Principles of Systems Dynamics Modeling and Analysis Pål I. Davidsen Department of Geography, University of Bergen, N-5020 Bergen, fax tel Pål I. Davidsen Department of Geography, University of Bergen, N-5020 Bergen, fax tel

Knowledge elicitation Problem identification Problem solving Management Knowledge dissemination Knowledge dissemination System Dynamics Backlog Backlog Management

University of Bergen HIA, NTNU, BI University of Bergen HIA, NTNU, BI L.B.S., L.S.E., Leeds & Portsmouth Scranton & Sunderland L.B.S., L.S.E., Leeds & Portsmouth Scranton & Sunderland Istanbul Mannheim & Stuttgart Cottbus & Mainz Mannheim & Stuttgart Cottbus & Mainz Bologna, Bocconi Carla Cattaneo & Palermo Bologna, Bocconi Carla Cattaneo & Palermo Sevilla & Pamplona Sevilla & Pamplona Lisboa & Algarve Lisboa & Algarve Lugano Utrecht

Structure Events Behavior

Structure (underlying causes) Structure (underlying causes) Events (symptoms) Events (symptoms) Behavior (dynamics) Behavior (dynamics)

Structure (underlying causes) Structure (underlying causes) Events (symptoms) Events (symptoms) Behavior (dynamics) Behavior (dynamics) Decision Making

Structure (underlying causes) Structure (underlying causes) Events (symptoms) Events (symptoms) Behavior (dynamics) Behavior (dynamics) Decision Making Policy Design

Structure (underlying causes) Structure (underlying causes) Events (symptoms) Events (symptoms) Behavior (dynamics) Behavior (dynamics) Policy Design

Structure Behavior Policy Design

Structure Behavior Policy Design

Structure Behavior Policy Design Structure Behavior Policy Design

Structure Behavior Policy Design Structure Behavior Policy Design Structure Behavior Policy Design

Structure Behavior Policy Design Structure Behavior Policy Design Structure Behavior Policy Design Strategy Development

Point of Departure: Problem behavior Point of Departure: Problem behavior

t

t Identify: Underlying Problem Structure Identify: Underlying Problem Structure

t

Identify: New Solution Structure Identify: New Solution Structure t

t

t Goal: Desired behavior

t t

t t New Solution Structure New Solution Structure Underlying Problem Structure Underlying Problem Structure Desired behavior Problem behavior Hypothesis Development & Testing

Strategy Development => System dynamics a problem-oriented multidisciplinary approach => System dynamics a problem-oriented multidisciplinary approach

t Underlying Problem Structure Underlying Problem Structure Problem behavior The model should generate the original behavior for the right reasons

t New Solution Structure New Solution Structure Desired behavior => The model will generate the desired behavior for the right reasons

t The model should explain not “just” predict t

t t The model must constitute a causal feedback theory

Strategy Development Behavior Structure

Behavior Structure

Behavior Structure

Behavior Structure

Behavior Structure

Behavior System Dynamics: Identify, understand, and utilize the relationship:

Structure Behavior System Dynamics: Identify, understand, and utilize the relationship: in complex, dynamic systems

S S D D Complexity Simplicity

S S D D Realism Abstraction

Realism Abstraction It is better to find …

than … a satisfying solution to a problem that exists … … a satisfying solution to a problem that exists … … an optimal solution to a non-existing problem … an optimal solution to a non-existing problem

Challenge: potential shifts in Domin. structure Domin. structure Challenge: potential shifts in Domin. structure Domin. structure tt Behavior

Maintaining Realism

We must not only model explicitly “the plumbing of the system”

Make observations Form expectations Establish attitudes Act on incentives (decide) We need to describe how we;

Actual Observed Confirmed Projected Desired Expected magnitudes We need to differentiate between;

Petroleum Exploration PerceivedProductivity ReportedProductivity EstimatedProductivity ActualProductivity Exploration Efforts DesiredDiscoveries EstimatedDiscoveries IdealDiscoveries

Petroleum Exploration PerceivedProductivity Nominal Productivity Productivity ReportedProductivity EstimatedProductivity ActualProductivity DesiredProductivity ProductivityIncentives Exploration Efforts DesiredDiscoveries EstimatedDiscoveries IdealDiscoveries

Petroleum Exploration PerceivedProductivity Nominal Productivity Productivity ReportedProductivity EstimatedProductivity ActualProductivity DesiredProductivity ProductivityIncentives Exploration Efforts DesiredDiscoveries EstimatedDiscoveries IdealDiscoveries

Structure Behavior System Dynamics: Identify, understand, and utilize the relationship: in complex, dynamic systems

