How Managers Can Deal with Complex Issues: A Semi-Quantitative Analysis Method of Causal Loop Diagrams Based on Matrices

UZH Business Working Paper No. 323

33 Pages Posted: 6 Mar 2015 Last revised: 21 Mar 2015

See all articles by Mathias Beck

Mathias Beck

ETH Zurich

Lukas Klaus Schoenenberger

Duke-NUS Graduate Medical School Singapore; University of Zurich - Department of Business Administration (IBW)

Andrea Schenker-Wicki

University of Basel

Date Written: November 1, 2012

Abstract

The increasing complexity of the modern world creates both higher risks and new interdependencies in the socioeconomic environment. To cope with these challenges powerful new tools must be applied to find sustainable solutions. System dynamics is a field that offers potential assistance in dealing with complex issues. However, managers and politicians often lack the knowledge and necessary skills to apply quantitative methods in their decision-making process. In contrast, qualitative approaches are easily understood and handled but have limited capacities for analysis. To address this gap, we have developed a bundle of tools tailored for managers and politicians facing complex problems. These tools enable executives to recognize effective levers and assess potential consequences of specific interventions in a highly interconnected system. The approach detailed here equips decision makers with a powerful method to develop, test, and communicate strategies to find long-term sustainable solutions for complex issues in business and society.

Keywords: Causal loop diagram, semi-quantitative approach, adjacency matrix, feedback, mental model, strategic decision making

Suggested Citation

Beck, Mathias and Schoenenberger, Lukas Klaus and Schenker-Wicki, Andrea, How Managers Can Deal with Complex Issues: A Semi-Quantitative Analysis Method of Causal Loop Diagrams Based on Matrices (November 1, 2012). UZH Business Working Paper No. 323, Available at SSRN: https://ssrn.com/abstract=2573718 or http://dx.doi.org/10.2139/ssrn.2573718

Mathias Beck

ETH Zurich ( email )

Rämistrasse 101
ZUE F7
Zürich, 8092
Switzerland
+41 44 632 29 46 (Phone)

HOME PAGE: http://kof.ethz.ch

Lukas Klaus Schoenenberger (Contact Author)

Duke-NUS Graduate Medical School Singapore ( email )

8 College Road
Singapore, 169857
Singapore

HOME PAGE: http://hssr.duke-nus.edu.sg/

University of Zurich - Department of Business Administration (IBW) ( email )

Hottingerstrasse 10
Plattenstrasse 14
Zurich, 8032
Switzerland

Andrea Schenker-Wicki

University of Basel ( email )

Petersplatz 1
Basel, CH-4003
Switzerland

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