Systems Thinking

Systems Thinking:

Perhaps the most successful learning technique we are taught as we are growing up is the method of analysis by decomposition, in which we break complex things down to the level where we can understand the individual parts. This works for many things, but for dynamic systems, particularly those that involve humans, the usual effect is to squeeze out some of the most important features.

Systems Thinking is an approach that draws attention to connections among the parts, particularly focusing on how the elements of a system feed back to one another, both creating extroadinary patterns of growth (amplifying feedback) and providing ways to control the system (regulating feedback).


A System of Systems

Hat tip ~ IBM social media

Systemic Risk
The Dynamics of Modern Financial Systems, Prasanna Gai

Systemic Risk opens new ground in the study of financial crises. It treats the financial system as a complex adaptive system and shows how lessons from network disciplines-such as ecology, epidemiology, and statistical mechanics-shed light on our understanding of financial stability. Using tools from network theory and economics, it suggests that financial systems are robust-yet-fragile, with knife-edge properties that are greatly exacerbated by the hoarding of funds and the fire sale of assets by banks.