Yes this is how every Unix command line utility works.
There is nothing unique about jq in this regard, and there is nothing particularly “systems thinking” about any of them. You can and people have used them for decades without doing any special “systems thinking”.
The Unix model is really useful in my systems thinking precisely because thousands of components all use the stream in/out approach. This made then reliable within a system to be used together in many different combinations and interactions.
Also a good example of loose coupling that allows for good thinking of systems.
There is nothing unique about jq in this regard, and there is nothing particularly “systems thinking” about any of them. You can and people have used them for decades without doing any special “systems thinking”.