What do we want from Systems Thinking?
summary
Engineered systems thinking treats product development as an intentional system optimized for shareholder economics using lifecycle profit sensitivity instead of slogans. Tools: sensitivity analysis and cost‑of‑delay (example: a 1‑month delay worth ~$500k vs 1% unit‑cost ≈ $150k), queuing math showing 98% utilization creates long invisible queues, economic U‑curves for capacity and batch size, and asymmetric payoff design (lottery example raising EV to $1.89) implemented as a practical rule—the $300 per pound rule that lets 5,000 engineers cut weight—and buy information in small batches to enable fast shutoff or scale up.
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chapters (19)
- 0:00Intro
- 2:11Today's Topics
- 3:51What Is System Thinking?
- 7:29Attributes of Systems
- 13:37Making Economic Decisions
- 15:34The Modeling Process
- 15:46The Model Output
- 19:02Any Analysis Beats Intuition
- 20:00Decentralizing Control with Decision Rules
- 23:37Managing Tradeoffs
- 25:23The Effect of Capacity Utilization
- 26:28Managing Queues
- 28:06Drawing Review Process Small Batches
- 28:46Setting Batch Size
- 31:41Exploiting Uncertainty
- 32:29Asymmetric Payoffs and Option Pricing
- 38:04Creating Feedback
- 38:28The Front Loaded Lottery
- 44:196. Some Final Tips
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