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Conference Proceedings The 14th International Conference of the System
Dynamics Society
The following papers were presented at the conference in parallel, plenary, and poster sessions. The original printed proceedings, edited by George P. Richardson and John D. Sterman, were printed in hardcopy (Volume 1: A-L and Volume 2: M-Z) and distributed at the conference. Below please find the Paper Index for these proceedings, including an abstract when available. 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 http://www.adobe.com. For details about
purchasing a copy of the printed proceedings, visit our website System Dynamics Society or send an
email message to system.dynamics@albany.edu. PAPER INDEX - listed alphabetically by first author: |
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Ann Van Ackere Peter Smith |
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Abstract: The United Kingdom National Health Services (NHS) delivers 95% of the country's health care. It is a public sector organization, which delivers health care free of charge at the point of access. With the exception of emergency services, patients cannot refer themselves directly to NHS hospitals. Instead they must be referred by a family practitioner, who acts on the "gatekeeper" to hospitals health care. If referrals give rise to excess demand, rationing takes place in the form of waiting list for non- emergency procedures. There is a small private sector which is used by some patients who have the means to bypass the NHS queues. |
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Clients' Opinions on Group Model-Building: An Exploratory Study |
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Henk Akkermans Jac Vennix |
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Abstract: Building models of strategic issues with a group of the stakeholders has become an established approach to support strategic decision- making. Involving these stakeholders helps to generate relevant information regarding the issue and at the same time creates ownership of and consensus on the resulting group recommendations for dealing with the issue. In this way, group model building creates managerial commitment to implement these recommendations. |
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Prikka-Matti P. Alanne Anil B. Jambekar |
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Abstract: Systems thinking tools are particularly useful for diagnosing the problems for the situations with known history and insights are generated by structuring the assumptions to uncover causes of significant problems. An objective of this paper is to put systems thinking to use by showing how the problems faced by the case company were due to collective actions of several functional units of the organization. The focus here is to illustrate through casual loop diagramming the consistently recurring themes during the case company's attempt to adopt quality management concepts. The paper concludes with generic insights equally applicable elsewhere. |
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Efficiency In Sustainability - The Efficient Life Styles of Kerala |
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William Alexander |
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Abstract: The Kerala Phenomenon, high life quality, has been called " A Mystery Inside a Riddle Inside an Enigma" A [SCIENTIFIC AMERICAN, March 1995]. More particularly, Kerala is an unexplained economic phenomenon-- high life quality measures, including first-world size families, at very low income levels. Within India, Kerala is a small state (3% of 930 million). Yet in a size ranking of the 128 world nations, Kerala is larger than the first 98. |
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Louis Edward Alfeld |
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Abstract: The Rural Community Modeler (RCM) presents a prototype version of a simulation model that recreates the behavioral dynamics among many rural community elements. The model forecasts how different community elements change over time due to the adoption of specific actions or policies or natural growth or aging. In every community, changes result from a combination of natural forces and public policy. RCM describes why these chances occur, how they can be influenced and what to expect in the future. Individuals and organizations using RCM will gain a better understanding of the forces that shape their community as well as insights into actions that will successfully influence those forces. RCM demonstrates how an urban dynamics model might be constructed, how it would function and what supporting data would be required to make the model a functional planning tool. |
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Louis Edward Alfeld Robert M. Sholtes |
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Abstract: IBAM is a production chain simulator. IBAM simulates the flow of orders and products among the many suppliers and subcontractors that combine to produce an end item. The U.S. Department of Defense has used IBAM to analyze the erosion of its critical manufacturing base in an era of declining defense budgets and to identify potential bottlenecks in the event of renewed defense acquisition requirements. IBAM can also provide support for analyzing industrial competitiveness, planning regional economies, and building “virtual” manufacturing organizations. The model identifies key manufacturers, assesses labor needs, forecasts technology impacts and prioritizes policy options, all with little effort. The model benefits users by pinpointing potential bottlenecks and quantifying the relative costs and benefits of alternative solutions. |
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E.G. Anderson N.R. Joglekar |
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Abstract: This paper used the system dynamics methodology to integrate the dynamics of technological innovation into a formal model of business strategy. This model- known as the Technology Ramp- Up Stimulator (TRUSIM)- specifically focuses on the evolution of technological performance and competitive structure. TRUSIM links existing firm management system dynamics structure to new modules representing the dynamics of innovation and that of technological capability. This model will be used to explore several typical scenarios of industrial evolution, such as technological lock- in and first- mover disadvantage. |
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Microworlds: A System Dynamics Application in Learning Keynesian Macroeconomics |
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Hugo Hernando Andrade Sosa Jaime Daniel Mejia Castro Ricardo Vicente Jaime Vivas Jose Alberto Pinto Mantilla |
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Abstract: Teaching economy in colombian universities is so difficult, specially in curriculums for students of fields different to economy, in which economy courses are often so little motivating, and there are developed with a very specialized terminology, difficult to be well understood; in addition to that, there are big troubles in testing in real world whether student's ideas to control an economic system are effective or not. Computer science offers new tools in all human activities, including education. Here it is presented HICEFE (Computational tool for Comprehension and Experimentation with Economic Phenomenon) that is a proposal to incorporate computational technology in teaching economy, and to reinforce the application of a systemic approach in the educational process, feasible of being used in different study fields. Models that conform the tool have been made with Systems Dynamics methodology, to be presented like microworlds that offer to the user the opportunity to study economic phenomenon, evaluating the student's understanding by experimenting with stimulated solutions to problems. |
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Hugo Hernando Andrade Sosa Alvaro Ramirez Garcia Jose Daniel Cabrera Cruz |
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Abstract: This paper is a continuation of one presented in the 1994 International Conference on System Dynamics. That was an opportunity to discuss about the industrial importance of chain polymerization process: to present a model of the reactions taking place and the dynamics of molecular species calculated by a corresponding mathematical model using SD methodology. This paper presents a more complete model of the reactions occurring in the process, the corresponding mathematical model and a comparison of results: those calculated with a traditional, non SD approach, ours using SD and those gathered experimentally. |
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The Impact of Environmental Policy on a Firm's Behavior - A System Dynamics Approach |
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Maria Paula Antunes Rui Santos Nuno Videira |
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Abstract: Pollution control policy has relied on the use of command and control (e.g. emission standards) and market based (e.g. emission taxes or permits) instruments, to promote the attainment of established environmental quality objectives. In the design of such instruments a process-oriented approach, directed to the control of emissions in production processes has traditionally been followed. More recently, the adoption of a product- oriented approach, where the environmental performance of products is controlled, namely through a lifecycle analysis, has been viewed as an alternative and a complement to traditional environmental policy instrument. |
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Walking Through the Minefield: How Systems Thinkers Avoid Fallacies of Perception and Action |
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Daniel Aronson |
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Abstract: This paper describes how those trained in systemic thinking (whether system dynamics or systems thinking) avoid the reasoning pitfalls among those not trained to think systemically. I will discuss how systemic thinking provides advantages in two fundamental areas: in avoiding underestimation or misattribution of relationships when constructing an understanding of a situation, and in providing better action based on that understanding. Its strength in these areas gives it a great advantage over the thinking commonly employed by those who have not been trained systematically and is, I believe, one of the main reasons for the superior results obtained by interventions based on systems thinking versus those based on other methodologies. |
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William B. Arthur Robert L. Eberlein |
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Abstract: Systems dynamics modelers normally develop models and implement findings from a deterministic perspective. This approach has great merit. It focuses attention on system structure and behavior as well as ways to change them. Once developed, however, a good system dynamics model is an excellent tool for analyzing systems behavior under a wide variety of parametric assumptions. Though such sensitivity analysis can (and should) be done manually through repeated simulation, automated tools allow more complete exploration. Moreover, they can provide information on the distribution of outcomes that strongly effects decision-making. In this paper we present the basic ideas behind doing multivariate sensitivity simulations (MVSS) and describe how these have been implemented in Vensim. Then, we present a case study that uses MVSS in the pharmaceutical industry. |
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Decision Support for Strategic University Management: A Dynamic Interactive Game |
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Yaman Barlas Vedat G. Diker |
