System dynamics-background, methodology and applications.2. Applications

For part 2, see ibid., October 1993. System dynamics is a methodology for modelling and redesign of manufacturing, business, and similar systems which are part man, part machine. Some management consultants make extensive use of system dynamics, whilst others do not. Why is this so, and is it primarily an educational problem? The author describes the methodology, traces its history, and shows how it fits into a problem-solving spectrum in between, but overlapping with, system theory and system thinking. He considers what can be done to better exploit system dynamics in the area of improving business competitiveness. The solution proposed is to integrate the use of servotheory within the system dynamics framework. The illustrative example chosen requires the smoothing of material flow within a supply chain via the effective use of all available marketplace information in contrast to acting only on distorted orders passed on by the adjacent echelon. It is concluded that the ideal background for a successful system dynamicist is good experience in both control and industrial engineering.