The 6th International Conference
of the System Dynamics Society
1988 – La Jolla, CA USA
The following papers were presented at the conference in parallel and plenary sessions. The original printed proceedings, edited by Nathan B. Forrester, Andrew Ford, Jack B. Homer and Dorothy Nemanich were printed in hardcopy and distributed at the conference. Below please find the Paper Index for these proceedings including abstracts. Papers are listed alphabetically by the last name of the first author. Available papers are Acrobat (.pdf) files and can be read using Acrobat Reader available from adobe.com.
For details about purchasing a copy of the printed proceedings, visit our website System Dynamics Society.
PAPER INDEX – listed alphabetically by first author:
The Design and the Testing of Plans at Government Level in Kuwait
Abstract: This poster is concerned with the application of system dynamics as a decision support tool to assist the five-year development planning process in Kuwait.
The Kuwaiti Government, and in particular the Ministries of the Interior and Planning, have been progressively introducing more elaborate procedures for development planning. A five year plan currently exists and is being implemented. Work is now in progress on the extension of the plan into the 1990’s and a system dynamics group is to be formed to consolidate and extend existing support of the planning process. The group will use micro computer software (DYSMAP2) and plans to train Kuwaiti technicians are underway.
This poster presents an example of how system dynamics is being used in Kuwait to analyse objectives and plans for feasibility and compatibility prior to implementation. The example concerns police labour force planning and preliminary results and conclusions are presented.
System Dynamics as a Support for Cash Management Expert Systems
Abstract: The following is meant to be an example of the combination of an Expert System (XPS) and a System Dynamics (SD) model in which the farreaching effects of cash management decisions in a complex of feedback relationships in a company are illustrated.
The great advantage in proceeding this way is to use the results of an Expert System as constants and initials in a System Dynamics model. That means, that the user is enabled to study the results of a static Expert System in a dynamic model.
The mentioned System Dynamics model is created on the background of an ancillary supplier for the car industry. Rather to simulate the real system in a very detailed way the model reduces this real system to the main areas of the company. As in this paper the point of main emphasis is to demonstrate a possible way of linkage of the two systems a short problem definition is followed by the description of the most important feedback-loops in causal-loop diagrams of the System Dynamic model. Subsequently the outcome of a model simulation with it’s graphic and tabular results is to be analysed under the aspect of influence of constants and initials originating from the Expert System concerning cash management decisions.
A System Dynamics Model of the New Zealand Economy
Abstract: This paper discusses the general structure and implementation of a System Dynamics model of the New Zealand economy. The model, called SDMACRO, has been developed at the New Zealand Planning Council to provide likely trend movements, some 10-15 years into the future, in the key macro-economic aggregates including gross domestic product, capital formation, population, employment, exports, imports, and the current account balance. The base case run of the model is presented together with scenarios which show optimistic and pessimistic future outlooks for the New Zealand economy. In addition, the paper briefly describes how SDMACRO is used with a 22 sector general equilibrium model, Julianne, as part of another Planning Council study which examines national and sectoral development paths of the New Zealand economy up to 1995. Finally, some recent extensions to SDMACRO are outlined.
A Model for Exploring Scenarios Surrounding the Spread of AIDS in the U.K.
Abstract: Figure 1 illustrates the structure of the model.
People flow from a Susceptible Population after invasion by HIV and become members of the HIV population capable of infecting other susceptibles.
Then, infected people either move into a state of
(i) clinical AIDS ( governed by the Symptom Emergence Ratio, SER) or into one of several other states
(ii) die from other unrelated causes
(iii) retire altogether from sexual activity on account of their age
(iv) retire altogether from sexual intercourse as a reaction to knowledge of their condition
(v) acquire a medically non-infectious state
All these states render the host non-infectious since we assume that patients with clinical AIDS will no longer be sexually active.
Participatory Simulations as Training Tools – A Study Based on the Market Growth Model
Ernst W. Diehl
Abstract: A participatory simulation based on the market growth model is developed. The performance of eight subjects is evaluated and compared against the results of simulation analysis of the model. Compared to the benchmark derived from the simulation analysis, the subjects’ performance is surprisingly low. It is argued that participatory simulations can be valuable teaching instruments but that they need to be combined with additional learning support tools.