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Abstract: The main objective of this research is to construct an interactive dynamic simulation model, on which a range of problems concerning the academic aspects of a university management system can be analyzed and certain policies for overcoming these problems can be tested. More specifically, the model focuses on long-term strategic university problems that are dynamic and persistent in nature, such as growing student-faculty ratios, poor teaching quality, low research productivity. The model generates teaching, research and professional projects. To construct such a game, a systemic feedback model of the major academic aspect of a university system is built. The model consist of twelve sectors: Graduate Instruction, Undergraduate Instruction, Graduate Instruction Quality, Undergraduate Instruction Quality, Graduate Faculty Instruction Overhead, Undergraduate Faculty Instruction Overhead, Graduate Faculty Research, Undergraduate Faculty Research, Graduate Faculty Projects, Undergraduate Faculty Projects, Laboratory Facilities and Assistant sector. |
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Product Diversification and Quick Response Order Strategies in Supply Chain Management |
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Yaman Barlas Ayse Aksogan |
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Abstract: Quick Response is a new supply chain management system designed to meet the changing requirements of an increasingly more competitive market in the apparel sector. The main objective of this study is to build a Systems Dynamics stimulation model of the portion of the textile and apparel pipeline including the retailing and wholesale processes to search for inventory decisions and policies that yield reduced costs/increased revenues in terms of the retailer. As seen in Fig. 1, the model not only includes the main components of supply chain, but also incorporates how product diversity may affect sales, There are two conflicting effects: first, as the product diversity of the store increases, the probability that customers' preferences will be matched increases towards 1.0 asymptotically. (See Fig. 2a). This graph not only makes sense, but can also be obtained by probabilistic analysis, using Binomial probabilities (Barlas & Aksogan 1995) The opposite effect of increasing diversity implies lower stocks of each product type ("Typesupply"). Thus as the ratio type supply/demand decreases, higher fractions of demand will be lost due to type stockouts. (As shown in Fig. 2b) Therefore, the conflicting effects of product diversity is potentially worth investigating dynamically. |
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A Simulation Model for Telecommunications Services Partially Substituting |
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Antonio Barron Silvio Martinez Jose Maria Lopez |
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Abstract: In the S.D. conference (1. 993), was exposed the Mistela, an integrated simulation model applied to a Telecommunications Operator. This described among other questions, the forecast demand equations of traditional services with historical data (monthly, since 01. 1980 to 12. 1992), based on conventional econometric procedures. However, the provision of demand of new services can not be made by this method, and we appealed then to other kind of model. In the new version of Mistela the demand equation of a new service draws a logistic curve, Thus we appeal to Lotka-Volterra models, so of the kind predator- prey, based on the following analogy: The total market is the roof, or the saturation level, and the behaviour of each predator would be connected among them, so the pure logistic would be modified as a function of aggressivity among the services. Such aggressivity depends of the price policy, the relative quality, ...., of the market strategy in short. |
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A Contemporary Masters Program in Systems Thinking and System Dynamics |
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John Barton |
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Abstract: N/A |
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A Framework for Addressing Contemporary Management Problems |
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John Barton |
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Abstract: N/A |
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A Policy Model for a Retail Water Company in Australia |
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John Barton Purnandu Mandel |
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Abstract: N/A |
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Recycling of Building Materials |
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Eric Bave |
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Abstract: N/A |
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Gary A. Bell J.O. Jenkins |
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Abstract: On inspection of the cost estimation problem it was realised that there are two equally important areas of concern which are; cost explanation, and cost accuracy. A survey of previous cost models applied within the software engineering discipline suggest that there are three distinctive groups which are labelled: The Reductionism Group; The Dynamic Group; The Systemic and Dynamics Group. Key characteristics and archetype models associated with each cost modelling group are briefly outlined. It will be shown that forecast from the reductionism and dynamics cost modelling groups are inaccurate, and their explanations of projects cost are poor. Therefore, alternative mathematical techniques need to be researched. Systems dynamics has been selected, because it focuses on explanation which is seen as a strength. The aim of this research is to develop a negotiation model that explains software project costs. |
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Mario Benassi Roberto Berchi |
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Abstract: Organization design can benefit from the utilization of the current available simulation techniques. The utility is greater where new organization profiles are in experimentation phase. This work has been developed as part of a larger study (still in process) related to the experimentation that is developing in manufacturing. We are observing the creation of manufacturing units that manage, nearly independently, the manufacturing and the related supporting processes. One of the peculiar characteristics of these organizations is the way these units manage the suggestions (technical, management, maintenance) coming from the employees. The New Holland case shows the dynamics of transformation of the suggestion processing and implementation. The models developed clarified the reasons of some problems observed and suggested some possible corrective actions. |
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Edwin Benigno |
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Abstract: The Philippine government launched the Grains Production Enhancement Program (GPEP) in selected areas of the country most suited for grain production leaving the less productive areas for the production of commercial or cash crop. One of the projects under this program is the loss of rice and corn grains from harvest until storage and compare these figures with losses estimated from researches conducted in the Philippines. In the future, periodic surveys will be done to assess the progress of postharvest technology in the country. |
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Global Change Education: The Use of System Dynamics Concepts for Science and Policy Interface |
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Dan S. Bernstein |
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Abstract: My primary research interest is in improving communication between atmospheric scientists on the one hand and the general public and policy makers on the other hand. Miscommunication is delaying the implementation of effective policy intended to mitigate global climate change caused by human intervention. Solution to the problem of global warming will have to be formulated by policy makers working cooperatively with scientific experts. This global problem will require global cooperation and solutions. If there is to be rational and effective policy regarding global warming, policy analysts and the public need to be better understand the environment. Effective communication and education are paths to better use of scientific knowledge. A higher level of understanding can lead to better analysis and design of the best policies for reducing the rate of environmental change or adapting to it. |
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Carmine Bianchi Alfredo Moscardini |
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Abstract: The incremental view in budget formulation is still widespread today, particularly in the Public Administration context. Quite often, such an approach offers politicians an expedient to artificially inflate expected tax revenues that can budget for higher expenses and promise higher financial subsides to a wider circle of voters (i.e.: unemployed, trade unions, industrial representatives, etc.) In this perspective, budget formulation is only used as a political consensus (rather than a managerial) tool that is useful to achieve agreements on virtual objectives and, consequently only to provide votes for politicians. Moreover, particularly in the Italian Regional Government context, a lack of coordination has been observed between strategies and policies pursued by different departments, in fact, several grey or overlapping areas can be found in departmental budgets. |
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Application of Dynamic modeling to a Solvent Recovery Area at a Pharmaceutical Manufacturing Plant |
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Bruce Bickle Bernard McGarvey |
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Abstract: As with any complex system, the day to day decisions require to run a manufacturing operations systems involves the need to understand and manage the dynamics behavior associated with such systems. Without a thorough understanding of these dynamics, it is intervene and what the optimum intervention polices should be. The natural dynamics of the system play a crucial part in deciding how the management control systems should be set up. A dynamic model can be used to gain the understanding that is required to better manage operational systems. |
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Adrian Boucher |
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Abstract: The techniques of systems thinking and system dynamics are rooted in the work of Forrester et al, developed over 30 years ago at the Massachusetts Institute of Technology. Although well-established as a technique for analyzing the behaviour of complex systems in a range of academic disciplines, making system dynamics models operational until recently required the practitioner either to program a computer to solve a specific systems modelling problem, or to learn a procedural simulation language. More recently, the development of object-oriented modelling and simulation environments which run under graphics-based operating systems potentially offer more transparent approaches to modelling complexity by removing the high-level language requirement. Alongside these developments, recent policy changes in UK education in a context of tightened resource constraints, is requiring fundamental changes in the ways in which teaching and, especially, learning are undertaken. A possible solution to providing high-quality learning about complexity in dynamic systems is through adoption of the systems thinking and system dynamics paradigms, using object-oriented modelling and simulation software models which enable students to explore the behaviours of systems in a self-directed manner. One school of thought argues that developing systems thinking skills is as important a life skill as acquiring functional literacy, numeracy and computeracy, but until very recently, relatively few educators had adopted this approach to learning and developing students’ understanding. Work on this approach in pre-university education in the United States has indicated some success in inculcating cognitive skills development and metacognitive development in problem-solving. This paper will report current and future directions for research, development of a national resource bank for teaching and learning about finance in secondary schools, together with materials relevant for non-specialist undergraduate study, and for lifelong, continuing education. |
