System dynamics is one approach to model and simulate the dynamics of complex operational systems such as population, ecological and economic systems, which usually interact strongly with each other. In the system dynamical approach, the purpose is to build model that imitates the real feedback structure of the system and captures the characteristic behavior of a system, such as, oscillation, information delays, and stability. The basic building blocks, stocks and flows, are used to describe the system feedback loops which create the nonlinearity found so frequently in every day problems.
Operational systems containing both high hierarchy entities, such as, budget cuts or company culture and lower hierarchy entities, such as, production inventories and supply lines are difficult to analyze and design – the scope, dynamics, nonlinearities, time dependencies and complexity limit the available theoretical tools. In many cases modeling and simulation are the only viable tools that can be used to analyze the behavior.
Systems Dynamics was founded in the early 1960s by Jay W. Forrester of the MIT Sloan School of Management with the establishment of the MIT System Dynamics Group. At that time, he began applying what he had learned about systems during his work in electrical engineering to everyday kinds of systems.
We build dynamic models for operational systems to help decision makers in the decision making process by given background information of the affect of decisions. Simple non calibrated models give insight and understanding to top management whereas complex calibrated models are used for optimization and design of actual systems.
- Jean-Peter Ylén
- Vesa Hölttä
- Alex Mattsson