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 / Fall 2005 / Issue 40(originally published by Booz & Company)


The Prophet of Unintended Consequences

Jay Forrester’s computer models show the nonlinear roots of calamity and reveal the leverage that can help us avoid it.

Photographs by Steve Edson
A visitor traveling from Boston to Jay Forrester’s home in the Concord woods must drive by Walden Pond, where the most influential iconoclast of American literature spent an insightful couple of years. Jay Forrester, the Germeshausen Professor Emeritus of Management at the Massachusetts Institute of Technology’s Sloan School of Management, also has a reputation as an influential and controversial iconoclast, at least in management and public policy circles. But whereas Henry David Thoreau famously urged humankind to live a life of simplicity, Jay Forrester has spent the past 40 years trying to help people live more effectively amid complexity.

Professor Forrester, who turned 87 this year, is the father of a field of research and analysis called system dynamics — a methodology that uses computer-based models to simulate and study the interplay of growth and equilibrium over time. Absorbing the implications of these models in ways that Professor Forrester prescribes can allow mere mortals to comprehend the obscure nature of (and counterintuitive solutions to) such knotty problems as environmental damage, the boom-and-bust pattern of economic cycles, supply chain malfunctions, and the pernicious side effects of well-intended policies everywhere.

These problems, says Professor Forrester, are all manifestations of the underlying nature of complex systems, from living cells to organisms to organizations and corporations to nations to the world at large. For example, there is generally a principle at work called compensating feedback: When someone tries to change one part of a system, it pushes back in uncanny ways, first subtly and then ferociously, to maintain its own implicit goals. Dieters know this well; a person’s body will seek to maintain its current weight, producing cravings for fattening food. Similarly, a corporate reorganization, however well designed, tends to provoke resistance as employees circumvent the new hierarchy to hang on to their old ways. To Professor Forrester, these kinds of discomfiting phenomena are innate qualities of systems, and they routinely occur when people try to instill beneficial change. If you’re attempting to shift a complex system, such as a company, and you haven’t become aware of resistance or other unintended consequences, then the problems are probably building under the surface and simply haven’t burst forth yet.

Professor Forrester’s understanding of complex systems derives in part from years designing servomechanisms — the automatic control devices that inspired the field of cybernetics in the mid-20th century — for the U.S. Navy. In his pioneering computer simulations, Professor Forrester modeled the slow-to-emerge “tipping points” (as writer Malcolm Gladwell would later call them) that make systems difficult to manage, yet can also provide hidden leverage points for effective intervention. Modeling this kind of growth and resistance requires nonlinear calculus — a form of math so intricate that even the most gifted and highly trained mathematicians are incapable of solving nonlinear equations in their heads.

Thus one of the most controversial aspects of Professor Forrester’s work is also his core premise. He argues that most social organizations, from corporations to cities, represent a far higher level of complexity and abstraction than most people can grasp on their own. And yet corporate and government leaders of all sorts persist in making decisions based on their own “mental models” — Professor Forrester’s term for the instinctive theories that most people have about the way the world works. These decisions, no matter how well intentioned or intuitively comforting, are decidedly inferior, he says, to policies and strategies based on computer models of “system dynamics” — the interplay of complex, interrelated forces over time. As a result, Professor Forrester argues, most of the pressing problems facing humanity today will elude solution until a new generation, familiar with computer models, enters leadership roles.

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  1. Mark Buchanan, “Supermodels to the Rescue,” s+b, Spring 2005: An overview of the current state of computer modeling in business. Click here.
  2. Diana Fisher, Modeling Dynamic Systems: Lessons for a First Course (Isee Systems, 2005): Introduction for educators using models in the classroom.
  3. Lawrence M. Fisher, “The Paradox of Charles Handy,” s+b, Fall 2003: Jay Forrester’s article “A New Corporate Design” anticipated the ideas of visionary creative mind Charles Handy… Click here.
  4. Andrea Gabor, “Post-capitalism’s Drop-out Prophet,” s+b, Fall 2004: …and controversial post-Harvard creative mind Shoshana Zuboff. Click here.
  5. Jay Forrester, Collected Papers of Jay W. Forrester (Pegasus Communications, 1975): Jay Forrester’s most critical papers, including “A New Corporate Design” and a summary of his industrial research.
  6. Jay Forrester, Industrial Dynamics (1961), Urban Dynamics (1969), World Dynamics (1971), all from Pegasus Press: The great Forrester trilogy, still full of surprises and insights after more than 30 years.
  7. Donella H. Meadows, Jørgen Randers, and Dennis L. Meadows, Limits to Growth: The 30-Year Update (Chelsea Green, 2004): The most current overview of global potential for overshoot and collapse.
  8. Keith Oliver, Dermot Shorten, and Harriet Engel, “Supply Chain Strategy: Back to Basics,” s+b, Fall 2004, The management of complex supply chain systems. Click here.
  9. Peter Senge, The Fifth Discipline (Doubleday, 1990): Business-savvy bestseller that introduces key systems thinking concepts and practice.
  10. Peter Senge et al., Schools That Learn (Doubleday, 2000): Application of system dynamics and other “learning organization” ideas to education, with an essay by Jay Forrester.
  11. John Sterman, Business Dynamics: Systems Thinking and Modeling for a Complex World (Irwin/McGraw-Hill, 2000): The most accessible and up-to-date guide to system dynamics for business planning and development.
  12. MIT System Dynamics in Education Project: The project is designed to help educators prepare tomorrow’s complex thinkers. Click here.
  13. System Dynamics Web site: The System Dynamics Society home page, a starting point for resources and conferences. Click here.
  14. Ventana Systems Web site, Click here, and Isee Systems Web site, Click here.: Access to software for modeling systems.
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