Small System dynamics models for big issues

Abstract

System Dynamics (SD) is a method to describe, model, simulate and analyze dynamically complex issues and/or systems in terms of the processes, information, organizational boundaries and strategies. Quantitative SD modeling, simulation and analysis facilitates the (re)design of systems and design of control structures (Wolstenholme 1990). SD is in fact the application of the principles and techniques of control systems to organizational and social-economic-environmental-. . . problems. SD starts from the assumption that the behavior of a system is largely caused by its own structure. System structure consists of physical and informational aspects as well as the policies and traditions important to the decision-making process in a system (Roberts 1988). Hence, in order to improve undesirable behaviors, the structure of the system needs to be changed. SD allows to identify desirable system changes and test them in a ‘virtual laboratory’. The SD approach was developed at the end of the nineteen-fifties and the beginning of the nineteen-sixties by Jay W. Forrester, at the Sloan School of Management of the Massachusetts Institute of Technology (Forrester 1995; Forrester 1958; Forrester 1961; Forrester 2007a; Lane 2007). He argued that the traditional methods for solving problems provided insufficient understanding of the strategic processes involved in complex systems. In his writing, Forrester scaled up from the company level in Industrial Dynamics (Forrester 1961) over the city level in Urban Dynamics (Forrester 1969) to the world level in World Dynamics (Forrester 1971). The latter work was the impetus to the well-known Limits to Growth report (Meadows et al. 1972) commissioned by the Club of Rome, and its successive updates. Beyond these important topics, SD is used today for almost any dynamically complex issue. Important application domains in SD are health policy, energy transitions and resources scarcity, environmental and ecological management, safety and security, public order and public policy, social and organizational dynamics, education and innovation, economics and finance, organizational and strategic business management, information science, and operations and supply chain management. Almost all of these domains are addressed in this e-book, but none of them deeply and broadly enough to do them right. Section 21.3 on page 276 therefore contains references to suggested reading in SD, and section 21.4 on page 277 to some good SD entries into each of these application domains.