The Prophet of Unintended Consequences
by Fisher
Strategy+Business
Fall 2005, p 78
Though certainly not a replacement for more academically-oriented reading on system dynamics constructs, Fisher provides plenty of context around the thinking and influences which shaped Jay Forrester’s work at MIT over the decades. One colleague that Forrester mentored, John Sterman, taught a 3-day course in system dynamics which I attended a few years ago in London, and I was struck by its applicability to the understanding of price movement in price-volatile commodities. That said, what I was actually engaged in back then was ‘systems thinking’ versus system dynamics, about which Forrester has said, “The trouble with systems thinking is it allows you to misjudge a system. You have this high-order, nonlinear, dynamic system in front of you as a diagram on the page. You presume you can understand its behavior by looking at it, and there’s simply nobody who can do that”.
A few more thoughts from Fisher’s article:
- system dynamics, defined: a methodology that uses computer-based models to simulate and study the interplay of growth and equilibrium over time
- when one part of a system is changed it can push back and influence other parts of the system in unpredictable and extreme ways; this is why some problems can be fixed by changing a small but consequential practice that is influencing all the other factors in the system
- most industrial activity can be represented by five networks: materials, orders, money, capital equipment, and people
- a ‘must read’ is Forrester’s Industrial Dynamics, a 1961 classic; in it he posits that most business problems are not caused by competition of market trends, but are a direct result of company practices or policy
- advanced systems dynamics software to examine would include Vensim (Ventana Systems Inc of Harvard, MA), while a simpler tool is Stella (Isee Systems of Lebanon, NH)