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A Management Flight Simulator for Strategy Communication and Organizational Alignment |
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David Bridgeland Dorothy Yu Mitesh Suckak |
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Abstract: Our client, BellSouth Telecommunications, is facing dramatic changing in the market place, Until recently, BellSouth, a multi- billion dollar regional telephone provider based in Atlanta, has been operating under a regulated environment in providing local land-line services. With the accelerated deregulation of the US telecommunications industry, it is now facing increased competition from long distance telephone providers, other regional providers and new players in the industry. Competition from cellular phone companies is also increasing as the quality of wireless communications continues to improve and the cost continues to decrease, In addition, new technology is making it possible for other companies with a wire to the house- cable television providers and electrical utilities- to offer local telephone access. |
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Augusto Carena Dharma Sri |
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Abstract: Large training programs, involving hundreds, and often hundreds of people in different countries, often include common basic educational layers ( e.g. general management modules) to be delivered to all the population before or besides specific training. While multimedia tools and distance learning are under experimentation, several programs still use human tutors, and the most huge of them still need to make use of a tech-to-teacher approach. In order to make this approach effective, several goals, often conflicting, have to be stimultaneously followed. This paper described how a System Dynamics model, embedded in what is known as a learning laboratory- although with a less common protocol- had been used to support a general management course in a very large re-training project. |
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Assessing the Efficacy of Microworlds for Promoting Systems Thinking |
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Steven A. Calvaleri James A. Thompson |
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Abstract: Constructing a systems dynamics model and analyzing its behavior is a well documented practice for enriching the builder's mental model. When there is a larger audience for the use of a model- for example, to help transfer the builder's discoveries- modelers can construct an interface that allows a user to change parameters in a model. Depending on the interface design, these microworlds (or management flight stimulators) may be useful to introduce a larger audience to some of the concepts of systems dynamics and systems. Our work examines the use of such microworlds to boost system dynamics skills in the classroom and strategic thinking in commercial settings. The users report that microworlds are useful tools for helping them to grasp and master the intended concepts. |
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Linking the Film to its Environment: A System Dynamic Approach |
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Martin L. Cloutier Steven T. Sonka Randall E. Westgreen |
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Abstract: N/A |
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Using System Dynamics to Determine the Return on Investment in Engineering Information Technology |
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Vera J. Cole M.K. Hughes |
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Abstract: N/A |
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Seetha Colemann-Kemmula |
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Abstract: Systems Thinking, Archetypes and Modelling have been used to understand the dynamics of the manpower systems of a Shell Research Laboratory with the aim of assisting the management team in developing and testing policies which secure the long term health of the lab. The study starts with a search, within the boundaries of the system for sources of leverage which could create steady, non-cyclical demand for out services. Demand for our services is created by healthy business performance and the perception by the sponsors that the lab provides good value for money. Higher demand for our services increases our opportunities for renewal of R&D programmes and budgets and in turn more or better products and services. However if the starting point is poor business performance everything will decline. Either way this constitutes a reinforcing loop. |
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The Strategic Dynmaics of Counter-Insurgency Warfare |
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R. G Coyle C.J. Miller |
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Abstract: N/A |
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Adolfo Marquez Crespo Rafael Ruiz Usano Jose Manuel Framinan Torres Ricardo Zubiria de Castro |
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Abstract: The goal of this article is to build a Systems Dynamics model of a production lime under long-pull control systems, These models are presently being completely tested under different scenarios. The long- pull control systems appear to offer a higher performance than KANBAN based systems in those environments whose perfect material flow cannot be assured. |
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Systems Dynamics as a Methodology for Sustainable Coastal- Zone Management |
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Jean- Luc de Kok H.G. Wind |
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Abstract: The central aim of the multidisciplinary WOTRO research program is to develop the scientific knowledge required for the sustainable utilization of the coastal resources in tropical countries. The study area consists of the coastal zone of South - West Sulawesi, Indonesia. Most coastal- zone polices are implicitly based on the expected interaction between natural and social processes, many of which have been the subject of detailed scientific research in the past. However, a methodology suitable to apply this knowledge to support the integrated management of coastal resource is still lacking. A quantitative system approach is followed for the management component of the project to deal with the dynamic nature of the coastal- zone processes and cross-sectoral linkages. The integration of the theoretical concepts developed by the social scientist of the project in a quantitative system network is less obvious than for the natural science. The fisheries sector is one of the key elements of the coastal -zone system in which human behavior plays a role. The increasing fishing effort and introduction of destructive fishing practices have lead to severe overfishing of near coast fishing of near coast fish resources. A number of policy options are available to deal with the problem including mesh size and efforts restrictions catch quotas and the installation of marine parks. The effectiveness of these regulations depends largely on the cooperation of local fisherman. Fisherman may decide to increase the number of fishing trips above the sustainable level unless the imposed sanction exceeds the surplus profit and are effectively enforced. The perception and fishing effort of individual fishermen can be considered as the net result of the expected social and economic cost and benefits [1]. A simple bioeconomic model for the exploitation of a fish stock will be used to show how human behavior can be included in a quantitative system model in order to analyze an effort restriction policy. |
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Vassilios K. Despotakis Maria Giaoutzi |
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Abstract: Nowadays, one of the basic conceptual tools for analyzing the economic, ecological and social aspects of urban dynamics, is the paradigm of sustainable development (Giaoutzi and Nikamp 1989, 1993; Nijkamp 1990; van den Bergh, 1991). The basic tool on the other hand, which has been extensively used to analyze spatio-temporal aspects of urban dynamics, during the last decade is the Geographical Information Systems (GSI) (Burrough 1983, 1991; Dangermond 1990, Despotakis, 2991a, b). These two approaches can be linked into an integrated tool which aims to sustainability to GIS. Spatial non-dynamic dispersion and spatial diffusion models have previously been constructed by various researchers such as in the Hagerstrand model (Morril et al., 1988) gravity models (Haynes and Fotheringham, 1988; Trevor and Munford, 1991), transportation models (Wemer, 1988; Hagishima et al., 1987) etc. In all these models the development process is regarded in a non-dynamic perspective and the object propagation in space due to this development is calculated by the perspective and the object propagation in space due to this development is calculated by the deterministic models at any specific time point. Spatial flow models that used only the distance as a spatial parameter indicated strong spatial correlation of the model residual. (Baxter, 1987). Therefore, model misspecification may occur when not all spatial registrations (e.g., a 3-D local or national reference coordinate systems) are properly taken into account. On the other hand, several studies using GSI for monitoring (mainly urban) development have also been carried out in the past (Meaille and Wald, 1990; Lo and Shipman, 1990). These approaches despite the fact that they give very useful results for monitoring urban development, do not incorporate scenario generation techniques, so that the regional sustainability criteria can be applied, not only in an "external event" scenario mode but also in a "policy" and "behavioural" scenario mode. Finally pioneering studies in applying GIS to "conservation databases generation" (a concept that is close to Spatial Dynamics considerations) have also been conducted in the past (see e.g., Ahearn et al., 1900), but again the spatial dynamics have not been considered. From the above discussion follows that a missing node exists between the field of geographical information systems (GIS) modeling and the non-spatial SD modeling which will integrate both fields in a dynamic sense. In the paper the aim has been to provide this link in both a theoretical and practical sense. |
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Michael R. Deweese |
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Abstract: N/A |
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Ernst Diehl |
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Abstract: Each month a major telephone company receives 200, 000 calls from customers who have a problem with their telephone service. The company places a high emphasis on reducing the repair cost caused by high volume of complaints. Using a simulation model, the company wants to understand how more proactive maintenance can reduce the need for repair calls. The simulation model presented in this paper reveals that within a proactive maintenance we need to distinguish between at least 3 different policy levers: (1) Discover the problem before the customer notices it: (2) Do the repair with such a quality that you do not have to repair the problem twice.; (3) Make your physical plant more reliable. The stimulation model allows the company to allocate investments in each of the 3 areas and to test which investment mix fits the overall company objectives best. |
