Systems Thinking Focal Lengths

One of the keys to a successful application of a systems thinking approach to any sort of analysis is the ability to understand systems operating within a very wide or very narrow focus. Sometimes you have to zoom out to see the macro-level system and then zoom in to understand systems at a more micro level.

“Micro” is relative, of course. Sometimes “micro” can refer to a cross-sector supply chain. Boston Consulting Group (BCG) provides an outstanding case study by David Young et al looking at the supply chain for raw materials for a wind power OEM through a systems lens using their SWITCH-GT Systems Workbench.

In this example, BCG illustrates the need for looking at demand for manufacturing inputs across multiple industries such as solar, storage, auto, buildings, and aviation rather than focusing solely on the wind industry. Such an analysis may lead a manufacturer to select a different material due to a potential shortfall of their first option, which could then have cascading effects among a different set of players.

At Tilt Global, we agree wholeheartedly with BCG’s statement that a “systems lens offers [corporate leaders, policymakers, and investors] the broadest possible view of energy transition dynamics—which in turn will help them make better decisions for businesses and for the planet.”

In our Decision Making Lab, leadership teams apply our PRISM systems framework to analyze current context at a macro level across five dimensions – Public Policy, Resource Availability, Institutions, Science & Technology, and Market Systems. Just as BCG stresses the importance of analyzing demand for raw materials across sectors in their case study, PRISM requires understanding of the interactions of the five dimensions among one another. For example…

➤ How might public policy impact scientific and technical innovation?
➤ How do institutions like traditional industry business models constrain or create opportunities within market systems?
➤ How does increased consumer demand in a market system, driven by a new technology, cascade into changes in demand for resources like a workforce skilled in a particular area?

Leadership teams can use PRISM to perform a macro-level strategic contextual analysis and tools like BCG’s SWITCH-GT to dive into the micro-level systemic details within a specific PRISM dimension.

Suffice it to say, we like the way BCG thinks.