Abstract
The system dynamics approach was developed by Jay Forrester from MIT during 1950s to analyze the complex behavior in administration with computer simulation in social sciences. System dynamics is a form of the systems approach as a methodology to understand the dynamic behavior of complex systems. The basis of system dynamics is to understand how system structures cause system behavior and system events. This chapter aims to develop a system dynamic model. System dynamics approach was adopted to build a bed capacity management model using a software package, Vensim.
TopSystem Dynamics
System dynamics deals with how things change over time. Almost all are interested in how the past formed the present moment and how today's actions determine the future. System dynamics is designed to model, analyze and improve socio-economic and administrative systems using a feedback perspective. Dynamic structured administrative problems are modeled by mathematical equations and using computer software. Dynamic constructions of model variables are obtained using computer simulations (Forrester, 1995; Forrester, 1962; Ford 1999; Sterman, 2000).
The main principle of system dynamics is that the ongoing accumulation of the complex behavior of organizational and social systems (human, material, financial assets, information, biological and psychological states) is also the result of balancing and empowering feedback mechanisms. (Richardson, 1999).
System dynamics is an interdisciplinary problem-solving methodology that utilizes several significant thinking skills such as dynamic thinking and cause-and-effect thinking. System dynamics is a disciplined collaborative approach that could accelerate learning by combining a multifaceted perspective that provides insight into complex and interactive issues (Richmond 2010; Soderquist & Overakker 2010; Ferencik, 2014).
System dynamics is a method that allows analysts to separate complex social, and behavioral systems into components, to visualize them by reconstructing them as a whole again, and to develop a simulation model (Tang and Vijay, 2001: 3).
Key Terms in this Chapter
System Dynamics: The basis of system dynamics is to understand how system structures cause system behavior and system events.
Decision Functions: States of the policy that determines how to convert available information in stock into a decision.
System Dynamic Language: This language consists of four components: stocks, flows, decision functions, and information flow.
Stocks: The present values of the variables that are formed by the accumulated difference between the inflow and outflow.
Information Flow: Creation, control and distribution of information is the most significant task of business management. It might be difficult to model the information properly in the business process.
Information Delay: They are usually caused by the transfer of information and the delay in the process of taking an action after the information is received. Information delays could occur in vertical hierarchical administrations.
Flow: It is defined as the increase or decrease in the unit time interval in stocks and denoted by f ( t ).
Material Delays: In this structure, the material moves forward from the beginning to the end of the pipeline without any change during a period of time, similar to a water running through a pipeline.
Material Flow: It includes stocks and flow rates of physical goods such as raw materials, inventories in the process or finished goods.
Delays: A characteristic of dynamic systems and affect both material and information flow.