Complexity Accumulation Feedback Non-linearity

Complexity a synergy of Complexity a synergy of Feedbacks Non-linearities Accumulations ≡ Latencies / Delays Accumulations ≡ Latencies / Delays

Accumulations ≡ Latencies/ Delays Accumulations ≡ Latencies/ Delays Complexity … the origin of dynamics

Instantaneous causality Causality playing out over time

0 t 01 t 01 In a causality that spans time nothing happens instantaneously In a causality that spans time nothing happens instantaneously

0 t 01 t 01 Effects unfold over time Effects unfold over time 90 0

Accumulations distribute and form the effects of a change across a system (in space) over time

Inventory Production Rate Shipment Rate A first order accumulation process (building up distance)

Manpower Inventory Hiring & Training Rate Production Rate Shipment Rate Attrition Rate A second order accumulation process (building up speed)

Manpower Inventory Trainers Hiring & Training Rate Production Rate Shipment Rate Attrition Rate Training Cap. Building Rate Training Cap. Decay Rate A third order accumulation process (building up accell.)

Manpower Inventory Trainers Hiring & Training Rate Production Rate Shipment Rate Attrition Rate Training Cap. Building Rate Training Cap. Decay Rate

Manpower Inventory Trainers Hiring & Training Rate Production Rate Shipment Rate Attrition Rate Training Cap. Building Rate Training Cap. Decay Rate

Manpower Inventory Trainers Hiring & Training Rate Production Rate Shipment Rate Attrition Rate Training Cap. Building Rate Training Cap. Decay Rate

Manpower Inventory Trainers Hiring & Training Rate Production Rate Shipment Rate Attrition Rate Training Cap. Building Rate Training Cap. Decay Rate

Manpower Inventory Trainers Hiring & Training Rate Production Rate Shipment Rate Attrition Rate Training Cap. Building Rate Training Cap. Decay Rate

Multiple accumulations introduce intransparency that leads us to focus on short-term problems while ignoring long-term benefits

Multiple accumulations introduce intransparency that leads us to focus on short-term benefits while ignoring long-term problems

Gain Additional Complexity Reputation Loss

Gain Indicated Rep. > Reputation Reputation Loss Indicated Reputation Indicated Reputation Time to Gain Reputation Time to Gain Reputation

Gain Indicated Rep. < Reputation Reputation Loss Indicated Reputation Indicated Reputation Time to Loose Reputation Time to Loose Reputation

Gain Additional Complexity Reputation Loss Indicated Reputation Indicated Reputation Time to Loose Reputation Time to Loose Reputation Time to Gain Reputation Time to Gain Reputation

Latencies and the time over which the effects play out are often misperceived more often underestimated than overestimated

Stocks + Flows

Backlog Order Placement Rate Order Execution Rate

Inventory Production Rate Delivery Rate

Cash Revenue Rate Payment Rate

Personnel Hiring Rate Attrition Rate

Capital Acquisition Rate Discard Rate

Payment Rate Depreciation Rate Book Value Capital Acquisition Rate Discard Rate

Payment Rate Depreciation Rate Book Value Capital Acquisition Rate Discard Rate Price

Payment Rate Depreciation Rate Book Value Capital Acquisition Rate Discard Rate Price Annual Fraction Depreciated Annual Fraction Discarded

Identified Reserves Discovery Rate Production Rate

Depreciation Rate Book Value Identified Reserves Discovery Rate Production Rate Exploration Expenditures

Depreciation Rate Book Value Identified Reserves Discovery Rate Production Rate Exploration Expenditures Cum Production Recovery Technology Total Recoverable Resource Remaining (CumulativeProduction + IdentifiedReserves)*FractionRecoverable - CumulativeProduction)

Depreciation Rate Book Value Identified Reserves Discovery Rate Production Rate Unit Exploration Expenditures Exploration Expenditures Total Recoverable Resource Remaining Recovery Technology Cum Production

Depreciation Rate Book Value Identified Reserves Discovery Rate Production Rate Unit Exploration Expenditures Exploration Expenditures Total Recoverable Resource Remaining Recovery Technology Cum Production

No stocks, no state

No flows, no dynamics

Stocks act as buffers they de-couple flows

Stocks integrate flows

Debt Import RateExport Rate Stocks integrate flows

Debt Import RateExport Rate

Debt - Export Rate Net Import Rate = Import Rate The Debt Model

Debt 0 t 01 t 01 - Export Rate Import Rate

Debt 0 t 01 t 01 - Export Rate Import Rate

Debt 0 t 01 t 01 Stocks constitute delays - Export Rate Import Rate

Just like driving a car Capital Personnel Shipments Inventory Exp. Demand Attrition Recruitment Acquisitions Phase-outs Production Adj. Exp. Demand Market Demand

