there are two ways of looking at the world in parts or as a whole now most of us have been trained to think in parts right take something complex break it down into its individual components study each in order to understand what is happening in the more complex worlds our schools are set up this way we have subjects like english math biology chemistry physics and we look into each one of them in order to understand what the world is like but as aristotle says the whole is more than the sum of its parts and usually it's in the connection between the different subjects between the different parts the relationships between those that really signifies how something actually works so that's where systems thinking come in we'll use six mental models to understand problem as a whole as well as identify the cause and not just treat the symptoms hi everyone it's vicki if you're new here i talk about clear thinking clear communications through frameworks and mental models and today we'll kick-start these six mental models in system thinking with the first one which is linear versus non-linear organization now in linear thinking which most of us are very familiar with it's reducing things down to if then so if a happens and then b happens and then c happens so this is kind of what excel spreadsheets are built to be like where we move in sequence and everything is linear but as we know the world is not like that the world is very dynamic things affect each other all the time and it's really hard to pin something down into a very linear fashion a non-linear way of thinking could be that a feeds into b which feeds into c which then feeds into a so it becomes more of a cycle instead of a than b than c there's a documentary on netflix that's actually a really good non-linear example of how the world organizes itself it's called the biggest little farm it follows a couple molly and john with their dog moving from l.a to a farm that used to be used for exclusive berry farming single planting of the berries farm sucked all of the nutrients out of the farm so the couple is trying to bring the farm back to life and introduce biodiversity so they have more sustainable organic farming that feeds the local community for example they will plant cover crops like citrus trees where they will be able to bring more nutrients and water back into the soil that used to be felt but they quickly realized that these cover crops then attracted pests like snails that infested their whole cover crop garden they also raised farm animals like cows and sheep in order to use the manure to give nutrients to the fallow soil but then the manure attracted a huge fly overpopulation and they didn't know what to do with that they also had a pond with ducks and fish and everyone was getting along swimmingly but then a drought hit and the duck droppings into the pond that has less water now created toxic algae which then killed the fish and so molly and john realized that all these parts weren't working separately they were working together it's not a linear problem when they realized that there's actually interconnection between all of these seemingly separate problems they were able to resolve it really easily and quickly for example the chickens they bought to lay eggs to sell at the farmers market turns out they really like to eat the maggots in the manure that turned into fly which contained their flyover population the ducks are creating the problem in the pond with the toxic algae well it turns out that they really love to eat the snails that were infesting the cover crops and because they came on land then their droppings actually became fertilizer for the cover crop rather than poisoning the fish in the pond many systems are actually organically anti-fragile and all we need to do is see the interconnectedness so we can allow the solution to happen so a quick exercise is to draw non-linear connections between different elements of a system that you're working with instead of linearly thinking about things like one then two then three then fourth and five put them out on a page and start to see if there are any interconnections between all the different elements of your problem now you might be thinking wait a second this sounds pretty complicated what do i do how do i even know what to put on the paper in order to map out non-linear processes well that actually leads to mental model number two stock and flow this is understanding systems in just two parts stock and flow so let's take the stock first which are the things in the system that can be added or subtracted so in the example of the farm this is the animals the humans the plants the soil the water right the money that's being made these are the things that make up the farm all of them can be added or subtracted then there's the flow so these are the actions that change the number of stock so in the farm example selling something is flow let's say you sell lemons right so you by selling the lemon you decrease the amount of lemons and you increase the amount of money made by the farm so selling here is the flow this will help you simplify the world there are only two things you need to look at right the stock are the things and the flow connects the things together now you might say that sounds really simple and probably everyone can do it so what is the competitive advantage i can have by thinking in systems and to that we move on to number three the iceberg model the iceberg model identifies the four levels of realities you are seeing as a systems thinker one event two patterns of behavior three systems and four mental models most of us only see events happening in the firm example it's a simple to see the event right there are snails on the citrus tree that is the problem so let's pick off the snails and this is classic treating the symptoms not the cause it's easy to do but the problems usually come back so we look deeper to the second level which is the patterns