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Measuring the Effects of Systems Thinking Interventions on Mental Models |
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James K Doyle Michael J. Radzicki W. Scott Trees |
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Abstract: The concept of mental models has been central to the practice of system dynamics since its inception. When system dynamicists intervene in educational or corporate settings to help people become better systems thinkers, they typically begin by "surfacing" the participants' mental models to make assumptions explicit and to assist the model building process. And, changing mental models to make them more complete, consistent, and dynamic is typically one of the primary goals of the intervention. It is the purpose of this paper to describe the limitations of currently available techniques for eliciting, changing, and measuring changes in mental models of complex systems. In particular, when designing its techniques for studying mental models, the system dynamics community has not taken into account recent development in the fields of cognitive psychology and the procedures for collecting unbiased data from human subjects. In addition, despite the compelling need for rigorous scientific evaluation of the effectiveness of efforts to improve systems thinking (Cavaleri and Sterman, 1995; Ganter, Doyle, and Radzicki, 1995), current interventions typically fail to include rigorous follow-up measures of the changes in mental models they claim to bring about. |
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Donald R. Drew Allan D. Chasey Jesus M de la Garza Wonkyu Kim |
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Abstract: A System Dynamics Model of a State Highway management System (HMS) is developed to serve as an instrument for guiding policy-making planning, budgeting, and programming for the Virginia Department of Transportation (VDOT). The HMS consists of five subsystems and a Management Information System (MIS) to determine model parameter values. Results of the simulation runs can be obtained according to existing procedures and trends, impacts of alternative economics forecast, budget sizes, budget allocations, programming allocations between construction and maintenance, and various allocations within maintenance. |
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Competitive Advantage Through Knowledge Management: A System Dynamics Approach |
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Stephen A. Drew Peter A. Smith |
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Abstract: The knowledge-based resources that a firm controls and leverages for competitive advantages are increasingly critical to success in the marketplace. However, the nature of these assets and their dynamic systems interactions are still poorly understood. This leads to undervaluation of their competitive worth, and even worse, counter-competitive management of the assets themselves. This presentation describes a system dynamics model, and resulting flight stimulator, which relate human and technical aspects of knowledge management with customer satisfaction and market penetration. The model was based on field-work with knowledge-management practitioners. The generic flight simulator provides decision makers with a low-risk dynamic practice field, where dialog, exploration of mental models, and organizational learning concerning knowledge concerning knowledge management are catalyzed. Although the simulator is not intended for prediction, participants do gain practical insight into important strategic and operational concerns, such as how can one know if a firm is leveraging its knowledge assets to best achieve long-term customer acceptance? |
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The Mexican Petroleum 'Play In Two Acts': Taking Hold of Oil Productions Data |
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Richard C. Duncan |
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Abstract: Imagine for a moment, that you're viewing act #n of a stage play. Thus, you know the outcome of the first (n-1) acts, and the very latest status of act #n, now in progress. From this information, you'd like to predict the outcome of the present act and, if possible, the outcome of the whole play. Metaphorically speaking, that is what this paper is all about. |
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Issac Dyner Derek W. Bunn |
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Abstract: With energy markets throughout the world moving rapidly into re-structuring, liberalisation and privatisation, this presents a major challenge to traditional modelling approaches. Econometric methods have limited applicability for a new environment and optimisation techniques of "planning" are less relevant in an era of market forces. This paper presents the use of system dynamics, in a generalised way, to provide a platform for integrated energy analysis. Issues of modularity and policy evolution are important in the design of the system to facilitate its use, and reuse. In the 18 months since this work began for the Colombian Ministry of Energy, it has had to evolve to support the analysis of a number of changing perspectives and constraints. Hence the concept of a platform rather than a model has to be implemented in a coherent way if it is going to provide sustained value for on-going governmental policy support. |
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Robert L. Eberlein James H. Hines |
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Abstract: Molecules are the building blocks from which good system dynamics models are built. By the delineating and organizing molecules we are creating a new body of knowledge that will make it easier to learn modeling and provide a vehicle for focused discourse on the nature and quality of model formulation. By implementing these ideas in software we make it faster and easier for novice and experienced modelers to develop high quality system dynamics models. |
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An Approach for Understanding Learning and Decision Making in Complex Dynamic Systems |
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Fredrik Elg |
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Abstract: People often fail in controlling complex dynamic situations. Research on dynamic decision making serves the purpose of learning about how people come to think, learn and act in complex dynamic and opaque situations, where the general objective is to draw general conclusions about the nature of task and differences between people in learning and decision making. Dynamic decision making research differ from traditional decision making research by explicitly addressing issues of feedback in the task. For a definition of dynamic decision making see Brehmer (1992). Introducing concepts from systems offer new possibilities for research on dynamic decision making by presenting a framework for understanding real life systems. Systems dynamics also offer a possibility to provide transparency to complex microworlds, provides ideas on how to improve learning in and about complex dynamics systems and, finally, systems dynamics methodology can be used to ease microworld construction and improve aspects of ecological validity. The full version of this paper deal in more detail with the research on dynamic decision making and issues on the development of methods for understanding learning and decision making in and about complex dynamic systems. |
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David N. Ford J.D. Sterman |
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Abstract: Development products faster, better and cheaper than competitors has become critical to success in many markets whether the products is an office building, software package, or computer chip. This has made the performance of product development projects an increasingly important area of competitive advantage. In response to these pressures many industries have shifted from a sequential, functional, development paradigm to a concurrent, team based paradigm. Increasing concurrence and cross functional development also dramatically increases the dynamics complexity of product development (Smith and Eppinger, 1995). But the mental models used by developers and managers to evaluate, estimate and mange projects have not generally improved to include dynamic influences on performance. The resulting lack of understanding (Diehl and Sterman, 1995; Sterman 1994; Paich and Sterman, 1993) and inadequate decision heuristics (Kleinmuntz, 1993) have contributed to the frequently cited management of development projects (Womack, Jones and Roos, 1990) |
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Nathan B. Forrester |
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Abstract: Past payment of social security taxes entitles no one to future retirement benefits, either legally or financially. In 1960 the US Supreme Court ruled in Fleming v. Nestor that workers have no property rights to past contributions or anticipated benefits. Furthermore, the Trustees and Actuaries of the Social transfer system, not a fully-funded retirement system. Current benefits are funded from current social security contributions. All future benefits will be funded by future taxes or future borrowing. |
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Alan Fowler |
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Abstract: The paper argues that simulation techniques, while traditionally having been widely applied in Science and Engineering, have not yet attracted a corresponding degree of uptake in 'softer' management applications. Systems-thinking and its associated 'toolbox', stimulation, have featured prominently in the systems literature for three decades or more and the question must therefore arise as to why the take-up of such a potentially powerful aid to management-planning and decision-making has traditionally proved so sporadic and sluggish amongst business practitioners? This question along with a review of current trends illustrated by some basic examples, underscore the logic of this paper. |
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Demand Forecasting System for Suburban Railway Project Using System Dynamics and Geographical Information System |
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Atsushi Fukuda Hironori Suzuki Takahiro Kojima Shigeru Koyama |
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Abstract: N/A |
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Traffic Engineering Class for Techincal College Students Using STELLA |
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Atsushi Fukuda Yoshio Hanzawa Ryoichi Ebisawa |
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Abstract: N/A |
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Reputation in Banking and Deposit Insurance: the Dynamics of Browsing and Lending under Regulation |
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Fernando Gascon |
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Abstract: Debt contracts are cost-efficient rules designed to control opportunities behaviour on the part of managers, who are assumed to have better information than lenders. Although contracts are imperfect, in practice mangers voluntarily forbear from many kinds of opportunistic actions. They do so because the reputation for forbearance is valuable to them and their firms. A concern for reputation would help to align the interest of lenders and stockholders. Game theoretic approaches have been applied to explain formally how reputation is created and maintained in a multiperiod scenario under very restrictive initial assumptions. An S.D. approach is considered studying the dynamics and feedback effects of the borroer-lender relationship, modelling the behaviour of "Banco Herrero", a Spanish local bank when dealing with its customers and the regulator. |
