Systems Thinking Shapes Thinking Systems: Adaptive Leadership and Cross-sector Collaboration

Australia’s 2050 treasury report indicates that the biggest challenges facing Australia are escalating pressures on the healthcare system, challenges to economic growth and standards of living. Contributing factors include Australia’s sizable aging population and an inadequate number of currently sustainable solutions that will support future economic growth and productivity. KPMG released a similar report- the Top Issues Facing Business Leaders in Australia, their report indicates that over the next 2-5 years, technology, digital transformation, and cyber security will be notable challenges for businesses, as will regulatory and reporting processes. Their article also indicates that Australia will grapple with a combination of challenges including globalised challenges including geopolitical disruptions; climate change-driven economic opportunities; a future skills gap; the social impacts of disruptive technologies; and housing affordability. It is apparent that the multi-sector entanglement of these dynamic challenges will require novel approaches to find adequate solutions.

Systems thinking

Systems thinking involves understanding organisations as part of larger interconnected systems, where small changes to one part impacts the whole. Comparable to a flock of a birds, where one bird’s sudden movement affects the collective behaviour patterns of the flock. The murmuration of birds is a phenomenon that has long fascinated people, how one seemingly random bird at the end of a flock can trigger random responses at the other end. This decentralised view when applied to how people, processes, and external factors are interconnected and interactive, forms some of the foundations of systems thinking.

This outlook emphasises the power of signals, feedback and interdependencies between people and organisations (even those that are yet unknown and not measurable). Systems thinking goes beyond the obvious problems and available data and recognises that emerging patterns are the ‘tricky algorithms’ to start looking for.

Systems thinking, as a philosophy of acquiring and creating knowledge from organisations or systems, can be applied to data analytics and human behaviours. Human behaviours in organisations includes social, organisational, and psychological actions that influence the larger system and vice versa. Thus, emphasising the connectivity between teams, organisations, and industries, and the mutual influence giving rise to new patterns of behaviour. Unsurprisingly, systems thinking also supports the need for a specific leadership approach that views the organisation or industry sectors as an operative assembly of dynamic parts. Assuming an uncertain and flexible environment that is responsive to signals triggering internal and external changes.

Adaptive leadership

Adaptive leadership is particularly critical when provoking cross-sector collaboration, including the healthcare, technology, government, and business sectors, as it addresses the uncertainties and dynamic environments in which each operates. Integrating adaptive leadership with current industry-specific strategies enables organisations to become agile and responsive, thus better able to navigate the complexities of today's and the future's challenges.

Adaptive approaches focus on responding to change and being able to thrive amidst uncertainty. It encourages the engagement of multiple stakeholders simultaneously in problem-solving. Collaborative approaches empower teams to experiment outside their areas of comfort and forge innovation. This decentralised view of problem-solving is essential when organisations need to solve complex problems with multi-industry partners, lacking any clear solutions.

In cross-sector applications, adaptive leadership also shines in collaborations between government and the private sector, where leaders face new challenges such as digital transformation and shifting market demands. For example, a government agency tasked with addressing a public health crises must quickly adapt policies and procedures to emerging data and circumstances. The private technology sector has the capability to support this requirement by developing flexible strategies that can evolve as new information becomes available. In the tech industry, adaptable leadership is crucial for navigating innovation and disruption. Whereas healthcare leaders must be responsive to public health needs, policy demands, and workforce dynamics.

Cross-Sector Relevance

Across sectors, effective responses to future challenges requires a blend of leadership approaches. Where, institutional leadership provides the stability needed for organisations to function. Adaptive leadership and systems thinking enables responsive thinking to dynamic challenges and uncertainty. Systems thinking fosters innovation in environments where change and unpredictability are constant but certain solutions to Australia's formidable challenges are not.

References:

Uhl-Bien, M., Marion, R., & McKelvey, B. (2007). Complexity Leadership Theory.

Obolensky, N. (2010). Complex Adaptive Leadership: Embracing Paradox and Uncertainty.