System Dynamics Simulations for the Management of a Commercial Bank
Abstract: Bank institutions occupy a special position in the economy as they have to guarantee a frictionless money movement. Compared with industrial companies, banks do not produce concrete products but provide abstract services with money as their output object. These services- when they are included in balance sheet- are reflected in the accounts as sales relations. Therefore a balance sheet model is applied in order to reflect general decisions in banking and to show how these decisions affect banking business in terms of volume and profit.
The analysed bank is the London branch of a Continental bank. The branch acts on the markets as a commercial bank. These kind of representations are the most common ones in the financial center of London.
The branch offers four different kind of products: Traditional, specialized, contingent and treasury products. These products determine the statement of asset and liabilities and in addition are also the income earners of the branch.
The behaviour of the branch is determined by decision rules, market developments, the juristical position and internal restrictions. This behaviour is tested by adopting different scenarios.
The System Dynamics bank model is adaptable to individual circumstances of other banks and therefore it offers practical support for the management of financial institutions.
System Dynamics and Uncertainty: Results of Two Applications of Formalized Sensitivity Analyses with System Dynamics Models of the Electric Utility Industry
Abstract: Well structured system dynamic models are often quite useful in the analysis of the policy impacts in the face of multiple sources of uncertainty. Simulation searches for a “robust” policy that performs well under widely varying conditions are often the most rewarding portion of a system dynamics study. This paper reports the results of two studies where the analysis of uncertainty is carried a step further. Here, we are interested not only in policy impacts under widely varying conditions but whether a policy can reduce the uncertainty of the system.
The Effect of Linguistic Structure on the Analytic Paradigm of System Dynamics
Abstract: The purpose of this research is to describe the impact that linguistic structure has had on the method of modeling in system dynamics. In the structuralist framework, language is viewed as a system of signs which structure our patterns of thought and influence our behavior. Learned languages are incorporated into the structure of the unconscious which then contains and constrains the capacity for communication and discourse. Linguistic systems are not isomorphic. Thus, when the language used in communicating social, political, and economic ideas changes, (i.e., from verbal to static linear mathematics; or from verbal to dynamic nonlinear mathematics), this affects the theoretical structure of the discipline. The symbolic linguistic structure employed in system dynamic models offers a powerful alternative methodology for scientists to investigate social reality.
Evaluating the Impact of Financial Repression on the Economic Development Pattern of the Philippines
Abstract: The purpose of this research is to evaluate the relation between the development of financial markets and their institutions and the process of economic growth and development. Throughout the world less developed countries are facing various stages of an international financial crisis. Major banks in the industrialized world, as well as the IMF and World Bank have extended credit to these countries expecting the resulting economic growth to yield the necessary dividends for repayment. However the most expeditious road to growth and development has never been a certain one. One controversy deals with the timing and maturity of the financial institutions and financial markets. This overall process is called “financial deepening.” Previous published research polarizes the role of financial institutions in the process of economic development between supply-leading position and the demand-following hypothesis.
Sensitivity of Econometric Estimates of System Parameters to Changes in Sampling Intervals, Measurement Error, and Process Error
Abstract: Synthetic data methods are used to test the robustness of estimators of the parameters within a simple linear oscillator. Econometric methods are used to estimate the known parameters in the model.
The major result is that the deviations from the estimates to the true values of the parameters increase with the sample interval. The influence from stochastic inputs is marginal.
This is due to, that for great sample interval, the lag in the causal dependency is relatively small compared to the interval between the observations involved.
Generic Models as a Basis for Computer-Based Case Studies
Abstract: For many years, system dynamicists have speculated that most corporate troubles could be explained by a small number (perhaps ten to twenty) of generic models, behavior modes, and syndromes (sets of symptoms) they create. Recent advances have renewed interest in creating management education materials, using such generic models to provide a consistent and known environment for active learning, using actual case studies for realism and detail, and using the computer-supported hypertext format of user-directed inquiry. A project at MIT integrated these advances in computer-based studies. This paper precedes systematic development of computer-based cases; it identifies 17 problematic syndromes and behavior modes. They are generic in the sense that they occur commonly in a variety of companies, as a result of common structures and policies. The 17 were identified from published modeling studies, interviews with executives, and unpublished consulting studies. The list of common corporate syndromes will be used in selecting the cases upon which to base the computer-based case studies. The list should also facilitate the problem-identification phase of consulting for individual corporations.