of behavior and here we add the element of time so over an extended period of time what has been happening what is the pattern now for the farm molly and john keeps on seeing that every time they introduce something there's always a problem every time they introduce another solution there is a new problem so looks like there's something structural going on here and that's the next level systems right what are the structures in place that connect everything together what's causing the patterns and for the farm the structure is biodiversity john and molly wanted to introduce biodiversity sustainable farming or organic farming to that fallow farm and by introducing biodiversity they kept on creating new problems because every time they introduce something new there's new prey and there's new predators so naturally you ask why is biodiversity a structure of this farm right and that takes us to level number four mental models i've introduced mental models in more detail in these videos here and i'll link them in the description so you can check them out later but here let's just summarize that with what are the assumptions what are the beliefs what are the values that's shaping this system and for the farm the mental models use our biodiversity is going to create sustainable organic farming that help us humans live in harmony with nature instead of trying to control the environment and there lies the clue to the solution of all the problems of the snail investigations of the flyover population of the duck droppings in the pond right is that you're not supposed to control the environment it's not about how do you control the snail population right it's looking for how nature deals with snails which turns out to be the ducks that are already on the farm right that likes to eat these snails and by just making that connection instead of hiring full-time staff who goes by hand picking these snails off the trees they have ducks doing the work for them for free and fertilizing the soil at the same time and that's because you've gone and analyzed the four levels of realities coming to the end of the mental models which help you understand the cause of the problem and not just fix the symptoms so now you might be thinking okay everything makes sense in theory but where do i even start you know how do i find that event first that helps me then analyze the next three levels where do i start and that brings us to mental model number four finding the bottleneck the system is only as strong as its weakest part and i've talked about this in this video here that you can check out later but quick summary you want to be looking for the bottlenecks of a system a place where things get stuck and there is delay again you are putting things in your perspective with time so for the farm let's look for the bottleneck right bottleneck is delay and here is you know turning a profit on the farm what is delaying them profiting from all of the crops all of the animals that they've raised now it turns out on the farm 70 of their crops are destroyed by pests and at a glance this wasn't the only problem right they had chickens that laid eggs that were super popular at the farmers market but they just didn't have enough chickens to sell more eggs to fulfill the demand so also that's slowing down profit also is the soil not being fertile enough to plant more crop that's also a problem also they don't have enough talent that knew enough about biodiversity in farming so that's also slowing them down so while there are many problems that exist you want to find the bottom neck right the weakest link in the chain and with all of the problems the biggest one is the pests that's destroying 70 of the crop and you may need the 80 20 rule or some other mental model to help you prioritize which problem is your biggest bottleneck i won't talk about it here you can check out this video on 80 20 rule if you're interested now let's say you've identified the bottleneck right you've used the iceberg model you've used the non-linear organizational thinking you've applied the stock and flow the next question is the solutions that i'm coming up which one should i go for how can i tell if the changes i want to make is going to have the intended effect because again right things are interconnected things are complicated how do i know and i've got you covered with mental model number five which is second order thinking most of us think in first order right if i do this then this other thing happens right linear thinking sounds familiar right but we want to move beyond that and go to second order thinking second order thinking is about finding the implications to the first order actions so let's go back to that farm example right first order thinking would be the soil is fallow there are new nutrients there so if i plant cover crops that will help bring back nutrients and water into the soil second order thinking though is okay the soil is fallow right we want to plant cover crops to bring back the nutrients and water what will happen then right that will change the environment which means what we'll probably get bugs and critters in the soil right now that is healthier and what else right snails tend to like cover crop the citrus trees that they're thinking about so if it's likely that by planting cover crops that you'll get some pests you have to be prepared for that and that's second order thinking now clearly this is not something that you just dream of right if you didn't know anything about biodiversity and farming and soil you probably wouldn't know what the pests are what might happen but that's the point is that because most people don't have that knowledge they just stop at first order thinking and then i'll deal with whatever happens next but if you start to think in second order you can start to know what to google what to find out type in what kind of pests do citrus trees attract google won't give you all the answers by thinking