xv-xvi)
Protest groups, outside as well as inside corporations, proliferated. Con-
sumerists and environmentalists felt that they were being adversely affected
both by organizations of which they were not a part and societies of which they
were a part. These groups held corporations, institutions, and governments
responsible for their allegedly harmful effects on society, its members, and the
environment. They helped force a transformation in the way people thought
about enterprises, business and otherwise.

The enterprise as a social system

Because of internally and externally applied pressures, corporate managers
became aware of the need to take into account the purposes and interests (1)of
the parts of the systems they managed, and (2) of the larger systems that
contained them-for example, society-and other systems that were also
parts of the same containing systems. In addition, managers of enterprises
obviously had to be concerned (3) with the purposes of the system they man-
aged. This expansion of the concerns of managers made it increasingly difficult
for them to think of their organizations as either mechanical or biological
systems. They began to think of them as social systems, systems in which
people individually and collectively played the major roles. These are systems
that (1)have a purpose of their own, (2) are made up of parts that have purposes
of their own, and (3) are parts of larger systems that have purposes of their own
and contain other systems that have purposes of their own. All of these came to
be considered relevant to the enterprise.
180 System Dynamics Review Volume 10 Numbers 2-3 Summer-Fall 1994

Because a system is a whole that cannot be divided into independent parts,

its performance is never equal to the sum of the actions of its parts taken
separately; it is a function of their interactions. It can be shown that when each
part of a system taken separately is made to perform as well as possible, the
system as a whole cannot perform as well as possible (Sengupta and Ackoff
1965). This had extremely important implications for corporate management.
For example, an all-star football team is not necessarily the best team. One
might argue, however, that if its members were given enough time to play
together, they would become the best team. Perhaps, but when they become the
best team, not all of its members would be selected for the all-star team.

Some consequences of a system’s being viewed as a social

system

The performance of a system obviously depends on the performance of its

parts, but an important, if not the most important, aspect of a part’s perform-
ance is how it interacts with other parts to affect the performance of the whole.
Therefore, effective system management must focus on the interactions of its
parts rather than on their actions taken separately.
The defining function of a system cannot be carried out by any part of the
system taken separately. For example, no part of an automobile can transport
people, not even its motor. Therefore, when an automobile or any system is
taken apart, it loses its defining function, its essential properties. A disas-
sembled automobile cannot transport people, and a disassembled person does
not live, read, or write.
Furthermore, when an essential part of a system is separated from the system
of which it is a part, that part may lose the ability to carry out its defining
subfunction. For example, when the motor of an automobile is removed from
that automobile, it cannot move anything, not even itself. A steering wheel
removed from a car steers nothing. A hand removed from a body cannot hold
anything.
A system can affect its parts in two ways: by either increasing or decreasing
the variety of behavior they can display. Since social systems contain purpose-
ful systems as their principal parts, and purposeful behavior consists of choices
of ends and means, social systems must either increase or decrease the variety
of choices available to their parts. They may increase the variety’ of some types
of behavior, and reduce that of others. Laws, for example, may enable us to
acquire property but not to take it from another.
An autocratic social system in general reduces the variety of behavior avail-
able to its parts; a democratic system increases it.
 AckoE Systems Thinking and Thinking Systems 181

Synergy is an increase in the value of the parts of a system that derives from
their membership in the system, that is, from their interactions with other parts
of the system. Such an increase in value can obviously only occur if the parts
can do something of value together that they cannot do alone. Put another way,
synergy requires an increase in the variety of behavior available to the parts of a
system.
If social systems had no effect on the choices available to their parts or to the
wholes of which they are part, study of these systems as wholes would have
no value; we would only need to study their parts taken separately. There-
fore, to understand social systemic behavior, we must study the interactions of
their parts and of the whole with other systems with which it forms larger
systems.
Whether a system increases or decreases the variety of behavior available to
its parts depends on how it is organized and managed. An enterprise concep-
tualized as a machine is organized and managed so as to severely restrict the
behavior of its parts. The effectiveness of a machine depends on its ability to
keep its parts doing the same thing(s) over and over again. The behavior of its
parts is physically determined; they display no choice. It is just such behavior
that we associate with bureaucracies, which, of course, are mechanistically
conceived organizations.
A social system conceptualized as an organism may provide its parts with a
greater variety of choices than one conceptualized as a mechanical system, but
such variety does not affect the functioning of its parts, only the way they carry
them out.
In our bodies, for example, the heart may beat at different rates, but it must
pump blood through the system. Put another way, in an organismically con-
ceptualized system the parts may display a larger variety of behavior than the
parts of a machine, but they cannot change the functions they perform. There-
fore, in an enterprise that is managed as a biological system, workers at all
levels are assigned (do not choose) objectives or outputs, but they can pursue
them in a variety of ways.
An enterprise conceptualized as a social system should serve the purposes of
its parts and the system of which it is part. It should enable its parts and its
containing systems to do things that they could not otherwise do. This means
that social systems should increase the variety of both the means and ends
available to their parts and the systems of which they are a part.
Within an organization there is a close relation between centralization and
reducing variety, and decentralization and increasing variety. The more cen-
tralized decision making is, the less is the variety of choices available to
decision makers below the top; the more decentralized it is, the greater is the
variety of choices available to those below the top.
182 System Dynamics Review Volume 10 Numbers 2-3 Summer-Fall 1994