SDNET: An Integrated Communications Network and Database for the International System Dynamics Community
Abstract: The apparent slow growth of System Dynamics as a field may be due in part to the relative isolation of many practitioners of SD around the world. Not only is the field geographically dispersed and in the minority in most instances, it is also changing rapidly along with the rest of the computer world. In this context, it seems critical that practitioners have easy and timely access to information and people that could both assist and amplify their research and teaching endeavors and give them psychological support to continue working in the field.
SDNET is an integrated electronic network and database that is intended to provide such access to practitioners of SD around the world. SDNET has been developed and tested at USC’s System Dynamics Laboratory as an initiative of the Institute of Safety and Systems Management. It is currently available to be used by anyone who has access to an account on the academic BITNET network or any other electronic network (such as ARPANET) that links with BITNET. The database (SDBASE, housed on an Apple Macintosh) is structured to contain and fully relate information on people and institutions, publications, models, conferences interest groups, and electronic messages in the world of System Dynamics. This information may be easily added to, modified, or extracted upon request.
This poster demonstrates some of SDNET’s capabilities and discusses its current status and plans for the future.
Defense Program Lifecycle Management: A Dynamic Model for Policy Analysis
Abstract: The System Dynamics Lab at the University of Southern California’s (USC) has worked with Hughes Aircraft Company’s Electro-Optical and Data Systems Group to develop a system dynamics model for analyzing alternative policies available to a defense contractor for managing the production program life cycle. Program lifecycle management is of prime importance to firms, like Hughes, that design, manufacture and maintain complex military equipment. These firms have come under increasing government scrutiny and control, particularly with regard to cost and schedule risks.
The USC-Hughes model addresses the notion that cost and schedule risks can be substantially reduced through improved program management, even in the face of possible hurdles thrown up by customers and suppliers. The model suggests, for example, that overruns, particularly cost overruns, may be significantly reduced–without adversely affecting product quality–by carefully limiting the number and type of discretionary mid-production design improvements.
This presentation outlines the background and basic structural elements of the USC-Hughes model, demonstrates the model’s ability to track historical data from two different cases, and highlights some of the policy findings that have emerged from the model.
Can Project Dynamics be Modelled?
Abstract: This paper discusses the author’s version of some of the pros et cons in modern project modelling. His main view is that projects have many features that make them well fitted for using the Systems Approach in the analysis and improvement of their performance, but many of the traditional “rules” for “correct” project execution and monitoring should be questioned. He particularly advocates revision of (1) the traditional firm definition of project boundaries as time, cost and quality which because of the uniqueness and unpredictability of project work, almost always have to be changed or adjusted, but where advice on which one to “adjust” when under pressure seldom exists (2) the necessity of basing the project performance on a strict “sequencing” of the project work when real life project work often experiences substantial “overlapping” between project phases , and (3) using common rigid organizational structures in a project environment where the real requirement is structures that favour the mastering of fast changes and organizational flexibility.
The author then elaborates on how the three arguments above could be part of a more “complete” project model, including a much stronger emphasis on the human factor as a major component in dealing with the suggested more complex nature of project work.
This leads to the authors own version of a more comprehensive Project Dynamic Model. The model is described in the paper by its main features and some of its initial findings, but a fully computer-implemented model using the STELLA compiler will be demonstrated at the conference based on the research undertaken by the author.
The World Oil Market: A System Dynamics Approach
Multi-Criteria Optimization in System Dynamics
Abstract: This paper begins by summarising some milestones in the expansion of the system dynamics methodology to give a background to multi- criteria optimization in system dynamics. The case of ‘Inventory Control Policies’ from Jarmain’s (Editor) “Problems in Industrial Dynamics” is then used as an example to show how Wierzbicki’s method in multi-criteria optimization can be adapted to system dynamics. The solution procedure transforms the model into a discrete trajectory in time.
Financial and Production Planning in a Manufacturing Firm: Dynamic and Multi-Attribute Strategic Analysis
Abstract: In this research we study the dynamic behavior of an industrial firm. Special emphasis is placed on the financing of manufacturing fixed capacity and working capital. Firstly, we construct a corporate model of a sample firm. Then the experimental firm is operated using following strategy groups: cash flow management strategies, depreciation strategies and retained earning strategies.
