Donors can become so attached to their own vision and strategic plan that they end up trying to bend reality around themselves. Purposefully or not, they encourage those around them to voice only what they already want to hear. This has a terrible impact on their own effectiveness as donors. It can also be deeply dispiriting for their grantees and their staff.
Imagine if, as an investor in financial markets, you had a bedrock belief that the next wave of consumer demand in home furnishings was going to be all about sustainably sourced coconut fiber rugs and textiles. You and your family office investment team build up an elaborate investment thesis that includes positions in all the different layers of that supply chain, from coconut groves to fiber processing plants. Every time your team brings you the latest data showing that nobody actually wants to buy anything made with coconut fiber, you tell them there must be something wrong with their measurements or you insist the breakthrough is just around the corner. Even with really deep pockets, chances are you won’t be able to sustain your coconut fiber bet against the reality of the global commodities market for very long.
In many philanthropic arenas, there is no similar forcing mechanism that requires you to objectively evaluate the evidence and reckon with the world as it actually is. After all, you are trying to change how the world “actually” is with your philanthropy, right? As long as you have money to give away, you can keep right on doing something that is not only out of touch with reality but may even be actively harmful. Take, for example, New York City financier Bernard Selz and his wife Lisa. They have devoted millions of dollars over many years to support the anti-vaccination movement, spreading disinformation in the midst of localized measles outbreaks in New York city and beyond.
This is why it is so important to seek and speak the truth to everyone—including yourself—as you gear up your giving. If you want to uphold this commitment, there are several modes of thinking that will help you get real about how you focus your philanthropy and carry out your giving: systems thinking (and root cause analysis), critical thinking, and design thinking.
Systems Thinking: If the issues that matter most to you are complex, systems thinking equips you with a framework for making sense of the multifaceted mess. It’s about getting all the way down to the root causes of the problems you care about. This is especially important for spotting feedback loops and unintended consequences that can derail your plans despite your best intentions.
Critical Thinking: Speaking of messy reality, there’s a whole lot of sloppy thinking in the world of philanthropy. Critical thinking is a key antidote. If you’re going to be the one making consequential decisions about how to allocate your philanthropic resources, the quality of your reasoning process really matters! This includes your ability to overcome (or at least identify) your own blind spots and cognitive biases. This is especially important when grappling with issues of race, power, and identity. Having the discipline to step up your game as a critical thinker is a great way to step up your effectiveness as a philanthropist.
Design Thinking: Finally, ensuring that the people closest to the problem have a full voice in developing the solutions is one of the foundations of meaningful giving. This requires design thinking. For example, if your goal is to save honeybees from hive die-offs in California’s almond country, you’d spend a lot of time talking with commercial beekeepers and the farmers who depend on them—you wouldn’t just hire a newly minted Ph.D. with an intriguing theory and let them have at it.
We'll look more deeply each of these tools in this series of posts, beginning here with systems thinking.
The term “systems thinking” was coined by Barry Richmond of MIT in the late 1980s. It was made popular a few years later by Peter Senge in his best-selling business management book The Fifth Discipline. Systems thinking focuses on breaking down systems into three elements. These are the components of the system, the interconnections between the components in the system, and the outcomes reliably produced by the system. In other words, the system’s real, functional results, regardless of whatever its stated purpose is supposed to be.
Systems thinking is often represented by causal loop diagrams. These graphics provide a visual representation of how the components of a system are interconnected and how feedback loops influence the performance of a system over time. Here’s an advanced example of systems thinking applied to the interactions of fishing and other human activity with global fishery stocks.
Reproduced with permission from Joe Hsueh, Academy for Systemic Change
If you are trained to build and read these kinds of diagrams, there’s a powerful and counterintuitive story here about how to manage fisheries as a common resource. Unfortunately for many of us the symbolic notation and fine print of formal systems mapping is hard to follow. But never fear—systems thinking isn’t just a tool for specialists. In the next post in this series we’ll walk through a technique called Root Cause Analysis, a simple and straightforward way of using systems thinking as you gear up your giving.