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Using Groupware Technology to Facilitate Team Model Building and Learning |
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Shane Gary Chris Charyk |
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Abstract: Mental knowledge database or mental models must be captured, synthesized, and communicated to all team members in the model building process to ensure team learning and a successful modeling project. These mental knowledge database bridge model development and team learning, were interactive model building is intimately intertwined with updating mental models of the team. This paper introduces groupware technology as a tool for facilitating and enhancing this process by providing an electronic forum for team members to capture and share all relevant information. The end result is a model which is truly owned by the team and an electronic database archiving team learning over the course of the project. The electronic database archiving corporate knowledge of the issues discussed, and serves as a corporate memory when others are interested in how the team arrived at their conclusions. This paper illuminates the use of groupware in system dynamics modeling projects and discusses cases where this approach can be utilized. |
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Peter J. Genta Neville Sokol |
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Abstract: Much has been written of the use of computer simulation coupled with an interface as part of learning laboratory. Thorough the use of a fun and easy-to-access interface participants can explore the system principles at play in their own work environments in a structured workshop setting. But do these learning laboratories bring about change in the way managers make decisions? The authors will discuss the success they have had in introducing teams of managers to the concepts of system dynamics through the use if computer simulation. Over the past four years, the authors have worked with six teams within two separate oil and gas companies. These efforts have led to significant changes in the way the team members look at their business and the choices they have made to prepare themselves for the future. This cumulative experience has provided the foundation for the release of a commercially available "Microworld" which allows the user to experience the dynamics of running an oil and gas exploration and development company. This software eliminates a good portion of the up-front time and expense needed to get to a meaningful system dynamics model of a business. It is expected that incorporating this simulator in a workshop setting will provide a quick and effective method to introduce the concepts of system dynamics to an industry that is in the midst of a great deal of change. |
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Nicholas C. Georgantzas Stephen H. Brovarone |
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Abstract: The process of building a system dynamics simulation model helped competing in the HSFO (high-sulfur fuel oil) market add US $120,000 per day to its revenue, yielding a sustainable increase in profit of 62 percent. These benefits resulted from globalizing its HSFO marketing strategy while building a new internal competency, namely using system dynamics models to support strategy design. |
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Reengineering Business Process Reengineering with System Dynamics |
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Nicholas C. Georgantzas |
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Abstract: The breakthrough by Shingo to depict production as a net of processes and operations is a rather brilliant visualization with practical implications for business process reengineering (BPR). Shingo's framework not only helps unearth and negate the dysfunctional effects of Anthony's paradigm on management systems but also constitutes a powerful conceptual front end for system dynamics interventions. |
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Branko Gricic Ante Munitic |
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Abstract: Model validation is a problem that both social and natural sciences have been facing with for many years. During the last decades it became particularly pressing in social sciences due to the development of contemporary complex tools for the modelling of real social systems. The systems dynamics methodology is one of these new tools. Although it has been developed through relatively long period of time, it was rather "closed" for critical opinions especially those referring to the validation of systems dynamics approach to models validation. It takes into consideration all relevant discussions about this matter, as well as some of the procedures and criteria used so far in the system dynamics models validation. Moreover, based on the evaluation of their advantages and disadvantages, certain formal criteria are provided aiming to strengthen the credibility of these models. |
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Andreas Groessler |
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Abstract: That managing organization and mastering their environment has become a complex (sometimes chaotic) task is generally accepted. Also well known is the sufficiency of the human mind in dealing with such complexity (which has a variety of reasons, for instance the limited capacity of our short time memory, Miller 1956, or misperceptions of feedback structure, Sterman, 1989). One prominent way to let people improve their skills to act successfully under these circumstances is to be busy with computer models (Dorner 1992, pp 37-309). Through the simulation of organization and dynamic and chaotic aspects of reality. These so called Microworlds are supposed to be efficient means to improve the mastering of complex business systems (Senge 1990, pp. 313-316). |
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Designing Strategies to Achieve Sustainable Growth for Biotechnology Companies |
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M. Grossman |
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Abstract: Most new companies are faced with dual hurdle of developing their capabilities while dealing with financial constraints of not having an established revenue stream. This is especially true in the Biotechnology industry, where technological competence in research is a key success factor, but the benefits of research are often not realized for over a decade. This study uses a system dynamics framework to investigate viable growth strategies for a young biopharmaceutical research company in terms of the expansion of both its technology platform, as well as its proprietary programs. |
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Juan Hernandez Guerra |
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Abstract: This work carries out an analytic study of a two-sector model previously developed by Kampmann et al. (1993). This model explains why two capital producing sectors with initially different cyclical motions of the model will be one cyclical mode. Some new insight into the motion of the model will be shown. All the introduced assumptions and results were tested by simulations. |
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Systems Thinking and Systems Dynamics in the CC-STADUS High School Project |
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Scott Guthrie Diana Fisher |
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Abstract: This paper will be written from two perspectives, that of a science teacher teaching a year long course in system dynamics modeling, and that of a math teacher teaching the same type of course in another school. The difference in the approach will become evident in this paper. Both authors have software for designing models. |
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Roger Hall M.P. Gupta |
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Abstract: This paper presents the outline of a system dynamics corporate model of a representative manufacturing firm to be used to study the feedback dynamics leading to growth, decline and the likelihood of going bankrupt. The model comprises human resources, customers and sales, operations, budget, accounting, cash flow, finance, shares and bankruptcy propensity sectors that are heavily interactive. The driving forces of growth or decline are related to the ability of the firm's management to raise the necessary resources for working capital, capital equipment, human resources training and etc. that will ensure its long term viability. Viability is measured by Altman's 'Z' composite score based on financial ratios that has been shown to reliably indicate the likelihood of bankruptcy. The ability of the firm's management to negotiate bank loans and raise capital through shares offers is governed by the owner's, banker's and shareholder's perceptions of the viability of the firm. The 'Z' score is used as a surrogate measure of this. Trials will be run to investigate effects of management interventions on the feedback dynamics causing growth and decline. |
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Tim Haslett Charles Osborne |
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Abstract: This paper examines the impact of "local rules" on the stability and performance of a manufacturing system. The ability of systems to maintain themselves in, and move between, stable, complex and chaotic states has been widely documented. (Gleick, 1986, Waldrop, 1992). The Beer Game is an example of a social-technical system that quickly moves to and maintains itself in a chaotic state as a result of the "local rules" used by the actors. (Thomsen, Mosekilde, and Sterman 1992, Paich and Sterman, 1993). Other research indicates that such "local rules" can produce "edge of chaos" states where systems are responsive and adaptive (Langton, Taylor, Farmer, Rassmussen, 1992). |
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Tim Haslett |
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Abstract: This paper outlines the application of computer simulations in the teaching of systems thinking in two situations: in academic context in the teaching of Strategic management : in a Graduate Management program at Monsah University and in the business context in the management development programs at Carlton and United Brewing which is part of the Fosters Brewing Group. |
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John F. Hermann John L. DeOlden |
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Abstract: A simulation model for university department planning is presented that allows department chairs, faculty, or administrators to "test fly" their decision choices for key variables in the model, observe the impact of these choices, and learn how to improve systems performance, given their respective objectives. Simulator "pilots" have control over average class size and faculty teaching load, and they can observe the impact of their decisions on a number of system variables such as enrollment, percentages of classes taught by part-time faculty, and the number of full-time faculty. |
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Parameter Estimation Involved to System Dynamics Model by Multi-Objective Optimization Technique |
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Tohru Higuchi |