Analytic versus synthetic management

In our culture, managers are educated to believe that a social system’s perform-
ance can be improved by improving the performance of each of its parts taken
separately-that is, if each part is managed well, the whole will be. This is
seldom if ever the case, because parts that appear to be well managed when
viewed separately seldom fit together well. At best, managers learn how to
manage the actions of parts of a social system, but effective managers manage
the interactions within the part of the system for which they are responsible
and the interactions of that part with other parts within or outside the organi-
ation that it affects and by which it is affected.
The predisposition to take things apart and treat the parts separately is a
consequence of analytic thinking. Unfortunately, analysis and thought are
frequently treated as synonyms, but analysis is only one way of thinking;
synthesis is another. Few managers are aware of this alternative, let alone how
to use it.
In analysis, something to be understood is first taken apart. Then an effort is
made to understand the behavior of each part taken separately. Finally, under-
standing of the parts is aggregated in an effort to obtain understanding of the
whole. Synthesis is exactly the opposite. In the first step, the thing to be
understood is taken as a part of a larger whole (hence is put together with other
things, not taken apart). In the next step, understanding of the larger contain-
ing system is obtained. Then the behavior or properties of the system in
question is explained by revealing its role or function in the larger system that
contains ita3
Understanding of a system cannot be obtained by analysis. Analysis of a
system reveals its structure and how it works. Its product is know-how, knowl-
edge, not understanding. Although it cannot explain the behavior of properties
of the whole, it can explain the behavior of the parts by revealing their role or
function in the whole. The same must be done to explain the whole; its role
or function in the larger whole of which it is a part must be identified. For
example, no amount of analysis of American and English automobiles can
explain why they are driven from different sides. Nor will any amount of
analysis of American cars explain why for years most of them were built for six
passengers until recently, when they began to be built for four passengers.
A system is a whole whose essential properties are not shared by any of its
parts. For example, no part of an automobile by itself can transport a person
from one place to another, nor can any part of a person live by itself. Therefore,
when a system is disassembled, as it is when analyzed, it loses its essential
properties. Furthermore, when a part of a system is separated from that system,
that part loses its essential properties. An automobile’s engine cannot move
 Ackoff Systems Thinking and Thinking Systems 183

even itself when removed from the car. No part of a human being can operate
normally when separated from the body; a separated hand cannot write, and a
separated eye cannot see.
When analysis reduces a system to its parts, it loses that system’s essential
properties. And when it considers the parts separately, it loses their essential
properties. But if it considers the parts as parts of the whole-that is, their
functions and roles in that whole-it can capture their essential properties
and explain their behavior. Despite all this, most managers treat analysis and
synthesis as synonymous, and their products-knowledge and understanding-
similarly.

From management to leadership

It has been estimated that in 1900 over 90 percent of those employed in
business and industry could not do their jobs as well as their bosses could. This
has great significance. Think about it. Imagine that a company back then had a
group of people operating drill presses in a factory. Their foreman retired. The
company needed to replace him. Who would its managers pick? Obviously, the
best drill press operator. He became a foreman who could operate a drill press
better than any of his subordinates. Now a shift supervisor was needed. The
best foreman was picked for the job. So, in general, back then people moved up
organizational ladders by being excellent performers. Therefore, when they
moved up, they managed those doing what they last had done so well. Because
of this, they supervised the work of their subordinates.
In 1900 the average educational level of the factory worker in the United
States was very low. Today it is much higher. It has been estimated that at least
90 percent of today’s workers can do their jobs better than their bosses can. In
my case, it’s 105 percent. I can’t do what any of my subordinates do as well
as they can, whether it be statistics, economics, computer programming, math-
ematics, engineering, or shorthand. I can’t even operate the fax machine as well
as they do. My job clearly is not to supervise them. Then what is it?
Today’s manager has three principal functions. Until they are fulfilled, we
are not going to get the quality of output to which we aspire. The first is to
create an environment in which our subordinates can do as well as they know
how. One company in Europe has tried to estimate the average percentage of its
employees’ relevant capabilities they were able to use in their work. It esti-
mated 30 percent. If a company used any other resource that poorly, it would
not survive.
The principal financial function of management should not be, as it often is,
to maximize the return on the capital it employs but the return on the labor it
employs. Until corporations learn how to use their employees effectively, they
184 System Dynamics Review Volume 10 Numbers 2-3 Summer-Fall 1994