Complexity Dynamics Delay Feedback Non-linearity

Delay Distributes the effect of our efforts through the system over time

Price - + DemandSupply Perceived Shortages + - Delay distributes the effect of our efforts through the system over time Delay distributes the effect of our efforts through the system over time

Price - + DemandSupply Perceived Shortages + - Delay obscures the relationship between cause and effect Delay obscures the relationship between cause and effect

Price - + DemandSupply Perceived Shortages + - => It is difficult to … => It is difficult to …

Price + + Perceived Shortages Demand - Supply identify problems (what are their causes) -

Price + + Perceived Shortages Demand - Supply take effective actions (what do they cause) -

Price Perceived Shortages Demand - Supply … and feedback... + … does not make it less difficult

Price Perceived Shortages Demand - Supply A note on... + … econometrics

Price Perceived Shortages Demand - Supply A note on... + … the significance of the time horizon

Management from a System Dynamics perspective ensure short- and long-term sustainability

Complexity Feedback Non-linearity Accumulation

Accumulations ≡ Latencies/ Delays Accumulations ≡ Latencies/ Delays Complexity From the origin of dynamics to…

Feedback Complexity Accumulations ≡ Latency/ Delay Accumulations ≡ Latency/ Delay … circular causality

Circular causality lead us to reason in circles: Cause becomes effect and effect becomes cause

This is why we need to say Some change in B leads to a change in A … which over a period of time leads to a change in B A B

Price Perceived Shortages Demand - Supply Speculative Demand + + Speculative Supply

Price Perceived Shortages Demand - Supply + Speculative Demand + + Speculative Supply

Price - + Perceived Shortages DemandSupply + Speculative Demand + + Speculative Supply

More Feedback (FblExmpls)FblExmpls

Management from a System Dynamics perspective

Management from a System Dynamics perspective Strengthen favorable loops

Management from a System Dynamics perspective Strengthen favorable loops Weaken unfavorable loops

NOTE: What loops are favorable or unfavorable varies from one point in time to the next because of …

Price Perceived Shortages Demand - Supply + Speculative Demand + + Speculative Supply

Challenge: What loops are favorable or unfavorable varies from one point in time to the next because …

Effects take time Effects feed back... not only do

Effects take time Effects feed back Effects also synergize

Feedbacks Non-linearities Complexity a composite of Complexity a composite of Accumulations ≡ Latency/ Delay Accumulations ≡ Latency/ Delay

Complexity Feedback Non-linearity Accumulation

Non-linearity causes the response to a change in a variable to be conditioned by the state of the system… Non-linearity causes the response to a change in a variable to be conditioned by the state of the system…

Efficiency in Exploration Fract. Total Resource Remaining Undiscovered 0...(1) by the value of the variable itself..

Nominal Rework Effort Needed Per Error % of Job Completed D e s i g n C o d i n g 0 0

% Active Errors % of Job Completed D e s i g n C o d i n g 0 0

% Active Error Retirement Fraction % of Job Completed D e s i g n C o d i n g 0 0

Efficiency in Exploration Fract. Total Resource Remaining Undiscovered 0

Non-linearity causes the response to a change in a variable to be conditioned by the state of the system… Non-linearity causes the response to a change in a variable to be conditioned by the state of the system…

Z = X * Y or X / Y rather than X + Y or X - Y Z = X * Y or X / Y rather than X + Y or X - Y X Y.. (2) by the value of other variables.. Subsystem ISubsystem II

Yield = Investments * Productivity = Investments * Productivity From Technology * Effect Of Exploration On Productivity Yield = Investments * Productivity = Investments * Productivity From Technology * Effect Of Exploration On Productivity Technology Exploration Finance Investments Productivity Eff. Of Exploration On Productivity

To be continued...

Cumulative Identified Resource Additions to Total Resource (TR) Undiscovered Resource (UR)

Cumulative Identified Resource Additions to Technically Undiscoverable Resource Remaining TechnicallyDiscoverable Resource Remaining (TDRR) UndiscoveredResource(UR) Total Resource (TR)

Cumulative Identified Resource Additions to Technically Undiscoverable Resource Remaining TechnicallyDiscoverable Resource Remaining (TDRR) UndiscoveredResource(UR) Total Resource (TR)TechnologicalProgress

Cumulative Identified Resource Additions to Technically Undiscoverable Resource Remaining TechnicallyDiscoverable Resource Remaining (TDRR) UndiscoveredResource(UR) Total Resource (TR)TechnologicalProgress ExplorationProgress