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Abstract: In this study we tried to estimate unknown parameters in a System Dynamics Model by optimization technique instead of trial and error. As the number of unknown parameters increases, it is difficult to estimate them by trial and error because the number of combinations of them increases rapidly. It follows that model builder are often forced to identify them subjectively. That's a weak point of Systems Dynamics Models- lack of model validation. We had tried to optimize controllable parameters on the basis of some objective functions. (2) (3) We applied this parameter optimization techniques to parameter estimation. The unknown parameters were estimated by using observational data as econometricians usually do in especially simultaneous decision models. A simplified Inventory Control Model which included two unknown parameters is used in this study. |
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Modeling the Evolution of Organizations |
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James Hines |
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Abstract: N/A |
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Competitive Dynamics: Context, Model, Outcome, and Ongoing Use |
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James H. Hines Dewey Johnson |
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Abstract: N/A |
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Jack Homer Fred Nichols |
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Abstract: Educational Testing Service, the world leader in standardized educational testing, has begun a transition from paper-and pencil testing to computer-based testing. This transition is a complex undertaking affecting the entire organization, and will require several years to complete. An integrated enterprise model has been developed to assess financial impacts of the transition and to look for better ways to manage it. Smaller side models have also been developed for exploring a few key issues individually in greater depth and with more elaboration than the large model would allow. Such a mixed "highways and byways" approach to modeling allows one to achieve a solid final product while providing useful, engaging insight along the way. |
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Evaluating the Policy of Stratospheric Ozone Protection- a System Dynamic Modeling Approach |
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Naiyi Hsiao |
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Abstract: Environmental pollution and its protection have become significant yet controversial issues on the government agenda. The environmental pollution issue occurs mainly because individuals pursuing their own private interests may collectively generate public costs. Because of this market failure, governmental intervention to reduce the harmful impacts of private actions becomes inevitable. Policy implementation tools, such as regulation, are often the core of public intervention. Through the tools, the government attempts to change the behavior of the target population in favored directions. |
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Evaluating Group Model Building in Mental Health Vocational Services |
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Steven Huz David F. Andersen George P. Richardson Roger Boothroyd |
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Abstract: In recent years, facilitated systems dynamics group model building has been used to facilitate and support decision making in management teams working to solve complex problems in both private and public sector setting. This approach is considered to be an important tool for improving the systems thinking and decision making capabilities of participating managers. The goal of these interventions is to strengthen a teams' ability to work towards developing an agreed upon course of action that will ultimately lead to resolving the problems at hand. Although there are strong indications that these approaches provide great benefit, little research has empirically explored the degree to which group system dynamic model building successfully facilitates this outcome. In New York State, a system dynamics group model building strategy is being systematically examined as an approach to promote public sector system change in mental health and vocational rehabilitation service to promote public sector system change in mental health and vocational rehabilitation service delivery systems. |
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A System View of Design Engineering Capacity: Continuous Improvement Policy Interaction |
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Anil B. Jambekar |
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Abstract: With many companies implementing continuous improvement policy to enhance all company operations, everybody is knocking on design engineering's door because 'coordinated up-front design engineering plays a central role in enhancing the performance of re-engineered or improved manufacturing process. Today many manufacturing strategies embrace the goals of reducing "time to development", "time to ship", "defects per million," and "cost" every year. The articulated associated policies create pressures on various manufacturing divisions, design engineering, and marketing and product planning to respond by continuous examinations of their operations for potential improvements or re-engineering. The consequence is production of the design work-load that some times far exceeds existing design capacity. This clearly emerges as a management problem that has been viewed in this paper through systems thinking lens. |
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Wolfgang Jonas |
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Abstract: An earlier work of the author (JONAS 1994) proposes a systems theoretic framework for design. It seems to be possible to describe design as a cyclic multilevel (society, sub-systems, companies, teams, individuals) communication process of production and consumptions with partly deterministic/ controllable and partly self-organizing areas. It was possible to verify certain hypotheses comprising elements in two adjacent levels (or better: to reproduce certain observations) by means of system dynamics (Stella II Version 2.2.2). Emergence-and-attractor-phenomena could be visualized. Theory building is continued (it seems necessary for design to avoid adopting a brand new stylish theory every decade), but without using simulation tools, at the moment. |
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Comparing Improvement Programs for Product Development and Manufacturing: Results from Field Studies |
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Andrew Jones Elizabeth Krahmer Rogelio Oliva Nelson Repenning Scott Rockart John Sterman |
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Abstract: The research described in this paper is part of a study being led by John Sterman and Nelson Repenning at the Massachusetts Institute of Technology. The overall study explores why even initially successful improvement programs often fail, and aims to help practitioners in designing sustainable improvement programs.Due to its role as part of this larger effort, the inital research has focused on exploring direct parallels with the case of Analog Devices as well as searching for additional tight interdependencies between improvement programs and a company's other organizational functions and routines. This paper focuses gives an overview of our research sites and the maor findings from the research. For a detalied description of research objectives and methods see Sterman et. al (1996) or visit or website. |
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Reactive vs. Proactive Corporate Environment Management: A System Dynamics Learning Environment |
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Luis Jordao M.P. Antunes R.F. Santos |
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Abstract: New realities are leading an increasing number of businesses to discard their old managerial perspectives and practices with regard to the natural environment. Among them, a major role is played by increasing pressure from the public, more stringent environment regulation, threatening civil and criminal enforcement measures, change in consumer preferences, new business opportunities and the development of cleaner production technologies. Tomer (1992) stresses the role of some of these factors in the stimulus to the development of new managerial approaches, specifically in the recognition of environmental management as an important functional area, that is taking place alongside traditional areas such as marketing, finance, R&D, and manufacturing. In support to this development, courses on environmental goals within their overall corporate strategy. |
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Timothy Joy |
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Abstract: Traditional education long ago stripped its students of tools of integration; indeed, integrated or interdisciplinary studies take place almost exclusively in pre-school and, later, post-graduate work-the sixteen or so years in between stretch out as a wasteland of discrete, rudimentary tasks bearing little or no connection to any other discipline of one's education or aspect of one's life. Our American methodology of keeping subjects separate had dismembered their world, served it up to them as lab reports and vocabulary lists and odd-numbered math problems and history work sheets and standardized test easily graded by Scantron machines. Sometimes there was knowledge, but rarely understanding. What it-along with other factors-produced was a rising illiteracy, a thorough sense of confusion and uselessness about education, and a weeping boredom by about third or fourth grade. |
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Analysis and Business Cycles in the U.S. Machine Tool Industry |
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Robert Kallenberg Charles H. Fine |
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Abstract: Cyclicality is well-known phenomenon in many capital goods industries. It is especially pronounced in the machine tool industry where peak-to-peak in incoming orders often exceed 100% of mean sales. While extreme cyclicality in the machine tool industry and its resulting problems are well documented (Bowen et al. 1989: Dertouzos, Lester and Solow 1989: Neary 1993), the underlying causes and the potential levers to reduce it are so far not well understood. |
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Christian E. Kampmann |
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Abstract: The method of system dynamics has relied extensively on feedback loops to explain how system structure leads to pattern of behavior. Yet, beyond simple classroom examples and as guide to intuition, the concept has never been fully developed for large-scale systems with many loops. If the theory of how feedback loops lead to behavior can be developed to the point where it can be implemented as a computer algorithm, it would be enormous help both in analyzing dynamics and explaining results. |
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The Implementation of a Large System Dynamics Model of Human Behavior |
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Michel Karsky Stephane Copin Sonia Pitrach |
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Abstract: A large model describing the dynamics the dynamics of human motivation is currently being implemented as a Learning Environment. This implementation and the corresponding use of the model by young mangers of future managers generated interest but also problems. Some of he reactions to this novel approach are described in this paper. |
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Yahia F. Khalil Michael Radzicki |
