ABSTRACT

This chapter explains enough about system dynamics (SD). Any action taken in an organization, any decision made, or any system operated represents a process. The purpose of using the simple view of a process is to illustrate how SD differs from typical modeling approaches used in businesses and organizations. Because the statistical approach only uses data, this data must be perfect to create a trend curve in which the analyst has high confidence. In contrast to the statistical modeling approach, the structural modeling approach focuses on the activities that occur within a process. To repeat, the structural modeling approach does not focus on data but instead, focuses on the process activities themselves. SD is a powerful structural modeling technique that can capture the feedback loops that drive the behavior of organizations or social systems over time, both in the short term and in the long term.