Next, the emphasis is moved to the evaluation of outcomes. At this stage, an analytical hierarchy process is used. We insist that the decision analyst should decompose the problem into a hierarchy of interrelated decision elements. At the top of the hierarchy lies the most general objective of the decision problem, i.e., the well-being of the firm. The lower levels of the hierarchy consist of various decision criteria. The lowest levels of the hierarchy consist of decision alternatives, i.e., strategy groups. Finally, the best strategy is reached.
Capital Investment Planning for New Technologies- A System Dynamics Assessment on Economic Efficiency
Abstract: Technological investment planning is of crucial importance for industrial enterprises. Successful investment decisions and the right process technology increase the companies competitive strength. If the wrong technology is applied this leads to high fixed costs diminishing the return on investment. Methodical long-range planning is required.
The necessity to introduce new technologies is emphasized in numerous publications. For evaluation of such strategic investments the classical methods of project calculations are not sufficient due to non-consideration of specific economic parameters changed by modern process technologies.
A holistic view will be developed, considering all effects of new technologies on the enterprise. The proposed System Dynamics approach simulates the changes of cost relations due to the introduction of a Flexible Manufacturing System (FMS) in an industrial enterprise.
The handy SD model can be easily adapted to individual circumstances. Therefore, it offers practical support to demonstrate the economic efficiency of capital investment already in the planning stage of preinvestment analysis.
Corporate Simulation Modelling for Strategic Planning: A Modular Approach Based on System Dynamics Method
Abstract: The strategic planning process involves anticipatory decision making for the business as a whole. The integrated functioning of a business and its interaction with the environment are complex enough to comprehend by intuition alone. Choice of modelling strategy as well as method of its application therefore attain significance. Modular approach during corporate model design is recommended for dealing with complexity. System Dynamics method is found most suitable to do so. Corporate model can be constructed from the modules of marketing, production, and finance. Production system has been analysed to illustrate the modular approach using system dynamics method for the purpose of corporate modelling. A generic set of eight basic feedback modules has been designed to model any capacity centre. A few such sets integrated result in model of a production system. This approach has been applied for modelling a steel plant. The production model has been historically validated. It has been extended to incorporate financial consequences. The steel pant model so designed has been used for simulation experiments.
A Model of System Dynamics on Factory Management
Abstract: This paper constructs a system dynamics model which simulates the behavior of the structure of a large radio appliance factory administered by government department in China. Because the factory present focus is orders unfilled and profits reduced, we carry out several policy experiments on the model. The experimental results show that if the factory manager will add sales expense properly and adjust product price in time, orders and profit will been increased to higher level. In addition, the model exposes that there are lack of management systems and policies in state enterprises of China, these problems limit their development.
Input data of the model come from the database of the management information system of the factory. Data are transmitted quickly and accurately. The model is provided with good dynamic state and applied conveniently.
Modeling the Dynamics of a Family in Crisis
Abstract: A model of the dynamics of a family problem was developed as a prototype of future work in family therapy. In this situation, a family was in crisis over the problem of managing the son’s illness. The father refused to recognize the severity of the disease, while the mother begrudgedly took responsibility for the care of the child.
The model describes the dynamics underlying the mutual anger between the parents, the guilt of the father, and the effects of therapeutic interventions on this family system. The output of the model was oscillatory in nature. The timing of these oscillations of the parents anger and the father’s guilt matched the sequence of emotions actually observed by the clinical team when dealing with this family.
The modeler, who was not in possession of all the facts, predicted a relapse of the father’s behavior and a recycling of bouts of anger between parents after about six months following the termination of therapy. The therapists substantiated this prediction, giving confidence in the model.
Subjective Knowledge Bases in Corporate Policy Making
Abstract: Intelligent behavior involves subjective variables, it is guided by fuzzy goals and constraints, and it applies multi-valued rules of inference to reach its conclusion. Decision or strategy support systems- in order to serve as reliable tools for testing the consequences of alternative courses of action- must reflect these essential aspects of the problem under investigation.