Cumulative Identified Resource Additions to Technically Undiscoverable Resource Remaining TechnicallyDiscoverable Resource Remaining (TDRR) Total Resource (TR)UndiscoveredResource(UR) Productivity From Technology = Techn. Discoverable Resource Remaining (TDRR) / Undiscovered Resource (UR)

Cumulative Identified Resource Additions to Technically Undiscoverable Resource Remaining TechnicallyDiscoverable Resource Remaining (TDRR) UndiscoveredResource(UR) Total Resource (TR) Productivity From Technology = Techn. Discoverable Resource Remaining (TDRR) / Undiscovered Resource (UR) TechnologicalProgress

Cumulative Identified Resource Additions to Technically Undiscoverable Resource Remaining TechnicallyDiscoverable Resource Remaining (TDRR) UndiscoveredResource(UR) Total Resource (TR) Effect of Exploration On Productivity = Undiscovered Resource (UR) / Total Resource (TR)

Cumulative Identified Resource Additions to Technically Undiscoverable Resource Remaining TechnicallyDiscoverable Resource Remaining (TDRR) UndiscoveredResource(UR) Total Resource (TR)ExplorationProgress Effect of Exploration On Productivity = Undiscovered Resource (UR) / Total Resource (TR)

Yield = Investments * Productivity = Investments * Productivity From Technology * Effect Of Exploration On Productivity Yield = Investments * Productivity = Investments * Productivity From Technology * Effect Of Exploration On Productivity Technology Exploration Finance Investments Productivity Eff. Of Exploration On Productivity

Yield = Investments * Productivity = Investments * Techn. Discoverable Resource Remaining (TDRR) / Undiscovered Resource (UR) * Undiscovered Resource (UR) / Total Resource (TR) Yield = Investments * Productivity = Investments * Techn. Discoverable Resource Remaining (TDRR) / Undiscovered Resource (UR) * Undiscovered Resource (UR) / Total Resource (TR) Cumulative Identified Resource Additions to Technically Undiscoverable Resource Remaining TechnicallyDiscoverable Resource Remaining (TDRR) Total Resource (TR)

Yield = Investments * Productivity = Investments * Techn. Discoverable Resource Remaining (TDRR) / Total Resource (TR) Yield = Investments * Productivity = Investments * Techn. Discoverable Resource Remaining (TDRR) / Total Resource (TR) TechnicallyDiscoverable Resource Remaining (TDRR) Total Resource (TR)

TechnicallyDiscoverable Resource Remaining (TDRR) Total Resource (TR)TechnologicalProgress ExplorationProgress

…so that non-linearity causes effects to become blended …so that non-linearity causes effects to become blended

=> Non-linearity makes it difficult to establish experience with respect to underlying causes (diagnosis) and leverage points, doses and timing (treatment) Non-linearity makes it difficult to establish experience with respect to underlying causes (diagnosis) and leverage points, doses and timing (treatment)

Demand - Investm. in Prod. % of Investments in Production Investm. in R&D Qlt + + R&D Efficiency Price Price/QLTSales Revenue Production Capacity Production Rate Inventory Level

Demand - Investm. in Prod. % of Investments in Production Investm. in R&D Qlt + + R&D Efficiency Price Price/QLTSales Revenue Production Capacity Production Rate Inventory Level

Demand - Investm. in Prod. % of Investments in Production Investm. in R&D Qlt + + R&D Efficiency Price Price/QLTSales Revenue Production Capacity Production Rate Inventory Level

Demand - Investm. in Prod. % of Investments in Production Investm. in R&D Qlt + + R&D Efficiency Price Price/QLTSales Revenue Production Capacity Production Rate Inventory Level

Demand - Investm. in Prod. % of Investments in Production Investm. in R&D Qlt + + R&D Efficiency Price Price/QLTSales Revenue Production Capacity Production Rate Inventory Level

Demand - Investm. in Prod. % of Investments in Production Investm. in R&D Qlt + + R&D Efficiency Price Price/QLTSales Revenue Production Capacity Production Rate Inventory Level

Demand - Investm. in Prod. % of Investments in Production Investm. in R&D Qlt + + R&D Efficiency Price Price/QLTSales Revenue Production Capacity Production Rate Inventory Level

Demand - Investm. in Prod. % of Investments in Production Investm. in R&D Qlt + + R&D Efficiency Price Price/QLTSales Revenue Production Capacity Production Rate Inventory Level

Demand - Investm. in Prod. % of Investments in Production Investm. in R&D Qlt + + R&D Efficiency Price Price/QLTSales Revenue Production Capacity Production Rate Inventory Level

