Mental Models For Managing Change - Second Order Thinking

Welcome to a very special mini-series on The Inner Game of Change. I’m thrilled to take you on this journey as we explore something both timeless and practical: Mental Models for Managing Change.

In this episode, we explore a mental model that invites us to look beyond the immediate impact of change: Second-Order Thinking.

So often, change initiatives are shaped around what we expect to happen next. But in reality, change rarely follows a straight line — and first-order decisions often lead to second and third-order consequences we did not anticipate.

Second-Order Thinking encourages us to slow down and ask better questions — “And then what?” It helps us move beyond short-term fixes and consider the ripple effects, unintended outcomes, and longer-term dynamics our decisions might set in motion.

If you have ever implemented a change that worked on paper but created new challenges in practice, or if you are aiming to lead change that truly lasts, this episode offers a practical lens to deepen your thinking and strengthen your strategy.

Listen now to discover how Second-Order Thinking can help you lead change with foresight, clarity, and intention.

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Ali Juma
@The Inner Game of Change podcast

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Episode Transcript

Ali (00:09):
Hi everyone and welcome back to the Mental Models for
Managing Change.
I am Ali Jima and I'm sopleased you're tuning in.
If you've been following alongin this mini-series, you will
know we've been exploringpractical, timeless ways of
thinking that can help us managechange more thoughtfully and
lead it more effectively.
Now, before we jump intotoday's model, let's quickly

(00:33):
revisit what a mental modelactually is.
It is basically a way of seeing, a mental framework that helps
us make sense of things, solveproblems and make better
decisions.
You can think of it like a GPSfor your thinking and to bring
that to life, imagine you'redriving to a place you've never
been before.

(00:53):
No map, no directions, justvibes.
Chances are you'll take a fewwrong turns, maybe end up a bit
frustrated, right, but with amap, your mental model, you've
got a route.
You can anticipate what's ahead, avoid unnecessary detours and
get to where you want to go withmore confidence and less stress

(01:16):
.
Mental models do the same forchange.
They help us cut through noisespot patterns and work with
complexity, not against it.
In our last episode, we lookedat the iceberg model, a powerful
tool that encourages us to lookbeneath the surface of change
Rather than just reacting toevents.

(01:38):
We explored how to noticepatterns, understand systems and
challenge mental models.
Today we're going one stepfurther, because you've looked
beneath the surface.
A natural next question is whathappens next?
That's where today's mentalmodel comes in.
It is called second-orderthinking and it is all about

(02:01):
anticipating the ripples ofchange, not just the splash.
Let's start with the basics.
We use first-order thinking allthe time.
It is our go-to.
It asks what happens if I do Xand usually stops there.
But second-order thinkingpushes us further.
It asks and then what it'sabout?

(02:23):
Looking beyond the immediateoutcome and considering the
longer-term consequences,especially the unintended ones.
In change work, this is gold,because change doesn't happen in
a vacuum.
One shift often leads toanother and another.
Second-order thinking gives usthe space to pause and explore
these ripple effects before theyshow up uninvited.

(02:46):
So where does this show up inour work?
Second-order thinking isespecially useful in the
planning and impact assessmentstages of change.
It helps you to think throughpossible stakeholder reactions,
anticipate system-wideconsequences and strengthen risk
analysis and mitigationplanning.

(03:07):
You might use it when you'redrafting a communication plan,
reshaping a process, or evenwhen coaching leaders through
tough decisions.
It is particularly powerfulwhen paired with Iceberg model.
You look beneath the problem,then look ahead to see what your
actions might set in motion.
A quick analogy let's say yourorganization wants to improve

(03:31):
collaboration.
A quick analogy let's say yourorganization wants to improve
collaboration.
First-order thinking might leadyou to introduce a shared
workplace like Slack orMicrosoft Teams.
Second-order thinking asks whatbehaviors might this
unintentionally encourage?
Could it help peoplecollaborate more or just
overwhelm them with messages?
Will it bring some teamstogether or solid them digitally

(03:54):
?
Same decision deeper lens.
So where does this model comefrom?
Second-order thinking has deeproots in strategy, economics,
investing and systems thinking.
A name that often comes up isHoward Marks, a well-known
investor, who said first levelthinking is simplistic and
superficial.
Second level thinking is deep,complex and convoluted.

(04:18):
And while that quote mightsound heavy, this model is
actually quite accessible.
It is simply about slowing downyour thinking, being curious,
asking what might this decisionlead to and what might that lead
to.
So when do you use second orderthinking in change management?
Let's try it out.
Say you are leading arestructure to flatten the

(04:40):
hierarchy.
First order thinking says fewerlayers, more empowerment done.
Second order thinking addsnuance.
Will removing middle managersaffect team morale?
Might some decisions get stuckbecause no one's sure who owns
them.
Could informal networks, theculture glue, start to dissolve

(05:01):
without those key people?
These are the kinds ofquestions that help you avoid
unintended friction and getahead of issues that might
otherwise catch you off guard.
How to practice second-orderthinking.
Here are three simple ways tobuild this into your process.
Number one ask and then whatMultiple times.

(05:21):
Don't settle for surface-leveloutcomes.
Play it out.
Number two flip your success.
If this works perfectly, whatmight go wrong because of that?
Yes, even success has sideeffects.
Number three think in timelines, math the decision over time.

(05:42):
What's in week?
One Effect, one month, sixmonths?
It's amazing what shows up whenyou zoom out and remember.
The point isn't to get it allright, it is to create space to
think.
That alone makes a difference.
So what's your challenge forthe week?
Take something you've beenworking on a rollout, a strategy

(06:03):
, even a team change and applysecond order thinking.
Ask what might happen as aresult.
What else might be impacted?
Are there knock-on effects?
I haven't considered yet.
Spend just five minutes hereand I promise you you will
service something new.
Thanks again for joining me onthe Mental Models for Managing

(06:25):
Change.
If this one sparks somethingfor you share it with a
colleague or message me.
I always love hearing how theseideas land in the real world.
And next time we are buildingon this further with a model
that helps us understand how ourbeliefs and assumptions shape
our decisions, often without usrealizing it.

(06:45):
That's right.
We're exploring the ladder ofinference.
Until then, I'll leave you withthis the ladder of inference.
Until then I'll leave you withthis.
Every action we take createsechoes.
Some we hear right away, othersonly much later.
Second order thinkers listenfor both.
Until next time, thank you.