the second order you actually find direction as to what you need to know more about now the questions you want to ask yourself first is what are the likely outcome now if you find yourself unable to answer this question it probably means this decision is built on very shallow knowledge right and you have to question am i really making the right decision by trying an action that i don't even know what might be the outcome right that is a big signal for you now the second question is out of all the possible outcomes that may happen which one do i think will occur again this is helping you test right where do i things things will go what do i know about this that leads me to thinking that and if i don't know right is a signal for you to find either more information find someone who's knowledgeable in the field to help you make that decision now the third question is what is the probability that i'm right again it helps you test how much do i know how much am i willing to bet on these because usually when we make these type of changes these implement these solutions they're not free so by knowing how confident you are with this it not only helps you make the decision that it also helps you when you come back to look at it and see okay i was really confident but i was actually wrong so what was the missing piece that i didn't see before or i'm not very confident i come back and review and i i see it worked why did it work right it helps you create feedback for how you make decisions next time so second order thinking is really helpful for you to see the moving parts and help you start to make decisions and be able to assess what you've done afterwards there's nothing more helpful than seeing blind spots within a complex system which brings me to mental model number six is building a feedback loop this is about designing a system so that you have information and data that helps you understand if you're moving closer to your goal and we've come full circle this is all about non-linear organization instead of saying a then b then c we're trying to talk about right a feeds into b which feeds into c which feeds back into a so we can by improving things we're improving the whole system now in the farm the measurements and the improvements were quite obvious right they were measuring their crop output the progress of it so whenever they see a problem like snail infestation gophers eating the roots they knew exactly what was happening and by improving those they could see progress but in business and in life the measurements might be less clear if your goal is to clarify your thinking what are the best measurements to identify whether you're moving closer to that goal it's a lot more complex so the steps to set up a feedback loop for something less obvious is one to define your goal right you need to know what you want to move towards and this will set the scene for everything else to come number two is articulate the assumptions you have about how you can get to that goal this is crucial because it will help you set up the measurements let's say if you assumed that meditation will help me think clear then the measurements you use are going to be very different if you assume that using mental models will help you get to clarifying your thinking then once you know your assumptions you go to number three which is choose the measurements that work for your assumptions so let's take the example of wanting to clarify your thinking right so first let's look at the goal what are you trying to do with clarifying your thinking let's say it's to make better decisions right then number one your goal is to clarify your thinking in order to make better decisions now let's move on to number two which is identifying the assumptions right say that you think frameworks and mental models are going to help you do that then also you think that okay in order to make better decisions i need to track my decision right okay that's another assumption that we want to put in there with that let's move on to number three which is coming up with the measurements right let's say for the mental models that are going to help you shape your thinking you think that okay i need to have more mental models in my toolbox the more i have the more i'm going to be able to use them together so number one then is you want to track how many mental models you know then you also want to track your decisions right in this case then you can come up with some sort of decision journal that requires you to come back let's say three months later six months later in order for you to assess how well did you make that decision the feedback loop can look something like this one you learn metamodels right and then you keep track of how many mental models you've learned then when you make decisions you want to track the mental models you've used in that decision making process to maybe a decision journey then once you've done that you want to be able to come back and assess how good was your decision making right the mental models you've used were they helpful were they the right ones so let's say you set a timeline for assessing them three months six months when you make the assessment you can then see if the decision was a good one which mental models were helpful if this decision wasn't a good one what was the gap between the mental models i use and the situation and then that will help you learn more mental models and apply them in your life this is actually what i'm doing with my decision making process and how i'm making sure i'm applying the right mental models over time so i'll do another video on decision journals specifically designed to use mental models i've updated since i've created this video here so i'll share with you how you can practically apply mental models in your decision making if you've learned something new in this video make sure to give it a thumbs up subscribe if you haven't already and i will see you in the next video bye