Demand - Investm. in Prod. % of Investments in Production Investm. in R&D Qlt + + R&D Efficiency Price Price/QLTSales Revenue Production Capacity Production Rate Inventory Level

Demand - Investm. in Prod. % of Investments in Production Investm. in R&D Qlt + + R&D Efficiency Price Price/QLTSales Revenue Production Capacity Production Rate Inventory Level

Non-linearity makes it difficult to utilize formal analysis Non-linearity makes it difficult to utilize formal analysis

S S D D Realism Abstraction

It is better to be almost right (ca. 7.5) … It is better to be almost right (ca. 7.5) … …precisely wrong ( ) …precisely wrong ( ) than

Non-linearity => Endogenous shifts in structural dominance Non-linearity => Endogenous shifts in structural dominance

Interdisciplinary analogies Reality checks Defining loops that serve a purpose

Population

Birth Rate

Death Rate Population

RGF Reference Growth Fraction Birth RateDeath Rate Population

RGF Reference Growth Fraction Birth RateDeath Rate RGF*P Population

RGF Reference Growth Fraction Birth RateDeath Rate RGF*P Population

RGF Reference Growth Fraction Birth RateDeath Rate C RGF*P Carrying Capacity Population

RGF Reference Growth Fraction Birth RateDeath Rate P/C Stress C RGF*P Carrying Capacity Population

RGF Reference Growth Fraction Birth RateDeath Rate P/C Stress C RGF*S*PRGF*P Carrying Capacity Population

RGF Reference Growth Fraction Birth RateDeath Rate P/C Stress C RGF*P*P/CRGF*P Carrying Capacity Population

RGF Reference Growth Fraction Birth RateDeath Rate RGF*P 2 /CRGF*P Population

RGF Reference Growth Fraction Birth RateDeath Rate RGF*P + - Population RGF*P 2 /C

Months Population +

Months + Population

Months Infectious + Population

Months Susceptible Infectious + Population

Infectious c * i * S/N * I Susceptible Net Recruitment Rate - + Prob Of Mtg. Susc.Hot Contacts Per Week S/N c * I Contact Frequency c Infectivity i

RGF Reference Growth Fraction Population Birth RateDeath Rate P/C Stress C RGF*P*SRGF*P Carrying Capacity - + -

c*i Reference Growth Fraction Infectious Potential Recruitment Rate c * i * I Note: If the entire population was susceptible, then all meetings with an infections is potentially a recruitment: - + -

c*i Reference Growth Fraction Infectious Potential Recruitment Rate I/N Growth Resistance N c * i * I Total Population Note: No more than the total population N may become infectious i.e. the total population is the carrying capacity - + -

c*i Reference Growth Fraction Infectious Potential Recruitment RateFailed Recruitment Rate I/N Growth Resistance N c*i*I*GRc * i * I Total Population Note: The fraction I/N of the population has already been infected and a meeting between such a person and another infected does NOT contribute to recruitment - + -

c*i Reference Growth Fraction Infectious Potential Recruitment RateFailed Recruitment Rate c*i*I*I/Nc * i * I N - + -

c*i Reference Growth Fraction Infectious Potential Recruitment RateFailed Recruitment Rate c * i * I Recruitment under the assumption that the total population is susceptible c*i*I*I/N - +

c*i Reference Growth Fraction Infectious Potential Recruitment RateFailed Recruitment Rate c * i * I Recruitment under the assumption that the total population is susceptible Recruitment failing because a fraction (I/N) of the total population is not susceptible c*i*I*I/N - +

c*i Reference Growth Fraction Infectious Potential Recruitment RateFailed Recruitment Rate c*i*I 2 /Nc * i * I - +

c*i Reference Growth Fraction Infectious Potential Recruitment RateFailed Recruitment Rate c*i*I 2 /Nc * i * I Net Recruitment Rate c * i * I - c*i*I 2 /N - +

c*i Reference Growth Fraction Infectious Potential Recruitment RateFailed Recruitment Rate c*i*I 2 /Nc * i * I Net Recruitment Rate c * i * I * (1 - I/N) Recruitment succeeding because a fraction (1 - I/N) of the total population is still susceptible - +

Infectious Potential Recruitment RateFailed Recruitment Rate c*i*I 2 /Nc * i * I Net Recruitment Rate - + c * i * I * (1 - I/N)

Infectious Potential Recruitment RateFailed Recruitment Rate c*i*I 2 /Nc * i * I Net Recruitment Rate - + c * i * I * (1 - I/N)