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Abstract: The Fresh Clean Air Act of 1990 stipulates that states must meet certain air quality requirements during the decade of the 1990's and beyond, and those states choosing to require the sale of Zero Emission Vehicle (essentially electric vehicles) to help meet the standards must follow the mandates put forth by the California Air Resources Board (CARB). CARB originally mandated put forth by the California Air Resource Board (CARB) CARB originally mandated that 2% of the vehicles offered for sale in California be zero emission in 1998, 5% be zero emission in 2001, and 10% be zero emission in 2003. Recently however, CARB voted to ease the mandates although 10% of the vehicles offered for sale on California must still be zero emission in 2003, automakers may decide for themselves how many ZEVs to sell in California before 2003. The mandates were relaxed because automakers convinced CARB that current ZEV technology cannot meet the needs of the mass consumer market. Massachusetts, however, has voted to maintain the "2% in 1998" mandate, regardless of what California does. |
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How Heuristic are Heuristic Decision Rules in a Dynamic Game? |
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Doa Hoon Kim Dong-Hwan Kim |
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Abstract: N/A |
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Dynamics of Networks: System Dynamics Model for Network Externality and Critical Mass |
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Dong- Hwan Kim Jae-Ho Juhn |
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Abstract: Information age comes with network: broadband networks of telecommunication and cable TV, networks of hardware and software, networks of electronic money services, networks of Internet web sites. Recently, some economists have developed a systematic approach to analyze the characteristics of networks. They introduced the concept of network externality and critical mass as building blocks for explaining the positive loop characteristics networks (Katz & Shapiro 1985: Economides 1955). However, their economic model is far from complete and dynamic. Paradoxically enough, the economic model of networks is based on the concept of equilibriums which oppress dynamic behavior of network evolution. In this paper, we developed a system dynamics model of networks focuses in the equilibrium state of networks, the SD model of networks focuses on the historical path towards the evolution of networks. |
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Use of Simulation in Management and Management Education: Speeding up the Wheel of Learning? |
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Ulli H. Koenig |
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Abstract: The shortening of product life cycle is one of the big problems to be solved in the 1990s. So a lot of energy is used to speed up the R&D-processes put more flexibility to the production line. Time is not the only key-variable of the R&D-process and the production, quality and individuality of the products are getting more and more important. These variables are not only significant for production and the R&D but also for decision making. The classical way to enhance the quality of decisions is the use of decision-support-systems (DSS), often based on artificial-intelligence (AI). Another tool to improve the effectiveness of decision making is management simulation. These tools are used to assist the decision maker with the goal of “better” results. |
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Evaluation of Neutral Networks via Generic Modelling using System Dynamics |
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Ralf Koerstein Bernd Viehweger |
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Abstract: We present an architecture of a software-system for computer based experiments with neural networks. For generating the data we use models on the basis of the theory of Systems Dynamics. Practical experience was received in experience with different neural networks and various amounts of data from the well known fishing model. The results can be useful for the evaluation of neural networks. |
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Carbon Sequestration and Emission Management: A Costal Rican Case Study |
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Elizabeth M. Krahmer Scott Rockart |
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Abstract: Global climate change has become a major concern for international and national policymakers. Costa Rica has taken a leadership role by announcing an integrated national environmental strategy, including some management of its carbon emission and sequestration. The Costa Rica Carbon Management (CRCM) model is intended to assist national policymakers understand the long-term interactions between the economy, the population and natural processes influencing the country's net carbon balance. The model was originally developed as part of the Business Applications in System Dynamics course at the Sloan School of Management MIT. An expanded MIT modeling team with the support of the center for Sustainable Development of the Universidad de Costa Rica (CIEDES) and the Central American Climate Change Program, is now working to (1) enhance the feedback relationships within the land use and energy sectors and between the economy and the remaining sectors, (2) obtain better estimates of parameters in the model, and (3) develop more realistic policy scenarios. |
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An Interactive Simulation of a Manufacturing Enterprise: Prelimimary Observations |
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Phillip Kunsberg |
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Abstract: The Advanced Research Projects Agency has sponsored a partnership between the Los Alamos National Laboratory and the University of New Mexico to develop a dynamic systems model of a manufacturing process. The main goals are to design a computer model that can be used in graduate education of students in business and engineering and that can be also served as a analytical and planning tool for managers in the US manufacturing sector. A central feature is the use of interactive simulation, where key decision-makers each control dynamically linked sub-models. The promotes a better understanding of the human dimension of complex systems and allows exploration of both teaming and competitive scenarios. At the time of this writing, we are lessons, at the least from our perspective, about the utility and the proper sphere for system dynamics modeling. |
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David Lane |
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Abstract: Generic structures are central to the aspiration of our field. System dynamics has an explicit goal: to create integrative theories (= models) of different social systems which then make it possible both to understand specific situations and to produce generalisable insights (Forrester, 1961). To a large extent progress towards this goal has involved the use of generic structure causes some confusion because of the range of model types to which this term is applied. Recently this concept has been divided into three sub-definitions, a troika of interpretations 'generic interpretations' which aims to offer a sharper statement of style, purpose and application (Lane & Smart, 199). This work leads directly to the question of confidence. How can a group have confidence that a generic structure can be of use to them? How should researchers judge whether something qualifies as a generic structure? This paper attempts to advance debate on both of these questions. The aim is to explore the extent to which we can support our current confidence in generic structure and to indicate means of improving that confidence. |
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Learning from Microworlds Environments: A Summary of the Research Issues |
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Paul Langley John Morecroft |
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Abstract: The system dynamics community is interested in the ways in which modelling and simulation tools may be used to enhance learning about complex dynamic systems. We hope that this enhanced learning will result in more robust policy making, i.e., improved decision by the policy maker, and henceforth subsequent improvements in organisational performance (as measured by revenues, profit, market share, returns on sale, returns on capital invested, improved social welfare, and so on). There is general consensus within the SD community that the process of building and simulating formal models is a valuable team learning activity for participants involved in the model building activity (Morecroft and Sterman, 1994) |
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Hong Mou Lao |
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Abstract: A well-balanced and coherent energy strategy is to safeguard the conditions for economic development. Its importance has stresses the need for effectiveness and efficient energy management at a decentralized level. With the rapid economic development in the past decade, Zhejiang province as one of the economic hot spots in China, is facing the deterioration of energy shortage problem. Although energy supply capacity was increased several times, the trend is becoming more serious. This research focuses on the impact of energy supply and consumption pattern, and important factors that affect both patterns and the relationship between then and discussing the situation of energy shortage problems in the near future. System Dynamics is used to study the complex dynamic system. A system dynamic model was built to analyze the energy shortage problem and its effects in long run. The hypothesis applied dependents to the historical evidence and related knowledge. The model built is simplified with five main sectors: Industrial production sector, Energy demand sectors, Energy supply sector, Financial resource allocation sector, and Energy conservation sector, Some alternative policies are assessed through experiment with the model including finance, energy conservation, and production management policies, etc.. |
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Erik R. Larsen Alessandro Lomi |
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Abstract: The main objective of this work is to use system dynamics to contrast two alternative visions of the organizational world. According to the first, mature organizations wield increasing power defense of their dominant positions. The implication of this view is that age and experience protect organizations from failure. According to second, old organizations became increasingly vulnerable to challenge by innovative newcomers. The implication of this view that with age and experience organizations become obsolete by progressively losing responsiveness and ability to take advantage of new market opportunities. |
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Frank Lehmann |
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Abstract: The design of modern manufacturing systems is often discusses under the viewpoint of short term effectiveness and efficiency. The demands for the production system are often mono-casual and directly derived from the goals of the production, marketing, and material management. Due to the objective setting processes of those sectors the impact of the manufacturing system to the other members of the supply chain and the long term consequences for the own firm are rarely taken into consideration. To look at production systems from the point of a system viewer includes the necessity not only to take into account the direct effects of a decision like quality, costs, etc. Also the issues to and from other parts of the system like the members of the supply chain and the long term effects should be taken into the decision process. Therefore information about the connections and the effects of these parts of the system are required. The structure of the complexity of this system make it necessary to design a simulation model, Which can show the effects from the design of modern manufacturing systems to the firm and the supply chain. The presentation discusses the core structure and the basic results of a Vansim model, which is designed to inspect these aspects of modern manufacturing systems. After that a short view is taken on the possibilities and the limits of modelling production systems in System Dynamic generally and on the problems to design a simulation model that shows short term consequences as well as long term loop-back results. |