The paper presents a corporate model designed for the investigation of a firm’s resource allocation strategy. It discusses the applicability of fuzzy set theory to computer simulation in general and to System Dynamics in particular. After qualitative variables and fuzzy goals have been explicitly included, the model exhibits improved performance with respect to behavior and acceptance by management.
Strategic Microworlds and System Dynamics Modelling
Abstract: In the past ten years, system dynamics has become more accessible to managers and more applicable to strategic issues. The paper reviews developments in software, theory, gaming and methods of simulation analysis that have brought about this change. Together these developments allow modellers to create computer-based learning environments (or microworlds) for managers to “play-with” their knowledge of business and social systems and to debate strategic change.
The Dynamics of Escalation Phenomenon
Abstract: The “escalation phenomenon” (Staw 1976; Staw and Ross 1978) refers to the tendency for decision makers to “throw good money after bad,” that is, to invest beyond the point where benefits equal costs. The commonly accepted view is that such ‘escalation” occurs as a result of decision makers becoming overcommitted to a previously chosen course of action through a series of decision errors. This paper presents a generic system dynamics model of resource recommitment behavior that is able to produce “escalation” without the presence of decision error. Implications of this model to the theory and practice of project management are discussed.
System Dynamics Modelling for the Design of Change
Abstract: While the informal modelling procedure of system dynamics qualifies as scientific according to the definitions of the epistemological literature, the application of this procedure may create models of phenomena that provide few clues to the design of change. Policy design exercises based on such models may often end with a moral statement about what should be done by the organization as a whole instead of providing motivational instruments through which its various members realize evolutionary change. Unfortunately, a change prescribed by a moral statement can only be realized by a powerful intervention by an outside agent which is, if at all possible to implement, often dysfunctional. This paper attempts to define heuristics for the construction of models that may lead to viable designs of evolutionary change. A model is viewed as instrument for understanding a problem not as a source of design. Guidelines for partitioning complex problems into multiple models are discussed. Models containing conservative systems capable of generating a large number of time variant patterns, which are in reality separated by time and location, appear to be sound instruments for facilitating the design of change.
System Behaviors on Educational Problems
Abstract: This paper is attempting at modeling and simulation of an educational problem at junior and senior high schools. Our model consists of seven level-variables, ten rate- variables and twenty auxiliary -variables. Also we discuss marks of students in the model that are figured from 0 to 100. Results of the computer simulation are given to illustrate the our model.
Modeling Managerial Behavior: Misperceptions of Feedback in a Dynamic Decisionmaking Experiment
Abstract: Studies in the psychology of individual choice have identified numerous cognitive, informational,temporal, and other limitations which bound human rationality, often producing systematic errors and biases in judgments and choice. Yet for the most part models of aggregate phenomena in management science and economics have not adopted postulates of human behavior consistent with such micro-empirical knowledge of individual decisionmaking. One reason has been the difficulty of extending the experimental methods used to study individual decisions to aggregate, dynamic settings. This paper reports an experiment on the generation of macro-dynamics from microstructure in a common and important managerial context. Subjects play the role of managers in a simulated inventory management system, the “Beer Distribution Game”. The simulated environment contains multiple actors, feedbacks, nonlinearities, and time delays. The interaction of individual decisions with the structure of the simulated firm produces aggregate dynamics which systematically diverge from optimal behavior. Subjects generate large amplitude oscillations with stable phase and gain relationships among the variables. An anchoring and adjustment heuristic for stock management is proposed as a model of the subject’s decision process. The parameters of the rule are estimated and the rule is shown to explain the subjects’ behavior well. Analysis shows the subjects fall victim to several ‘misperceptions of feedback’ identified in prior experimental studies of dynamic decisionmaking. Specifically, they fail to account for control actions which have been initiated but have not yet had their effect. More subtle, subjects are insensitive to the presence of feedback from their decisions to the environment and attribute the dynamics to exogenous variables, leading their normative efforts away from the source of difficulty. The experimental results are related to prior tests of the proposed heuristic and the generality of the results is considered. Finally the implications for behavioral theories of aggregate social and economic dynamics are explored.