Infectious c*i*I 2 /N Net Recruitment Rate c * i * I - + c * i * I * (1 - I/N)

Infectious c*i*I 2 /N c * i * I Net Recruitment Rate - + c * i * I * (1 - I/N)

Infectious c * i * I - c*i*I 2 /N Net Recruitment Rate

Infectious c * i * (1 - I/N) * I Net Recruitment Rate

Infectious c * i * (1 - I/N) * I Net Recruitment Rate

Infectious Susceptible c * i * (1 – (N-S)/N) * I Net Recruitment Rate - +

Infectious Susceptible c * i * ((N – (N-S))/N) * I Net Recruitment Rate - +

Infectious c * i * S/N * I Susceptible Net Recruitment Rate - + Infectious c * i * S/N * I Susceptible Net Recruitment Rate - + Prob Of Mtg. Susc.Hot Contacts Per Week S/N c * I Contact Frequency c Infectivity i

Infectious c * i * I/N * S Susceptible Net Recruitment Rate - + Infectious c * i * I/N * S Susceptible Net Recruitment Rate - + Prob Of Mtg. Susc.Hot Contacts Per Week S/N c * I Contact Frequency c Infectivity i

Infectious Net Recruitment Rate c * i * I *S/N Susceptible Infectious Potential Recruitment RateFailed Recruitment Rate (c * i) * I(c*i*I/N)*I NOTE: Although the models are equivalent, the positive and negative loops in these two models are not the same! They ”tell the story” in two very different ways - +

Months Susceptible Infectious +

- NetRecruitmentRate Infectious Susceptible NetRecruitmentRate Susceptible + Summary

Endogenous Shifts in Structural Significance Diffusion and Depletion Processes Masking a negative loop by a positive loop Endogenous Shifts in Structural Significance Diffusion and Depletion Processes Masking a negative loop by a positive loop

Exploration Rate Exploration Potential - Exploration Rate

Expl. / Exploit. Pot Exploration Rate - Exploration Potential Exploration Rate + Expl. / Exploit. Pot Exploration Potential

Exploitation Rate - Exploration Potential Exploration Rate + - Exploitation Rate Exploration Potential Exploration Rate Expl. / Exploit. Pot

- Exploration Potential Exploration Rate + - Exploitation Rate Exploration Rate Exploited Exploitation Rate Expl. / Exploit. Pot Exploited Exploration Potential

Exploited - Exploration Potential Exploration Rate + - Exploitation Rate Exploration Rate Exploitation Rate Expl. / Exploit. Pot Exploited Exploration Potential

- Exploration Rate + - Exploitation Rate Expl. / Exploit. Pot Exploited

Investments in Exploration - Exploration Potential Exploration Rate + - Exploitation Rate Expl. / Exploit. Pot Revenues Exploited

Investments in Exploration Productivity in Exploration - Exploration Potential Exploration Rate + - Exploitation Rate Expl. / Exploit. Pot Revenues Exploited

Investments in Exploration Effect of Exploration on Investment Productivity - Exploration Potential Exploration Rate + - Exploitation Rate Expl. / Exploit. Pot Revenues Exploited Productivity of Investments in Exploration

- Exploration Potential Exploration Rate + - Exploitation Rate Investments in Exploration Productivity of Investments in Exploration Investments in Exploration Technology Exploration Technology + Expl. / Exploit. Pot Effect of Exploration on Investment Productivity Revenues Exploited

Productivity of Investments in Technology Investments in Exploration Technology - Exploration Potential Exploration Rate + - Exploitation Rate Investments in Exploration Revenues Productivity of Investments in Exploration Investments in Exploration Technology Exploration Technology + Expl. / Exploit. Pot Effect of Exploration on Investment Productivity Investments in Technology Exploited Exploration Technology

Investments in Technology Productivity of Investments in Technology - Exploration Potential Exploration Rate + - Exploitation Rate Revenues Expl. / Exploit. Pot Effect of Exploration on Investment Productivity Exploited Exploration Technology

Investments in Technology Productivity of Investments in Technology - Exploration Potential Exploration Rate + Revenues Effect of Exploration on Investment Productivity Exploited Exploration Technology

Investments in Technology Productivity of Investments - Exploration Potential Exploration Rate + Revenues Effect of Exploration on Investment Productivity Exploited Exploration Technology

- Exploration Potential Exploration Rate + Exploited Exploration Technology Exploited Exploration Technology

- Exploration Potential Exploration Rate + - Exploitation Rate Investments in Exploration Productivity of Investments in Exploration Investments in Exploration Technology Exploration Technology + Expl. / Exploit. Pot Effect of Exploration on Investment Productivity Revenues Exploited