will have serious quality problems. How to do so is too large a subject to go

into here, but let me point out one requirement. We will have to get rid of job
descriptions. They limit what people are allowed to do at work and prevent
them from using all they know in what they do. Furthermore, the descriptions
are based on the assumption that those who prepare them know better how to
do the job than those who have to do it. This assumption is generally false. We
have to organize work so as to enable people to do as well as they know how.
Second requirement: we have to enable employees to do better tomorrow
than the best they can do today. To do this is to develop them. Development of
a business and its stakeholders should be its principal objective. Unfortunately,
most managers take development and growth to be the same thing. Many
corporations have a unit whose responsibility is said to be development. What
does it work on? Acquisitions, joint ventures, divestitures-in a word, growth.
Growth is an increase in size or number. Development has nothing to do with
either. Cemeteries grow but do not develop; rubbish heaps also grow but do not
develop; however, Einstein continued to develop long after he stopped grow-
ing. Development is an increase in our ability and desire to satisfy our own
needs and legitimate desires, and those of others. A legitimate desire is one the
satisfaction of which does not reduce the ability or desire of any others to
satisfy their needs or desires. The Spanish refer to development as capacitation.
This captures its meaning.
Therefore, the second fundamental responsibility of managers is to develop
those for whom they are responsible. Managers must become educators because
education is the means to development. Quality can be improved more by
education than it can by supervision.
The third fundamental function of managers is to manage (1)the interactions
of those for and to whom they are responsible, (2) the interactions of their units
with other units of the organization, and (3) the interactions of their organizations
with other organizations in their environments. We need a type of organization
that facilitates such management. The conventional autocratic hierarchy found
in most corporations does not do so. Democratic hierarchies are required, and
they exist. They are called circular organizations (see Ackoff 1989).

Problems and messes

One of the most damaging misconceptions plaguing management is that prob-

lems are objects of direct experience. Not so. They are abstractions extracted
from experience by analysis. Problems are related to experience as atoms are to
tables. Tables are experienced, not atoms. Managers are not confronted with
separate problems but with situations that consist of complex systems of
strongly interacting problems. I call such situations messes.
 Ackoff Systems Thinking and Thinking Systems 185

Therefore, the behavior of a mess, and a mess is a system, depends at least as

much on how its parts interact as on how they act independently of each other.
However, it is standard managerial practice to reduce messes to aggregations of
problems: to prioritize and treat them separately, as self-contained entities.
Managers do not generally know how to deal effectively with any system, let
alone messes, taken as a whole. Effective managers do not solve problems;
they dissolve messes. Ineffective managers mismanage rather than manage
messes.

Ways of treating problems and messes

There are four very different ways of dealing with problems and messes in the
real world.

ABSOLUTION. To ignore a problem or mess and hope it will take care of itself or
go away of its own accord.

RESOLUTION. To do something that yields an outcome that’s good enough, that

“satisfices.” This involves a clinical approach to problems or messes, one that
relies heavily on past experience, trial and error, qualitative judgment, and so-
called common sense. It focuses more on the uniqueness of a problem or mess
than on its generality.

SOLUTION. To do something that yields or comes as close as possible to the best

possible outcome, that “optimizes.” This involves a research approach to
problems or messes, one that relies heavily on experimentation, quantitative
analysis, and uncommon sense. It focuses more on the general aspects of a
problem or mess than on its uniqueness.

DISSOLUTION. To redesign either the entity that has the problem or mess, or its
environment, in such a way as to eliminate the problem or mess and enable the
system involved to do better in the future than the best it can do today, in a
word, to “idealize.” It focuses equally on the generality and uniqueness of a
problem or mess, and it employs whatever techniques, tools, and methods-
clinical or scientific-that can assist in the design process.

