Example of how we have been trained to ignore feedback loops of systems we deal in and deal with

A Systems Thinker will tell you that one of the many starkest differences between Systems Thinking and Analytical Thinking is the ability to perceive feedback loops. When an scientifically minded technologists reads an article about feedback loops and says, "Got it. Makes sense. We've learned it."

But is merely knowing that feedback loops exist the same as learning? The true learning is ability to detect feedback loops in real world systems in which we deal in and deal with - because once we can do that, we design systems differently, operate them differently, and intervene in them differently.

I could give countless examples of well-intentioned, scientifically minded technologists who talk about feedback loops but fail to detect them in practice. Why? Because they have been methodically trained to ignore them. You see it in their conversations, their LinkedIn posts, their root cause analyses—everywhere they operate with a rigid, linear, cause-and-effect mindset, devoid of feedback loops.

Let's put this to the test with a simple exercise. Our real world are way complex than the example.

The Investment Offer

You have an investment opportunity. The deal is simple:

• You invest $100.
• Every month, we flip a coin.
• If you guess correctly, you gain 50%, and your investment grows to $150.
• If you guess wrong, you lose 40%, and your investment drops to $60.
• The process repeats for newer amount for 5 years meaning 60 coin flips
• If your balance ever falls below $5, you're out.

Would you take this deal?

Most people, trained in probability and risk analysis, will instinctively think:

• 50% chance to win → Expected gain: $50
• 50% chance to lose → Expected loss: $40
• Net expected gain: $10 per round

The numbers look favorable, and the law of large numbers suggests you'll come out ahead in the long run. This is the way we all have been taught to think. I have studied statistics for years, this is the way probability and expectations are taught. But this thinking is dead wrong. Most people in this game will lose money. Lose mean lose crazy amount of money many or even most will be out of the game. Why ? For a simple reason, there is a feedback loop that you are failing to see.

For people who are celebrating, that I had decided not to take the deal, but a good outcome mean nothing unless you have a good explanation because a bad explanation may get to short term lucky decision and will kill you in long term. So whatever explanation you have for which you did not invest, lets put that explanation to test. Here is the new deal for those who did not decide to take first deal

Put 100$ to enter the deal. Every month for 5 years, 60 months

• If heads, you gain $50, take $50 out and keep $100 for next month
• If tails, you lose $40, but you can reinvest $40 of your own money to to make it $100 and stay in game or loose all.

Would you take this second offer? You better take this offer, because it's a good one. If you do take this offer, is the explanation for first first deal still hold true. If not you still does not understand why option #1 is bad option.

So what's the difference between two options? The first offer contains a hidden feedback loop— or a visible feedback loop that most analytically trained minds does not know how to see. They analyze parts, break systems into discrete steps, and miss the reinforcing effects that drive systems toward collapse.

In the second version, the feedback loop of option #1 does not exist, so your expected gain $10 per round holds true.

Now that I have told you that there is a feedback loop in #1, you might try to see it more intentionally. Some may find it and would say ah!! that makes sense. But what if this offer was not to challenge your understanding, meaning you had no idea that Manish is putting me into some trap, so you won't thinking this very hard. At times many making decision opposite of what I am proposing, because they know I am trapping them . But if you do that, you are just playing game theory blindly. In real life an investor would have taken your for ride and they do all the time.

But I am not an investment advisor. I am a Systems Theacher[not a typo], creating conditions for people to think. There are feedback loops all around you. If you struggle to see feedback loop in above question, think how many feedback loops you are ignoring in your organizations. So you know we make the case that why DevOps, Agile, Lean all fails in software world because feedback loops are base principle of those framework which no one teach us how to observe them. If interesting in learning systems thinking and how to observe feedback loops join[just not visit] our community and WhatsApp Group and we will update you when next set of courses become available for you to join.

Now tha that you know #1 is bad offer, think of explanation of why it's a bad offer and easy to come up with explanation when you know the answer. Without answer your brain would have most probably pick up #1 as good option, but it has to do with how we have been taught to ignore feedback loop in scientific, engineering and technological trainings. If you truly believe in learning systems, we suggest you stop building on top of what you already know but question limitation of analytical thinking and learn Systems Thinking,