- Exploration Potential Exploration Rate + - Exploitation Rate Investments in Exploration Productivity of Investments in Exploration Investments in Exploration Technology Exploration Technology + Expl. / Exploit. Pot Effect of Exploration on Investment Productivity Revenues Exploited

- Exploration Potential Exploration Rate + - Exploitation Rate Investments in Exploration Productivity of Investments in Exploration Expl. / Exploit. Pot Effect of Exploration on Investment Productivity Revenues Exploited Exploration Technology

- Exploration Potential Exploration Rate + Exploitation Rate Investments in Exploration Productivity of Investments in Exploration Expl. / Exploit. Pot Effect of Exploration on Investment Productivity Revenues

Investments in Exploration Productivity of Investments - Exploration Potential Exploration Rate + Revenues Effect of Exploration on Investment Productivity Exploitation Rate Expl. / Exploit. Pot

- Exploration Potential Exploration Rate + Expl. / Exploit. Pot Explored / Exploit. Pot

- Undiscovered Discovery Rate + Discovered + - +

CAIR TUdRR Technically Discoverable Resource Remaining (TDRR) Total Resource (TR)TechnologicalProgress ExplorationProgress Investment and technology loop dominance Years + Undiscovered Discovered Discovery Rate +

CAIR TUdRR Technically Discoverable Resource Remaining (TDRR) Total Resource (TR)TechnologicalProgress ExplorationProgress - Undiscovered Depletion loop dominance Discovered Discovery Rate Years Undiscovered Discovered +

TUdRR Technically Discoverable Resource Remaining (TDRR) Total Resource (TR)DTP EP - Undiscovered Depletion loop dominance Discovered Discovery Rate Years Undiscovered Discovered + CAIR

TUrRR Technically Recoverable Resource Remaining (TRRR) TUdRR Technically Discoverable Resource Remaining (TDRR) Total Resource (TR)DTP EP - Undiscovered Depletion loop dominance Discovered Discovery Rate Years Undiscovered Discovered + CAIR RTP PP

TUrRR Technically Recoverable Resource Remaining (TRRR) TUdRR Technically Discoverable Resource Remaining (TDRR) Total Resource (TR)DTP EP Recovered Production Rate Years Undiscovered Discovered CAIR RTP PP + Investment and technology loop dominance

TUrRR Technically Recoverable Resource Remaining (TRRR) TUdRR Technically Discoverable Resource Remaining (TDRR) Total Resource (TR)DTP EP - Unrecovered Depletion loop dominance Recovered Production Rate Years Undiscovered Discovered CAIR RTP PP - +

Could this model be applied in the health sector ?

Patients who, techno- logically considered, cannot be treated Patients who, techno- logically considered, may be treated Alle Pasienter Technologicalprogress Progress in utilization - Untreated Shift in loop-dominance Treated Progress + Patients treated

A diffusion model

Management from a System Dynamics perspective Strengthen favorable loops Weaken unfavorable loops

What loops are favorable or unfavorable varies from one point in time to the next ! Note

Management from a System Dynamics perspective In developing robust policies, management must establish a surveillance of loop dominance

Management from a System Dynamics perspective so as to decide on which to weaken and which to strengthen at any point in time In developing robust policies, management must establish a surveillance of loop dominance

Behavior Structure

SPREAD SHEET Multimedia databases Modern Problem Statement Format:

Point of departure Source Material

Formalization Source Material SD-model

Documentation Source Material SD-model

Design and Control Source Material SD-model ILE

Source Material SD-model ILE Illustration

Source Material SD-model ILE Transparency

The Modeling Process

Problem articulation Formulation of dynamic hypothesis Formulation of simulation model Testing Policy design & evaluation

A predator prey model HLstart HL5 HL6 HLstart HL5 HL6

Peter M. Senge: The Fifth Discipline From Archetypes to Generic Structures & Behavior and back again.....

F Limits to Growth F Eroding Goals F Escalation => Success to the Sucessful F Tragedy of the Commons F Fixes that Fail F Shifting the Burden to the Intervener=> Dependency & Addiction Archetypes

Class of Challenges Problem Symptom Own solution -

Class of Solutions: Shifting the burden to an intervener Intervention Own solution - - Problem Symptom

Class I of Side Effects: Dependence Intervention Own solution Ability to solve Problem Symptom

+ Class II of Side Effects: Addiction Intervention Own solution Ability to solve - - Quality of Intervention Problem Symptom +

A Dynamic Story Problem Behavior

Backlog

Backlog Management

Backlog Backlog Management

- Backlog Adjustment Backlog Order Rate Ideal Structure Des Repair Rate Repair Rate

