This is the second post in our series on breaking down complex ideas that are often buried under layers of academic jargon. We’re showing how these concepts, when applied practically, can transform the way leaders, teams, and organisations operate.
In our first post, we explored Systems Theory – how organisations function as interconnected systems where every change has ripple effects. Now, we’re adding another layer.
At its core, Systems Psychodynamics connects two essential aspects of organisations: the structural (systems, processes, roles) and the human (emotions, relationships, unconscious behaviours).
Rethinking ‘psychodynamics’
We avoided using the word psychodynamics in the early days of ig. Because for many of us, it brings to mind a bespectacled therapist stroking their chin while we lie on a couch and talk about our feelings – not a powerful pattern breaker that can have rapid impact on performance.
In reality, it’s a sharp, practical way of understanding why organisations (and their people) behave the way they do. This approach focuses on recognising the emotional undercurrents and unspoken rules that shape decision-making, team dynamics, and leadership effectiveness.
It makes the invisible visible, helping leaders navigate what’s really going on rather than just dealing with surface-level symptoms.
Why it matters
1. Organisations are complex systems
Every organisation is an interconnected system, made up of teams, departments, and individuals that are constantly interacting with their environment. A change in one area affects the whole. Systems Theory helps leaders see these connections and identify the real levers for meaningful change.
2. People drive organisational performance
Organisations don’t just run on strategy and structure: they run on people. Emotions and relationships shape decision-making, collaboration, and culture. Psychodynamics helps leaders understand these (and have the difficult conversations) rather than just reacting to surface-level symptoms.
How it helps
Systems Psychodynamics can be a difficult approach to sell to key stakeholders. It can’t be boiled down to a discrete model that can be copied, dragged, and dropped throughout an organisation.
It’s grounded in curiosity and is a collaborative effort between the facilitator and the team; it embraces nuance, encourages personal and collective accountability, and focuses on longitudinal impact (rather than point-in-time reductive ‘solutions’).
Because of this, it can’t be summarised into a simple framework. But here are some common applications that we see in our work to give a sense of the approach in action (for more detailed examples, check out our case studies here).
Overcoming resistance to change
When a change initiative sputters, the default is often to place the blame with flawed strategy; but oftentimes, the ‘human’ element is a more powerful decelerator. For example, unspoken fears and unconscious resistance are common barriers to change. People worry about what they’ll lose, how their role will evolve, or whether they’ll still belong in the new structure. These anxieties don’t always get voiced, but they shape behaviour.
Take a leadership team trying to roll out a new company-wide structure. They’ve communicated the strategy clearly, but middle managers seem to be dragging their feet. It’s easy to assume they’re just being difficult. But a systems psychodynamics lens can reveal a deeper issue: they feel like they’re losing power and control. Until this emotional resistance is acknowledged and addressed, the change will stall, no matter how well-designed the plan is.
Addressing team dysfunction
When teams struggle with conflict, poor communication, or underperformance, surface-level solutions can struggle to address the problem. These challenges can stem from relational dynamics, unspoken tensions, or unclear roles.
For example, a formerly high-performing team suddenly starts missing deadlines and second-guessing decisions. On paper, it looks like a time management issue. But a deeper look reveals the real cause – a senior team member left, and now no one knows who holds the authority. The lack of clarity is creating hesitation, second-guessing, and bottlenecks. Instead of imposing stricter deadlines, the real fix here is coming to a consensus about how to address the power vacuum – making lines of accountability explicit and resetting expectations.
Navigating leadership challenges
Leaders often struggle not because they lack skills, but because they’re unconsciously pulled into patterns shaped by past experiences or organisational culture.
A newly appointed CEO, for example, might struggle to connect with their executive team despite having a clear vision. On the surface, it seems like a leadership style issue. But in reality, the team unconsciously sees them as “not the real leader” because they’ve replaced a much-loved predecessor. Without recognising this emotional undercurrent, the CEO risks fighting unseen resistance. Addressing the group’s attachment to the previous leader and helping them transition is what will unlock real alignment.
Key principles of systems psychodynamics
Emotions are data
Anxiety, frustration, excitement – these aren’t just distractions. They can reveal unspoken organisational tensions. Paying attention to emotions helps leaders diagnose what’s really happening beneath the surface.
Context shapes behaviour
People don’t act in isolation. Their behaviour is influenced by the pressures of their environment (read our blog on valencies for another helpful concept in this area). Understanding this bigger picture can help stop leaders from misdiagnosing what appear to be individual issues as personal failings.
Boundaries matter
Clear boundaries – between roles, authority, and responsibilities – keep organisations functioning. When boundaries blur, tensions rise. Systems Psychodynamics helps leaders notice and manage these tensions before they become major issues.
Creating space for reflection
Leaders and teams need time to step back, challenge assumptions, and grapple with emotionally charged situations. Making space for this reflection allows deeper insights and better decisions.
Why we use this approach at ig
At ig, we apply systems psychodynamics to help leaders and teams make sense of complexity, navigate change, and build healthier organisational cultures.
We’re not dogmatic about sticking to one approach – we like a good model as much as the next person (like our X-Model for diagnosing team effectiveness). But we’ve found that no intervention is complete without considering both the system and the psychodynamics at play – and, more importantly, how the two interact.
Ignoring one side of the equation leads to half-baked solutions. The real impact comes from understanding both the structure and the human dynamics that shape it. Want to learn more? Read about our work here ; or get in touch at info@indigogold.com to start a conversation.