‘A systems thinker sees feedback loops everywhere, either balancing or reinforcing.’
My aim is to help you see these loops around you, in things you look at, think about and even in things you read. In the last article, I talked about how integrating systems thinking within strategy can help foresee and minimise the unintended consequences of interventions. In this article, I talk about a real-life application of this tool, which might help you create a habit of identifying feedback loops in things around you.
For an example, let us take the circumstances that led to the death of thousands of farmers in India in the first decade of this century. Let’s watch this video first.
With the hope of feeding millions of hungry people in India, aid agencies and the government of India allowed Monsanto to create a monopoly. The company assured farmers that by using genetically modified (GM) crops, their productivity would be much higher than normal. However, Monsanto captured the whole input market for agricultural products and farmers were unable to afford them.
This affected the Indian agricultural market in two ways: farmers were obliged to buy, or enticed to buy the expensive agricultural inputs from Monsanto via taking loans; and, due to the massive production of agricultural goods, the market price for those goods was significantly lower. So, it was a tragedy of higher input costs and lower market prices for the final produce. Many farmers fell into an endless cycle of debt, depression, hopelessness and despair and they felt they had no choice but to end their lives.
So, when the government and donor agencies wanted to increase agricultural production to feed millions of hungry people, they visualised or created a loop (see Figure 1).
As their people were starving, they decided to introduce GM crops to boost production. They assumed, the more GM crops, the greater the food production. Therefore, introduction of GM crops and food production had a positive relationship with food production. Finally, the more food production meant less starvation. The final two variables are negatively correlated. This is a ‘quick fix’. They created a balancing loop to solve the problem of starvation by introducing GM crops through only one supplying agency.
But the reality was not that simple and rather than creating a balancing loop, the authority created a reinforcing loop which caused the suicides of many farmers.
The introduction of GM crops through only one supplying company, created a monopoly. Agricultural input costs increased, which resulted in millions of farmers indebted. At the same time, massive food production increased supply to the market and, naturally, the price of agricultural produce went down. So, on one hand, farmers became indebted while buying the costly inputs for their production, and on the other hand, they did not get sufficient prices for their output to repay their loans. It created both economic and psychological shock for the farmers. Unable to repay their loans, thousands of farmers committed suicide, and the starvation that prompted the policy was not addressed.
The next article will extend this case and delineate how the government and aid agencies could have applied systems thinking while adopting GM crops, and how they could have created a balancing loop so that the unintended consequences could have been addressed and thousands of lives saved.
M Mizanur Rahman is the International Programs and Policy Manager for LG Professionals Australia and a PhD candidate at Australian National University. If you are interested in ‘Systems Thinking’, please keep an eye on this page or write to Mizan at firstname.lastname@example.org