The difference between solutions and dissolutions is illustrated by the follow-

ing simple example. Placing the instruction “Close Cover before Striking” on
the front of old matchbook covers to prevent a flying spark from igniting the
matches it contained constituted a solution to the problem. When the abrasive
was placed on the back of the matchbook rather than on the front, the problem
was dissolved.
186 System Dynamics Review Volume 10 Numbers 2-3 Summer-Fall 1994

Problems and disciplines

One of the greatest disservices of formal education lies in the fact that students
are induced to believe that every problem can be placed in a disciplinary
category, such as physical, chemical, biological, psychological, sociological,
political, or ethical. In business schools, problems are placed in such categories
as financial, personnel, public relations, production, marketing, distribution,
and purchasing. However, there is no such thing as a disciplinary problem. The
world is not organized the way universities, colleges, and schools are, by
disciplines. Disciplinary categories reveal nothing about the nature of the
problems placed in them, but they do tell us something about the nature of
those who place them there. This is apparent in the following example.
Several university professors were meeting with leaders of a self-
development program being carried out in a nearby neighborhood. The neigh-
borhood was occupied almost exclusively by members of a disadvantaged
minority. A member of the community broke into the meeting with bad news.
That morning an 83-year-old woman who had lived in the neighborhood and
had been very actively involved in its development had died. That morning she
had gone to the area’s only free health clinic for her monthly checkup, was told
she was fine, and left to go home. While climbing the third flight of stairs on her
way to her fourth-floor rooms, she had had a heart attack and died.
The room became silent. The silence was eventually broken by the professor
of community medicine, who said: “I told you we need more doctors at the
clinic. If we had them, we’d be able to make house calls and this sort of thing
wouldn’t happen.” After a pause the professor of economics said, “You know,
there are plenty of doctors who make house calls, but they’re in private
practice; therefore, they cost money, and she couldn’t afford one. If welfare or
medical benefits of senior citizens were larger, this wouldn’t have happened.”
The professor of architecture then asked why elevators weren’t required in all
multiple dwelling units of more than three floors. Finally, the professor of
social work pointed out that the old woman had a son who was a successful
lawyer and lived in a spacious suburban bungalow with his family. If the
woman and her son had been on speaking terms, she would have been living
with him, would have had no stairs to climb, and would have had all the
money she needed to call a physician in private practice.
Was this a medical, economic, architectural, or social work problem? None of
the above. It was just a problem. These adjectives connote the point of view, the
mind set, of the person looking at the problem, not something about the nature
of the problem.
The effect of categorizing problems by disciplines is that they then tend to be
attacked only by people in that discipline. When, for example, a problem is
 Ackoff: Systems Thinking and Thinking Systems 187

categorized as “marketing,” it tends to be retained within the marketing depart-

ment. However, it is important for managers to know that the best place to treat
a problem is not necessarily where it appears. For example, one company’s
production scheduling problem was dissolved by changing the incentives
offered to the sales staff. This resulted in a mix of products sold that reduced
production costs and increased corporate profits much more than could have
been obtained by manipulating the production schedule. In another case, a
severe production problem caused by the seasonality of sales of the company’s
principal product was dissolved by adding a product to its product line that
required the same technology of production and distribution channels but the
demand for which ran counter to that of the principal product.
Not all ways of viewing a problem are equally productive, but the one that is
most productive is seldom obvious. Therefore, problems should be viewed
from as many different perspectives as possible before a way of treating them is
selected. The best way often involves collaboration of multiple points of view,
a transdisciplinary point of view. Unfortunately, universities and colleges dis-
courage interactions between disciplinary departments, and they frequently
penalize faculty members who try to interact. Students get a message from this
that is both strong and wrong.

1. Editor’s note: For an early and rich development paralleling these systems
distinctions, see Karl Deutsch, Toward a Cybernetic Model of Man and Society,
Synthese 7 (1948):506-533, reprinted in W.Buckley, Sociology and Modern
Systems Theory (Englewood Cliffs, N.J.: Prentice Hall, 1967).A discussion of the
significance of the concepts of open and closed systems is contained in L. von
Bertalanffy, The Theory of Open Systems in Physics and Biology, Science 3
(1950):23-29. See also L. von Bertalanffy, General System Theory: Founda-
tions, Development, Applications (New York: Braziller, 1968), and J. G.Miller,
Living Systems (New York: McGraw-Hill, 1978).
2. I use variety in its usual dictionary meaning, not in the sense in which Ashby
used it.
3. Synthesis does not mean “studying a whole as a synthesis of its parts” but
“studying a whole as part of a larger system.” Simulation of the behavior of the
parts of a system may provide understanding of the behavior of the parts but not
of the whole.

References

Ackoff, R. L. 1989.The Circular Organization: An Update. Journal of the Academy

of Management Executives 3 (1):11-16.
188 System Dynamics Review Volume 10 Numbers 2-3 Summer-Fall 1994

Beer, S. 1979.The Heart of Enterprise. Chichester, U.K.: Wiley.

. 1981. Brain of the Firm. 2d ed. Chichester, U.K.: Wiley. Originally pub-
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Sengupta, S. S., and R. L. Ackoff. 1965. Systems Theory from a n Operations
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