Statistical Thinking Tools for System Dynamics

Statistical thinking is a well-established approach that involves the application of the scientific method to solving real-world organizational problems. The premise behind statistical thinking is that a disciplined approach to gathering facts can be used to identify the root causes that act as a barrier to successful performance. Once these root causes are identified, corrective action can be planned, and implemented, in order to change the underlying system. At a practical level, the Six Sigma methodology is the most widely known statistical thinking approach. Its structure involves a multi-stage methodology that starts at problem definition, and ends at implementation and consolidation of change. Throughout the stages of Six Sigma a number of practical tools – both qualitative and quantitative – are used to help formulate the problem, create a shared understanding of the problem amongst the different stakeholders, and identify policy levers that can improve system performance. This paper highlights the main parallels and differences between statistical and systems thinking, and illustrates how a number of tools from statistical thinking can also be used throughout a systems thinking consulting intervention. The paper concludes with a case study.