Causal loop diagramming is a technique derived from the discipline of System Dynamics (SD), which was developed by Jay Forrester at MIT. In the 1990s, SD was popularised by Peter Senge in his two books The Fifth Discipline and The Fifth Discipline Fieldbook. Causal loop diagrams, also known as CLDs, are a powerful method for identifying the dynamics of causation in organizations, as well as social and engineering systems.
There are a number of important principles in using CLDs:
- They are developed with the client and represent the client’s view of the dynamics of a problem in their organization. The process of developing the CLD may change the client’s views and develop a clearer understanding of the dynamics of the problem and the possible consequences of interventions.
- CLDs are problem-oriented and should capture all the dynamics of a problem within the client’s organisation.
- The CLD must present to both the client and the consultant a plausible and logical “story” or narrative of the problem.
- The CLD, when complete, presents a complete explanation of the dynamics of the system. There should be no exogenous, or unmanageable, variables in the diagram.
- The system’s behaviour varies over time as a result of its internal dynamics
- System components have non-linear behaviour
- The CLD should provide a complete explanation of the behaviour being considered. The general rule here is that most organizations create their own internal dynamics in response to the external environment in response to the external environment. These are often not understood and often problematic, WIth a good CLD, it is possible for managers to examine and rectify these internal dynamics to solve many of the problems they face.