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Introduction To System Dynamics

The document introduces System Dynamics, emphasizing the importance of interconnected parts, feedback loops, stocks, and flows in understanding system behavior. It distinguishes between reinforcing loops that amplify change and balancing loops that seek equilibrium, while also highlighting the significance of time delays in system responses. Key applications include supply chain management, market growth modeling, and resource management.

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10 views1 page

Introduction To System Dynamics

The document introduces System Dynamics, emphasizing the importance of interconnected parts, feedback loops, stocks, and flows in understanding system behavior. It distinguishes between reinforcing loops that amplify change and balancing loops that seek equilibrium, while also highlighting the significance of time delays in system responses. Key applications include supply chain management, market growth modeling, and resource management.

Uploaded by

ULtra
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as TXT, PDF, TXT or read online on Scribd
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Introduction to System Dynamics

- Core Concepts: Systems are composed of interconnected parts. The behavior of the
system arises from these interactions, not just the parts themselves. Focus on
feedback loops, stocks, and flows.

- Feedback Loops:
- Reinforcing Loops (Positive Feedback): Amplify change. Examples: population
growth, compound interest. A small change leads to an even bigger change in the
same direction. Creates exponential growth or collapse.
- Balancing Loops (Negative Feedback): Seek equilibrium or a goal. They
counteract change and provide stability. Examples: thermostat regulating room
temperature, supply and demand.

- Stocks and Flows:


- Stocks: Accumulations, things you can count at a moment in time (e.g., water in
a bathtub, money in a bank account, population).
- Flows: Rates of change that affect stocks (e.g., faucet filling the tub,
interest earned, birth rate). Inflows increase stocks, outflows decrease them.

- Delays:
- Time delays are critical in systems. The consequences of an action may not be
felt immediately.
- Example: A company hires more staff to meet demand. It takes time to train
them, so the impact on productivity isn't instant. Ignoring delays can lead to
overcorrection and oscillation.

Key Takeaways for Analysis:


1. Identify the key stocks and flows in the system.
2. Map out the feedback loops—which are reinforcing and which are balancing?
3. Consider where time delays exist and how they might affect behavior.
4. Look for unintended consequences that arise from the system's structure.

Application in Business:
- Supply Chain Management: Understanding delays in shipping and production.
- Market Growth: Modeling how word-of-mouth (a reinforcing loop) drives product
adoption.
- Resource Management: Balancing the use of a resource (outflow) with its
replenishment (inflow).

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