One of the fundamental ideas behind systems thinking is that the underlying structure of a system is often hiding in plain sight. In other words, we can figure out the underlying structure because it drives the behavior of the system. This comes in the form of events we can observe, playing out over time. As Donella Meadows puts it in her excellent book, Systems Thinking: A Primer, “System structure is the source of system behavior. System behavior reveals itself as a series of events over time.” She goes on to explain that because language occurs in a linear fashion, words aren’t always ideal descriptors. Unlike forming a linear, logical sentence, systems happen all at once, and they are connected in many ways. This is also why it can be useful to reference visuals that allow us to “see” the system components and their interconnections. Visual representations enable us to conceive of the system as a whole, empowering us to develop a better understanding of why it ends up producing the outcomes that it does. This is something that even a completely thorough, sequential narrative cataloging every system component and interconnection doesn’t allow us to do. The mapping approach also lets us see the construction of the larger system. It may be made up of different subsystems, sometimes with competing aims. This is very important when we are looking for deeper insight into how a system’s underlying structure drives outcomes in the form of visible behavior and events.
Looking at the whole picture can be particularly important when a system’s actual outcomes are consistently different from its stated aims or intended purpose. For example, employers with a policy of not hiring convicted felons are presumably seeking to make their own places of employment safer. State policymakers enacting “three strikes and you’re out” felony laws, mandating lifetime imprisonment without parole, are supposedly also seeking to protect public safety. But taken together, these policies can create circumstances in which someone with two criminal convictions and few prospects for gainful employment has the path back to prison already paved for them—a terrible outcome for them, as well as any victims of their third offense.
Systems thinking is challenging because we are wired to look at the world in simpler terms. Linear, event-focused, cause-and-effect thinking is our go-to mental strategy for making sense of the world around us. Clearly, the linear approach has served humanity well over many thousands of years. The thing is, straightforward rules of cause-and-effect work just fine until they don’t. As our societies have become increasingly complex and interconnected, we need to develop new tools to understand the deeper structures that drive events. Systems thinking helps us understand how our own actions play out over time across the complex social, economic, and political systems we have created. For instance, Newton’s three laws of motion are straightforward and useful, but Newtonian physics simply cannot account for, calculate, or assess some of the latest, complex revelations about the universe. Quantum physics offers a much better view and enables us to keep moving, advancing, and succeeding in this area. Just as we still use Newton’s laws to calculate satellite launch trajectories, we are now looking to and learning about quantum physics to help us sort out the dynamics governing the complex relationships among subatomic particles.
Here are five circumstances to watch for:
It’s worth remembering that complex systems can be at play in seemingly mundane areas of daily life, like whether our favorite brand of beer is going to be in stock at the local store. Harvard Business School has a case study called “The Beer Game” that is famous among supply chain geeks. This case shows just how counterintuitive and unpredictable systems dynamics can be in a simple supply chain. In the example, a package store owner and a brewery sales manager are the only players. Due to delays between placing orders to the brewery for more beer and actually receiving it at the package store, it is remarkably hard for players to maintain a stable equilibrium between supply and demand. This simulated game frequently results in wild swings between drastic shortages and massive oversupplies of beer following even small changes in consumer demand week to week. The more interconnected and complex our world becomes, the more it becomes full of systems whose behavior defies our instincts for straightforward, linear, cause-and-effect relationships. That’s a lot more going on behind the scenes than most of us are thinking about when we reach for a cold one. It can be much the same thing when donors say, “There’s clearly a shortage of X in the community! Let’s order up some more…”
By helping to illuminate deeper systems at play, unexpected feedback loops, and other counterintuitive dynamics, systems thinking helps us gain clarity as change agents. This is not a matter of subscribing to ideologically driven articles of faith, but rather of pragmatic reflection on how the systems around us actually function, whatever their stated purpose. For instance, as a donor hoping to drive systems change, it is especially important to consider the following:
Stay tuned for the next post in this series where we'll look at Root Cause Analysis, a simple alternative to causal loop diagramming that is a practical way to actually apply systems thinking to get to the bottom of the real world challenges you are grappling with in your giving.
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