Systems thinking is a holistic discipline, seeking to understand linkages between actors in a system. The various systems thinking techniques approach problems in a different way, but have in common a sense that the answer will not be found in a single static equation. Instead it might be a series of insights as to the stability of systems under different interventions by the actors in them.
Systems thinking is particularly important to actuaries because there are a number of important behaviours which emerge from the collective actions of agents in the financial system that cannot be understood without a wider view of linkages between those agents.
The Resource and Environment Board wants actuaries to take the lead in adopting systems thinking approaches, becoming professional advisers with greater awareness of the systemic impacts of their work, and of the impact of system dynamics on their clients and employers.
On 30 September 2016 the IFoA Sustainability Research & CPD Committee hosted a Systems Thinking Workshop to explore the importance of systems thinking and how to incorporate it more widely in actuarial practice. Following on from the success of the workshop, the Systems Thinking Incubator was established.
The Systems Thinking Incubator has a role influence the wider IFoA to develop and incorporate thinking around systems as well has helping to develop and promote the approach itself.
Systems Thinking Presentations:
- Complexity Simplifying Risk, Neil Cantle, Sept 2016
- Overview of Systems Thinking: what it is, its development in the history of science and why it is important, Aled Jones, Sept 2016
- The potential for agent based modelling to be helpful for investment or other issues relevant to actuaries, Andrew Slater, Sept 2016
- System Dynamics and Economic Modelling, Devrim Yilmaz, Sept 2016
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