A reinforcing loop is one type of causal loop, a term used to describe one way a number of variables can be connected. In a reinforcing loop specifically, one variable reinforces another, which in turn reinforces yet another. When the value of one variable goes up, the corresponding variable affected also goes up. And if one goes down, the other goes down also.
The Core Theory Of Success As A Reinforcing Loop
Dr. Daniel Kim’s Core Theory of Success is a good example of a systems causal loop that explains how the quality of interactions within a team or organization drives overall performance. It operates as a reinforcing loop, where each element strengthens the others in a continuous cycle. The core elements of this loop are:
• Quality Of Relationships: Positive, trusting relationships within the team create a foundation for open communication, collaboration and mutual respect. High-quality relationships foster psychological safety, allowing team members to share ideas freely and work together effectively.
• Quality Of Thinking: When relationships are strong, team members engage in deeper, more creative thinking. They are more likely to challenge assumptions, explore innovative solutions and make informed decisions. The collaborative environment enhances the team’s ability to think critically and strategically.
• Quality Of Action: High-quality thinking translates into effective action. Teams that think well together are able to plan and execute strategies with precision, leading to coordinated and impactful efforts. This leads to smoother execution of tasks and more aligned actions toward shared goals.
• Quality Of Results: Quality actions naturally lead to high-quality results. These results may be seen in terms of improved performance, better outcomes, successful project completion or reaching organizational goals. Positive results reinforce the belief in the team’s abilities and approach.
As the team sees positive results over time, team members become more motivated and committed. Success strengthens their relationships even further, creating a virtuous cycle. This motivation drives continuous improvement, pushing the team toward becoming a high-performing unit. Thus, this theory operates as a reinforcing loop because each element strengthens the others. When teams achieve positive results, it enhances their confidence and further improves the quality of relationships, leading to even better quality of thinking. In turn, this drives higher quality of action and, consequently, superior quality of results. This self-reinforcing cycle helps teams grow into high-performing, cohesive units over time.
Causal Loops In The Real World
In a real-world operating context, a company may desire to showcase itself as being highly innovative. They then decide to bring to market a new project that would differentiate itself by integrating many leading technologies and approaches. When the level of integration is high, the complexity of the project goes up. This results in the number of parameters required increasing exponentially. That brings about potential lapses and errors, which would drive down the quality of the results. The project then gets stripped down to bring down the integration complexity. Such a scenario can utilize a balancing loop to convey the risk involved.
The HR team in a company I worked with noticed burnout and low energy, even among their high-performing employees. What was happening? What could HR do to improve the situation?
Using a causal loop diagram, the diagnosis might be that what impacts performance is the effort required, which is largely tied to motivation. High performance begets recognition, which in turn motivates the individual. As such, a reinforcing loop can be drawn up such that recognition results in motivation, driving effort toward performance, which in turn increases recognition.
In this particular company, project teams were formed by peer selection, and those who had been officially recognized were often sought after for their expertise. In this scenario, a reinforcing loop existed where recognition boosted motivation, leading to higher effort and performance, which then led to more recognition. However, the unintended consequence was that high-performing employees became burdened with additional work through these peer-selected project teams and experienced exhaustion, anxiety and distress.
Ironically, therefore, the same motivation that increased enthusiasm also resulted in greater burden and ultimately burnout (low energy resulting in low performance). Hence, it is very important that when HR formulates new policies such as staff recognition awards, they take into consideration the different causal loops at play, so that the intervention does not inevitably create unintended consequences in the longer term.
Turning back to the Core Theory of Success, if management deems the performance of the team inadequate, they may be tempted to intervene by exerting pressure. This pressure to improve results means increased top-down efforts, which can yield short-term improvements. However, continuous pressure can create excessive tension and distress, negatively affecting the quality of relationships, which ultimately decreases the quality of thinking and hampers the quality of results over time. Weakened collaboration and team cohesion might even create a negative vicious cycle, worsening performance over time.
While pressure may offer temporary gains, true and sustainable improvement requires a different approach. Focusing on core values and strengthening relationships through authentic conversations should accompany any pressure intervention to ensure employees feel cared for and heard in difficult times. It is critical to keep a close watch to ensure that the positive gains through building trust outweigh temporal stressful pressure.
Final Thoughts
In conclusion, the Core Theory of Success can become a powerful engine for sustained, long-term organizational performance. By embedding its principles into the company’s culture, organizations can foster strong relationships, inspire innovative thinking, drive impactful actions and achieve lasting results, creating a dynamic environment for continuous growth and success.
Thomas Lim is the Vice-Dean of Centre for Systems Leadership at SIM Academy. He is an AI+Web3 practitioner & author of Think.Coach.Thrive!