A Dynamic Story Additional Evidence

Backlog Backlog Management

Backlog Backlog Management

- Des Workforce Workforce Backlog Adjustment Backlog Order Rate Problem Structure Normal Repair Rate Hire Rate Des Repair Rate Repair Rate

Solution Overtime

Backlog Backlog Management

Backlog Backlog Management

Schedule Pressure Des Workforce Workforce Backlog Adjustment Backlog Effect of Over- time On Repair Rate Order Rate Long term solution - - Normal Repair Rate Hire Rate Des Repair Rate Repair Rate

Schedule Pressure Des Workforce Workforce Normal Repair Rate Backlog Adjustment Backlog Hire Rate Effect of Over- time On Repair Rate Order Rate Des Repair Rate Repair Rate Long term solution - - +

Schedule Pressure Des Workforce Workforce Backlog Adjustment Backlog Effect of Over- time On Repair Rate Order Rate Expected Over- time Trouble I: Dependence Normal Repair Rate Hire Rate Des Repair Rate Repair Rate

MTBF Schedule Pressure Des Workforce Workforce Backlog Adjustment Backlog Effect of Over- time On Repair Rate Order Rate Expected Over- time Trouble II: Addiction Normal Repair Rate Hire Rate Des Repair Rate Repair Rate

MTBF Schedule Pressure Des Workforce Workforce Backlog Adjustment Backlog Effect of Over- time On Repair Rate Order Rate Expected Over- time Trouble II: Addiction Normal Repair Rate Hire Rate Des Repair Rate Repair Rate

MTBF Complexity Schedule Pressure Des Workforce Workforce Backlog Adjustment Backlog Effect of Over- time On Repair Rate Order Rate Expected Over- time Normal Repair Rate Hire Rate Des Repair Rate Repair Rate

MTBF Neg. Feedback Schedule Pressure Des Workforce Workforce Backlog Adjustment Backlog Effect of Over- time On Repair Rate - - Order Rate Expected Over- time Normal Repair Rate Hire Rate Des Repair Rate Repair Rate

MTBF Pos. Feedback Schedule Pressure Des Workforce Workforce Backlog Adjustment Backlog Effect of Over- time On Repair Rate Order Rate Expected Over- time Normal Repair Rate Hire Rate Des Repair Rate Repair Rate

MTBF Delay Schedule Pressure Des Workforce Workforce Backlog Adjustment Backlog Effect of Over- time On Repair Rate Order Rate Expected Over- time + Normal Repair Rate Hire Rate Des Repair Rate Repair Rate

MTBF Non-linearity Schedule Pressure Des Workforce Workforce Backlog Adjustment Backlog Effect of Over- time On Repair Rate Order Rate Expected Over- time + Normal Repair Rate Hire Rate Des Repair Rate Repair Rate

Schedule pressure 1 1- o o.51.5 Overtime Graph

1 1- o.51.5 MTBF Graph ? ? Schedule pressure

MTBF Non-linearity Schedule Pressure Des Workforce Workforce Backlog Adjustment Backlog Effect of Over- time On Repair Rate Order Rate Expected Over- time + Normal Repair Rate Hire Rate Des Repair Rate Repair Rate

MTBF Schedule Pressure Des Workforce Workforce Backlog Adjustment Backlog Effect of Over- time On Repair Rate Order Rate Expected Over- time + Normal Repair Rate Hire Rate Des Repair Rate Repair Rate Uncertainty

Class of Challenges Own solution - Problem

Instance of a Challenge - Recruitment Under-/Over- Capacity

Class of Solutions: Shifting the burden to an intervener Intervention Own solution - - Problem

Instance of a Solution: Shifting the burden to the workforce - - Overtime Recruitment Under-/Over- Capacity

Class I of Side Effects: Dependence Intervention Own solution Ability to solve Problem

Instance I of a Side Effect: Dependence on Overtime Recruitment Ability/willingn. to recruit - - Overtime Under-/Over- Capacity +

Class II of Side Effects: Addiction Intervention Own solution Ability to solve - - Quality of Intervention + + Problem

Instance II of a Side Effect: Increasing load through decreased MTBF Under-/Over- Capacity Recruitment MTBF Overtime Ability/willingn. to recruit +

SPREAD SHEET Multimedia databases Modern Problem Statement Format:

Point of departure Source Material

Formalization Source Material SD-model

Documentation Source Material SD-model

Design and Control Source Material SD-model ILE

Source Material SD-model ILE Illustration

Source Material SD-model ILE Transparency

Ubehandlede Behandlede + Years Utnyttlesesløkke-dominans