What is systems innovation?

This article was first published on Apolitical. You can read the original article here.

The word ‘system’ is thrown around a lot today. Ecosystem, political system, systems interventions, systems innovation, systems change. But what is a ‘system’? According to scientist Donella Meadows, a system is a set of parts that is coherently organised and interconnected in a structure that produces a characteristic set of behaviours and achieves a common goal or goals. It can be physical, such as a machine or an ecosystem, or it can be abstract, such as a financial or organisational system.

What this means is that the decisions and actions each of us take as individuals, corporations, governments and other groups or members of society combine and interact to create larger systems. And if we all make up the system, then changing the system is about shifting the underlying values and norms that shape people, our organisations and the relationships we hold.

Why do we need systems change?

Many of the biggest challenges the world faces – the climate crisis, food insecurity, energy crisis, and growing inequalities – are difficult to overcome because they are the results of complex systems interacting with one another. The only way to implement impactful, long-lasting change in these systems is to start with a holistic view of issues. And that means first, understanding how various parts of the system relate to each other. Once we understand how the current system operates and interacts (what brought us to the climate crisis for instance), we can start to make changes across the interactions, and experiment with new ways of living, learning along the way.

“Lasting change can only be achieved by understanding and changing the underlying structure and relationships of the system, rather than making tweaks to its components.”

This system thinking contrasts with mainstream approaches to tackling our biggest problems which prioritise siloed, shorter-term interventions. Typically, they do not consider how some changes might affect other parts of the system. These quick fixes might make everything better for a moment in a particular place, but over time, or for some parts of the population, or in some parts of the world, the situation worsens. Lasting change can only be achieved by understanding and changing the underlying structure and relationships of the system, rather than making tweaks to its components.

What does systems innovation mean in practice?

Let us look at a concrete example: tackling pollution in cities. A mayor can decide to prohibit all vehicles that emit more than a certain amount of CO2 from entering the city centre. While this measure may initially – and quite rapidly – decrease pollution, it fails to consider the potential impact on those who cannot afford to purchase newer, less polluting vehicles or those who live outside the city centre and rely on scarce public transportation to get to work or school. Nor does it tackle the issues of traffic or a city’s lack of green and social areas. The list goes on.

When decision-makers start thinking about cities as complex systems of systems where transportation, retail, health, welfare, finance, water, politics, waste, pollution, art and people interact and impact one another, it completely changes how the issue is approached. Once they have mapped how these systems interact to achieve their goal (here, decreasing pollution), they can identify areas that would benefit from innovation.

We understand innovation in a broad sense, and these interventions could include anything from innovative green products to alternative services, recent technologies, upgraded policies, education programmes, or novel financial instruments. In a systems innovation approach, solutions become a set of integrated and coordinated interventions (a portfolio) in economic, political and social systems, supporting different but connected initiatives. And they become experiments from which to learn and build, accelerating knowledge on those that have the potential to be scaled.

To create these portfolios, you need to engage and collaborate with representatives from all aspects of life: from policy to finance, education, research, business or art; people who do not normally interact with one another. It requires embracing and negotiating through the sometimes-conflicting goals held by those groups. But in the end, tackling tensions around ownership, diversity and justice head-on allows the crux of the problems to be addressed, bringing everyone with you in the process.

Building the skills for systems innovation

While more people working across various issues acknowledge the need for systems innovation, there are still a lot of barriers that prevent the world from embarking on this journey. For example, we still have limited knowledge and understanding of how to develop effective systemic impact and how to intervene in complex contexts, especially among decision-makers.

Engaging in systems change almost always means jumping into the unknown because interventions are not easy to predict. So, it requires a mindset shift to value experimentation and continuous learning to allow unexpected results to emerge and flourish.

The good news is that a lot of organisations are now helping decision-makers to develop the capabilities and mindsets to work in complexity and uncertainty. This includes skills to collaborate effectively with multiple diverse actors in complex contexts; managing risk and failure; inclusive leadership styles that harness the benefits of diverse perspectives; and leveraging relevant tools, approaches or actions to amplify positive change in complex contexts.

This, for us, is the only way to bring deep change and solutions to our most pressing challenges, from the climate crises to food security, poverty, energy crisis, gender inequality, healthcare, etc. These are all interconnected issues, and we believe that systems change through systems innovation is the only way to build the thriving, just, climate-resilient future we all aspire to.

EIT Climate-KIC’s response to the climate emergency has been to focus our efforts on systems innovation, to generate options and pathways for radical transformations in whole countries, cities, regions, industries and value chains. Read more about EIT Climate-KIC large-scale Deep Demonstration projects implemented through which we offer our ‘systems innovation as a service’ model to Europe’s most ambitious challenge owners.