System Dynamics

I completed a Summer Research Internship at the Systems Realization Laboratory at the University of Oklahoma under the mentorship of Dr. Farrokh Mistree (Ph.D. in Engineering from UC Berkeley) and Dr. Janet K. Allen (Ph.D. in Biophysics from UC Berkeley). 

Introduction

Despite all the analytical prowess that we have achieved in this age, the problems are getting more and more difficult to solve. It’s not just the problems that are getting harder, but the dilemmas of which problems to solve are getting complex day by day. Our world has never been so interconnected as it is today. In this intricate system where the issues are interlinked, solving an issue might solve another issue but it would also have a negative impact on another issue. This is why we need Systems dynamics. Just identifying and solving issues is not enough, but we need to also identify and probe the dilemmas present in the system and make informed decisions regarding which dilemmas should be addressed so that we minimize the negative side effects that would be manifested in the future as a result of our present decisions. 

Dilemma Triangle Method

Dilemma Triangle Method (DTM) is used to identify the issues in complex systems and thus we can make several policies addressing those issues based on DTM. In this paper, Dilemma Triangle Method was carried out using custom-made Excel-VBA software.

In DTM, we align issues that can be addressed by three drivers:

1. People
2. Planet
3. Progress

So using these three drivers as a sort of parameter, we would probe the issues in the given complex system.

The two major components of DTM are:

1. Tension Matrix
2. Dilemmas with Value Proposition

Tension Matrix

A tension matrix is a 2-Dimensional Matrix that helps in identifying the relationship between issues (A matrix which is made after I X I, where I is a set of Issues). Now, the issues are written in the First Row and First Column, and the relationship is described in the cells of the table. There are four types of relations between issues:

1. Tension: This is a situation wherein a solution for one issue would prove to be problematic for another issue within the same thematic area
2. Dependents: This is a situation wherein a solution for one issue would prove to be a solution for another issue within the same thematic area
3. Inter-Tension: This is a situation wherein a solution for one issue would prove to be problematic for another issue in different thematic areas
4. Inter-Dependents: This is a situation wherein a solution for one issue would prove to be a solution for another issue in different thematic areas

Dilemmas with Value Proposition

After carefully analyzing the relationship between the issues by constructing and studying a Tension Matrix, Dilemmas are born. Dilemmas arise due to tensions and dependencies of issues with one another. To evaluate and make better decisions on these dilemmas, value propositions are proposed.

System Dynamics

System Dynamics is employed to identify which dilemma to solve. System dynamics is an approach that is aided by computation to analyze policies and scrutinize the possible cause and effects. Systems are not always linear. They are rarely linear. We define our goals and take steps towards that decision to affect the state of the system. However, this is not the only variable here. Our steps would also have unintended side effects which also affect the state of the system. Apart from the effects of our decisions, other people’s decisions also contribute to the state of the system. The actions of other people also have side effects which alter the state of the system.

So all in all, the systems are complex and thus we need a computational approach. In this internship, I learned Vensim software to make a visual representation of the system.

In systems dynamics, two approaches were implemented:

1. Causal Loop Diagram
2. Stock and Flow Diagram

Causal Loop Diagram

A causal loop is a diagram that helps us to better understand the relations between variables and thus represent a complex system. Vensim is software that makes building a causal loop easier and helps us better understand a complex system.

Components of Causal Loop Diagram:

1. Variables- These are the elements of the system. 
2. Arrows- The relationship between the variables of the systems is established by arrows. An arrow from “Variable A” to “Variable B” signifies that change in “Variable A” induces a change in “Variable B”.
3. Signs- The type or nature of the change between variables is described by signs. A “+” sign showcases that the two variables are in direct proportion with each other. If there is a “+” sign between “Variable A” and “Variable B” where the directionality of the arrow is from “Variable A” to “Variable B”, it means that if “Variable A” is increased then “Variable B” also increases and vice versa. A “-” sign showcases that the two variables are in inverse proportion with each other. If there is a “-” sign between “Variable A” and “Variable B” where the directionality of the arrow is from “Variable A” to “Variable B”, it means that if “Variable A” is increased then “Variable B” decreases and vice versa.

Stock and Flow Diagram

Stock and Flow diagrams are Quantitative representations of a System that helps us to compare dilemmas against each other. A stock variable is a variable whose value is dependent on that instantaneous moment. The magnitude of the stock variable represents the amount that exists at that particular instant. A flow variable is a variable that is measured over a time period. A flow of a quantity is measured with a reference to a particular time frame which can be hours, days, months, years, decades, etc.

For example, the income of a person is flow while the bank balance of that person is stock

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