Bifurcation Sequence in a Simple Model of Migratory Dynamics
Abstract: A bifurcation sequence in the Waycross model is studied by means of Poincaré section techniques. The bifurcation parameter B is gradually reduced from 2.00 to 1.50. This parameter measures the inclination of one type of minority families (Lomanians) to move into the districts with many families of another type of minority population (Itrachians). Because of symmetry the attractors in this 4-dimensional migratory model occur in pairs with opposite directions of cyclic population movements. A pair of simple limit cycle attractors are found to remain stable under formation of a pair of period-2 attractors. In a certain parameter range, the model thus contains four entangled attractors. We follow how the period-2 attractor become chaotic through formation and subsequent destabilization of 2-dimensional tori. On the way, regular period-14, period-18 and period-4 attractors are produced through frequency-locking.
We thereafter observe a case of type-III intermittency when the two period-1 orbits become unstable, and finally the two chaotic attractors merge with each other.
Behavioural Sensitivity of the Lotka-Volterra Model
Abstract: The continuous model for a deterministic continuous growth, one-predator-one-prey system is that of Lotka and Volterra. It is well known that this model predicts neutral stability in which the constant amplitudes of the oscillations are determined by the initial conditions. Without changing the underlying model assumptions and by altering only the predator functional response to prey density, it is shown that damped oscillations towards stable equilibrium or explosive oscillations or a stable limit cycle can be generated as model input.
Oscillations and Chaos in Ecological Populations
Abstract: In this poster we analyse the chaotic motion of a model which describes the behavior of a prey-predator-food system.
This system can be modeled by mixing two well known models: the predator-prey model (Henize, 1971) and the Kaibab plateau model, which copes with the prey-food part of the model (Godman, 1974).
This model has previously been introduced in (Toro and Aracil, 1988).
Expert System Dynamics Modeling with GURU
Abstract: The purpose of this paper is to present a possible way in which a marriage between Artificial Intelligence and Modeling can take place. More specifically it is the purpose of the paper to explore some basic concepts related to Artificial Intelligence and by using an expert system shell called GURU to aid in the development of system dynamics models. The concept is one of going from data base to knowledge base to models and to examine the line of reasoning that is used in formulating the problem. Simple examples will explore the potential of this approach.
A Structured Approach to Knowledge Acquisition In Model Development
Abstract: Model development for policy purposes often involves consulting one or more experts to acquire knowledge about the system that cannot be found in the literature. This poses a knowledge acquisition problem: how to derive the necessary knowledge from the expert(s). This is particularly acute if the number of potential experts to be consulted is large, as might be the case in public policy making. In this paper we will discuss a structured approach to consult a great number of potential experts. The approach was developed for the construction of a simulation model of a regional health care system. The adopted approach, however, is sufficiently general to be employed in other model development processes as well.
A Decision Support Model for University Management
P.J. Vermeulen, W.J. Rossouw, M.J. Joubert
An Integrative Approach to Water Resource Management: An Application in Madison, Wisconsin
Abstract: This study describes policy making and its implementation in water resources to facilitate proactive policy making. A system Dynamics model is constructed, evaluated, and revised with extensive inputs of the actual actors/interested parties in the policy arena.
The Relationship Between Health Care Interventions and Morbidity: Some Counter-Intuitive Implications of a Socio-Ecological Model
Abstract: The most fundamental health studies issue is the discrepancy between expected and actual performances of the Health Care System: the deployment of curative biomedicine is expected to decrease morbidity and costs, but we see everywhere a rise in both. Technological lag, environmental damage, administrative slippage, professional pressures, and new wealth consumption are conventional but, at best, partial explanations. It appears that the rationale is flawed by the use of an inappropriate image of the system out of which morbidity phenomena emerge. The Socio-Ecological Model proposed here links HCS operations with a more appropriate morbidity construct. The individual’s subsystems interact with the social-physical environment to create two distinguishable types of morbidity: anatomico-physiological conditions constituting the ‘lesions’ of the disease process, and interacting experiential, behavioural, and role changes of the illness state. The HCS becomes a significant part of the sick person’s environment, and affects the four resulting sub-populations differentially. Care and prevention goals are to move sick individuals/populations toward illness-free and disease-free quadrants and to prevent/slow movement away from them. The counter-intuitive HSC production of morbidity (through, e.g., coronary care, increased life expectancy, pursuit of fitness, early diagnosis, and psychosocial counselling) is no longer surprising. The model suggests a revision of health planning goals, with major shifts in resource allocation.