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The Spanish Glass Container Maker. A Model of Strategic Planning in a Firm |
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Adolfo Lopez Paredes Alfonso Redondo Castan Ricardo del Olmo Martinez |
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Abstract: This paper aims a training tool which permitting different simulated situation would increase the degree of motivation and learning which could be achieved starting from a purely theoretical position. Most interactive modelling tools can be employed in gaming situations and provide a contribution to training by simulating the real world environment. Our model was developed from glass container Spanish market, and it is possible running different simulation to discover the best prices policies. Market interactions are so complex that they cannot be intuitively appreciated. We studied the market composition, the demand evolution, the demand evolution and the prices searching the market structure for the model. The simulated results for a company are: market share, quality, return, costs and best price, capacity, and inventory strategic policies. |
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James M. Lyneis Alexander L. Pugh III |
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Abstract: A necessary part of any system dynamics analysis is the estimation of parameter values which best correspond to the real system. The method of estimating parameters for a typical system dynamic model usually involves two steps (with potentially multiple iterations in the second) 1. Make an a priori estimate based on direct observation, educated guesses by managers, or similar parameters in other settings (Graham (Graham [1980] refers to this as data {at or below the level of aggregation); and 2. Revise those estimates in the process of calibrating the model to aggregate data. |
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Roderick H. MacDonold |
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Abstract: The issue of discrete versus continuous formulation of system dynamics models has provided for lively, thought provoking discussion among modeling practitioners for more than thirty years. As early as 1961, Forrester argued that models based in the philosophy that real systems re continuous. Forrester used the example that of a contract signing, normally a discrete event, and explained how contracts can be viewed as continuous when one considers that contracts go through a process of negotiations. As the expectation associated with a contract signing increase the parties begin preparation so that the contract obligation can be fulfilled (1961; p.65). Thus, a contract signing represents a continuous process. The debate of discrete versus continuous has continued into the into the 1990's with Richardson (1991) maintained that the decision to model a problem discretely or continuously depends on the conceptual distance from which one views a problem. Richardson (1991) makes a strong argument for a continuous world perspective when he writes, “Only from a more distant perspective in which events ‘behavior is a consequence of feedback structure’ arise and be perceived to yield powerful insight” (p. 346) |
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An Intelligent System Dynamics Based controller for Fuzzy Managerial System |
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Julio Macedo Rafael Ruiz Usano |
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Abstract: The target organization of a manufacturing system is the one that allows to make products whose managerial attributed (production delay, defective product rate, production cost and product variety) satisfy a target market. A fuzzy controller that generated the target organization of a manufacturing system is presented (Figure 1). This new type of controller, named organizational fuzzy controller (OFC), is an alternative tool to fuzzy expert systems. The OFC does not require membership functions, fuzzy logic and defuzzification procedures. In addition, the OFC can generate target organizations (controls) adapted to structural variation in the desired managerial attributes. |
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Jose A. D. Machuca Miguel A. Domingo Carrillo |
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Abstract: As we stated in a previous study (see Machuca et al., 1993, p. 289), we have been criticizing, since 1988, the use of black-box simulators (BBBS) and defending the use of transparent-box-business simulators (TBBS), in which the structure (for example, in the form of a casual diagram), and even the main equations of the model on which it is based, are at all times accessible to the user, who will therefore find it easier to make decisions based on previous study of the possible causes of the different behaviour of the variables, and not only on observation of the latter, which are simply effects. Our approach was based on the hypothesis that in this way the learning process and acquisition of systems would be clearly improved (Machuca, 1992). Although other authors have subsequently touched on this topic, directly or indirectly, (Eberlein(1989), Issacs and Senge(1992, p. 195), Kemeny and Kreuter (1992, p. 305), Morecroft (1992, p. 465), Peterson ( 1992, p. 117), Sy-feng and Young (1992, p. 765)), the idea has scarcely been reflected in transferal in practice to game-design. In our view, one of the most valuable tools that System Dynamics offers to the development of systems thinking was being lost (Machuca, 1992p. 176) |
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Modeling Software Processes with System Dynamics: Current Developments |
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Raymond Madachy |
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Abstract: N/A |
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Albert Madwed |
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Abstract: This Graduate Level Course for k-12 Teachers will introduce them to the General Systems Theory method of Thinking. This thought process is different from the analytical Mechanistic Method of Thinking from the Renaissance Period which produced the Industrial Revolution. The use of General Systems Theory, System Thinking and System Dynamics is aimed at bringing cohesion, meaning and interdependence to the k-12 curriculum. This process can introduce thinking, curiosity, creativity, and real world meaningful learning experiences in the classroom. The k-12 education establishment in the U.S. which is criticized for not preparing the students properly for college and the workplace could make a giant step forward by using System Thinking across the curriculum in the classroom. This is an introductory course in System Thinking and the Philosophy of the Systems View of Reality. The history of the thought process of Systems thinking and its application in the past, the present and the future is explored. Comparison with the Mechanistic View of Reality is presented. In depth studies of open, closed and feedback systems are developed and applied to social science, ecology, economics, biology, health care, physics, chemistry, mathematics, literature, government, business and etc.. Some of the graphical and software tool which have been developed for the study of systems will be uses. About 50% of the course will involve working on the application of system thinking and the computer simulation of systems. A new text was written for this course. The following twelve overheads summarizes the material and structure of this course. The text will be in draft form by the middle of 1996. |
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Do Management Flight Simualtors Really Enhance Decision Effectiveness? |
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Frank Maier Juergen Strohhecker |
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Abstract: Companies are complex and dynamic systems that have to be managed: information about the actual state of the systems has to be analyzed, decisions have to be drawn and then transformed into actions. However, due to the complexity and the dynamics of the systems, “company”, management is a very difficult venture. Therefore, tools, theories and methods are needed to make management easier and more effective. In our system dynamics community of researchers, lectures and practitioners it is a fundamental and clear paradigm that system dynamics bases modeling and simulation can enhance the understanding of complex systems and because of that it can improve decision making. |
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Frank Maier |
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Abstract: The spread of an innovation in the market is a highly dynamics process. Management science has developed a plenty of descriptive or normative methods, models and instruments to model this process. The research reaches back to 2960 with the models developed by Fourt/Woodlock, Mansfield and Bass (Fourt/Woodlock 1960; Mansfield 1961; Bass 1969). These models regard the diffusion of an innovation over time as a quasi natural process--like the spread a disease--neglecting variables that allow to control the speed of innovation diffusion through corporate decisions. However, these fundamental models have been the basis for a variety of developments in this particular field. However, only a few of them consider the variety of influencing elements of the innovation diffusion (for an overview on the different models see e.g., Manhajan/Peterson 1985; Mahajan/Muller/Bass 1990:Maier 1995a) They concentrate on one or a combination of some of the decision variables, e.g., some models have been developed to seek for the optimum pricing or advertising strategies. Some models are simple in structure, regarding only monopolistic markets and neglecting important management decision variables. Some models are little more complex, considering oligopolistic or dynamic market structures. However, management decision variables are mostly exogenous inputs into the model, no feedback between management decisions and the spread of a new product in the market, and the success of a product exists. |
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System Dynamics Approach to Marketing Modeling in the Airline Industry |
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Mahendran Maliapen Ram Ramasehan M. Quaddus |
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Abstract: The domain of strategic decision making involves very complex issues with action-reaction relationships. In reality, there are system dynamics -based stimulation tools that help business managers understand t he fundamental processes of their businesses. In this research paper, we have studied the strategic market in the passenger airline industry for an international city pair between Perth and Singapore. Based on the study of major players on this route sector, we have attempted to model all the significant market elements and forces that demonstrate their explicit and implicit behaviours. The model developed in "iThink", a system dynamics-based stimulation software, provides an interactive capability to the business manager for the exploration of alternative scenarios so that the decision maker can understand how the pricing or competitive positioning activities of other players affect the market leader and vice-versa. |