System Dynamics Introduction

System Dynamics Understanding system behavior by identifying system structure Dennis T. Beng Hui, De La Salle University-Manila

Some Phrases to Ponder.. „

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Experience is an expensive school – Benjamin Franklin Experience is something you get after you need it – anon

Dennis T. Beng Hui, De La Salle University-Manila

What is a System?

A collection of parts organized for a purpose. Dennis T. Beng Hui, De La Salle University-Manila

Why does a System Fail? „ „

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It fails to achieve its purpose. The parts are poorly designed or poorly connected. It is knocked off course because of external shock. It is inherently incapable of meeting its purpose or it attempts to adjust to changes. Its policies are badly designed. Dennis T. Beng Hui, De La Salle University-Manila

Linear Thinking of Events Information

Action

Dennis T. Beng Hui, De La Salle University-Manila

Consequences

Dynamic Behavior of a System Delay in State

Information Consequences

Delay in Knowledge Delay choice Action

Dennis T. Beng Hui, De La Salle University-Manila

Critical Elements in a Dynamic Behavior Delay - time lags or reaction time of the decision with respect to its effect on the system „ Amplification - when an action turned out to be more forceful than what it was intended „

Dennis T. Beng Hui, De La Salle University-Manila

History of SD „

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System Dynamics was originally developed in the 1950's and 1960's at MIT by Jay Forrester An Electrical Engineer who invented the random-access magnetic core memory in digital computers. Applied his background in computer sciences and engineering to the development of computer modeling and analysis of social systems. The SD methodology was based on ideas of feedback, such as encountered in electrical and mechanical control systems. Dennis T. Beng Hui, De La Salle University-Manila

History of SD „

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He was also the founder of MIT System Dynamics group. He directed the System Dynamics Program in the Sloan School until 1989 SD was developed to evaluate how alternative policies affect growth, stability, fluctuation, and changing behavior in corporations, cities, and countries. http://www.sis.pitt.edu/~mbsclass/hall_of_fame/forres.htm Dennis T. Beng Hui, De La Salle University-Manila

What is System Dynamics „

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It is the investigation of informationfeedback characteristics of managed systems. The use of models for the design of improved organizational form and guiding policy. - JayDennis Forrester (Founder of SD) T. Beng Hui, De La Salle University-Manila

What is System Dynamics (SD)? „

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Deals with the time-dependent behavior of managed systems. Aims to describe the system and understand it. (Focuses on patterns of behavior not on events). Apply qualitative and quantitative models on how information feedback govern its behavior. Designing robust information feedback structures and control policies through simulation and optimization. Dennis T. Beng Hui, De La Salle University-Manila

SD Approach by R.G. Coyle „ „

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Problem recognition Problem understanding and system description Qualitative analysis Simulation modeling and testing Policy design and testing Dennis T. Beng Hui, De La Salle University-Manila

SD Approach by Richardson and Pugh „ „ „ „ „ „ „

Problem identification and definition System conceptualization Model formulation Analysis of model behavior Model evaluation Policy analysis Model use or implementation Dennis T. Beng Hui, De La Salle University-Manila

Characteristics of a Messy Problems (Or why are problems messy?) „ „

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Dynamic – “all is change” Tightly coupled – “you can’t do just one thing” Governed by feedback – “our decisions alter the state of the world” Nonlinear – “effects are rarely proportional” History-dependent – “you cannot unscramble you eggs” Dennis T. Beng Hui, De La Salle University-Manila

Characteristics of a Messy Problems (Or why are problems messy) „

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Self organizing – “dynamics arise from internal structure” Adaptive – “people change over time” Counterintuitive – “too focused on symptoms of difficulty rather than the underlying cause” Policy resistant – “many obvious solutions fail or worsen the situation” Characterized by trade-off – “high leverage policies cause worst to better behavior, while low leverage policies result to temporary improvement before getting worse” Dennis T. Beng Hui, De La Salle University-Manila

Elements of a Dynamic Problem „

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Dynamic behavior of important variables – identify and graph those variables in the system that are the symptoms of the problems we wish to study. Time horizon – period of time over which the problem plays itself out. Dennis T. Beng Hui, De La Salle University-Manila

Elements of a Dynamic Problem „

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The reference behavior mode – patterns over time that will be referred to again and again. Thinking in terms of graphs over time – looking for long-term dynamic consequences. Use graphs to describe, define, and analyze a problem. Dennis T. Beng Hui, De La Salle University-Manila

Example of a problem statement „

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There is a an exponential growth of people in Metro Manila from 1900 – 2000 which can lead to urban decay. There is a recurring pattern on the occurrence of Dengue Fever among young children (1 to 10 years old) in Tondo between 1990 to 2000 which led to child deaths. Dennis T. Beng Hui, De La Salle University-Manila

Barriers to Learning „ „ „ „

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Dynamic complexity Limited information Confounding variables and ambiguity Bounded rationality and the misperceptions of feedback Flawed cognitive map Erroneous inferences about dynamics Unjustified reasoning (judgmental errors and bias) Defensive routines and interpersonal impediments to to learning Implementation failure Dennis T. Beng Hui, De La Salle University-Manila

Watson Card Puzzle You are shown 4 cards. Each card has a letter on one side and a number on the other side. What is the smallest number of cards you should turn over to test the rule that cards with vowels on one side have even numbers on the reverse? Which are they? Dennis T. Beng Hui, De La Salle University-Manila

Watson Card Puzzle

E K 4 7 Dennis T. Beng Hui, De La Salle University-Manila

Questions „ „ „

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What are the important symptom variables? What is the time horizon of your problem? What reference behavior mode you expect to see? (What is, what should, what you think is, what could) What are the long term dynamic consequences of the problem?

Dennis T. Beng Hui, De La Salle University-Manila

Group work Identify the problem by answering its 4 elements. „Construction of government projects. „Population of the Philippines. „Traffic congestion in Edsa. „Garbage collection in Baclaran market. „Corruption in the government. Dennis T. Beng Hui, De La Salle University-Manila

Group work Identify the problem by answering its 4 elements. „Dieting „Addiction „Population of the World „Use of Credit Card „Salary/Wage Increase Dennis T. Beng Hui, De La Salle University-Manila

Individual Work „ „ „ „

Electricity Cum GPA National Population Imported product

Dennis T. Beng Hui, De La Salle University-Manila