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Outcome vs. System Thinking and Strategy

Updated: Jan 11

Do you find yourself and your team encountering the same problems repeatedly? How are you evaluating your strategy? In his book Loonshots: How to Nurture the Crazy Ideas that Win Wars, Cure Diseases, and Transform Industries, Safi Bahcall explains the three levels of strategic analysis: none, outcome thinking and strategic thinking. This can be applied both to work, as I described in the video, and to our personal lives.

Say you got in an argument with your spouse, relative, or friend.

  • No strategy is you don’t reflect at all on what caused the argument, which may lead to repeating the argument in the future.

  • Outcome thinking strategy would have you look at what happened - what decisions did you make? What was the argument about? How heated was it? From this you may conclude, I’m going to avoid that topic at all costs in the future.

  • Systems thinking strategy would have you analyze how you made the decisions that you made. How were you and the other person feeling before the argument began? How did that influence the communication pattern? This may lead you to be more thoughtful about how and when you bring the subject up in the future so you can have a meaningful discussion.

As you are evaluating a problem at work, here are some questions from the book that can deepen your evaluation of the decisions that led to the result.

  • How did we arrive at that decision?

  • What mix of people were involved and should they be involved in a different way?

  • Should we change how we analyze opportunities before making a similar decision in the future?

  • How did the incentives we have in place effect our decision making? Should those be changed in the future?

When I worked for Procter & Gamble, every event, launch, and process was evaluated for what worked, what didn't, and what we should do differently the next time. You may think there's no need to evaluate successes. From a systems thinking perspective, that would not be a good idea. What if your decision making process was faulty and you just got lucky? How would you know? If your results were earned, how will you know what you can apply to other processes in the future?

Likewise if you don't evaluate your failures, you may discount a perfectly sound decision making process that didn't work this time due to sheer chance. For example, if you had a one in three chance of winning the lottery if you bought a ticket, you bought one, and your lost, was your reasoning bad? What's the risk reward balance that would make you make a different decision in the future?

Loonshots is a highly entertaining, clear, and thought provoking book that I highly recommend. If you want to discuss outcome vs system thinking and it's impact on strategic success, book a free consultation!

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