The Effectiveness of Management Information Systems
Abstract: There are a large number of references in the literature to the problem of evaluating Information Systems in terms of both efficiency (the technical aspects) and effectiveness (the user’s view, and the effect the system has on the organisation). Whereas the efficiency can be defined clearly in mathematical terms, measurement of effectiveness tends to be subjective and is usually measured retrospectively (i.e. some time after installation) using a questionnaire approach, or by expensive simulators, prior to installation.
This presentation deals with the initial thinking behind the development of a quick and less costly system dynamics approach to measuring effectiveness, by using a simple model to examine the effect the proposed system will have on the organisation into which it is to be installed.
Description of Microeconomics by System Dynamics
Abstract: Some principle conceptions in microeconomics are simulated by System Dynamic (in brief S.D) in this article. The simulating of two fundamental theories in microeconomics concerned with balanced prices and margin analysis leads to some significant conclusions. Most of these conclusions are now in heated argument in microeconomic field. Our achievement is provided as a test of the proceeding ideas.
Using System Dynamics Method to Analyse an Enterprise
Abstract: This paper establishes a system dynamics model to analyse a dynamic productive procedure of an enterprise in Shanghai. The model consists of five sectors, order and supply sector, production sector, material sector, advertising sector and financial sector.
There are many products which the enterprise expects to produce, and in the model these products are transformed into two standard products according to the kind of products. The paper analyses the impacts of some soft factors, such as worker’s quality, bonus, advertising, etc., on the profit, and also the policy of purchasing materials. The model presents the strategy of how to work out plans between two standard products when the input surpasses the productive capacity of the enterprise.
The model is run by using real initial input values in 1985 and 1986. The results are very close to real situations of the enterprise. The sensitivity tests shows that the model is insensitive. So it is adquate
to consider that the model is reliable and can be used as basis for dicision making by managers.
Inventory Control and Forecasting
Abstract: This paper provided a two-stage invertory system. It Descrips its problem behavior and structure implement. Analyse the policy design: use inventory and backlog to absorb differences between production and demand, change production to match change in demand, change demand to match production abilities, finally, forecasting reslove permanat and temorory change and lag in production’s responce to change.
A System Dynamics Approach to the Car Ownership Trend in Taiwan Urban Areas
Abstract: The economy in Taiwan grew rapidly in the last decade. This steep increase strongly affects its transportation system: the number of cars in the urban areas increased dramatically. Some studies forecasted that the number of car in Taiwan urban areas in 2000 will be three times of that in 1984. However, those studies did not consider the feedbacks from the traffic and parking conditions to the car ownership. In addition, some of the possible changes in the system environment are also not being considered, such as the increasing life expectancy of the car, the shortening car renewal period and more and more attractive car purchasing loans policies. This study is an attempt to apply system dynamics methodology to analyze the trend with inclusion of feedback and the above mentioned system environment changes. The results show that due to feedbacks from the limited capacity of roadway and parking and the influence from the system environment, the number of cars in urban areas will only be doubled in the year of 2000. Although the data for this research were very limited, by using the system dynamics methodology we are able to have a better picture of the future trend of car ownership in Taiwan.
The Application of System Dynamics in Solving a Dynamic Input-Output Model with Delays
Abstract: Since the dynamic input-output method was put forward by W. Leontief, some results have been obtained to a greater or less degree in various fields of quantitative economy, which have played an important role in the application of the method. Yet, insolving the delay-having dynamic input-output models, whether the matrix converse exists or not has not had sufficient mathematical proofs. Having taken these problems into consideration, our paper attempted to solve the problem of multiyear delay-having dynamic input-output model with the application of the properties of system dynamics in structure and time sequence, the properties of BOXLIN and SUM functions, and has combined these two models, the combination of which is possible in the sense of the economy. The DIOSD (Dynamic Input-Output and System Dynamic Model) not only has the advantage of man-and-machine conversation as well as screen display, but also we can put the DIOSD completely into the SD model with the consideration of the overall system structure. Therefore, we can make full use of the advantages of the dynamic input-output model in economy planning and forcasting, and also provide an efficient tool for its future application.
last updated by ng on 11/25/08