Growth Dynamics in New Markets

SYSTEM DYNAMICS: A METHODOLOGY FOR MODEL‐BASED MANAGEMENT

9.1 Introduction

You have gone through six cycles of conceptualizing and modelling causal structures, making these structures operational as part of a simulation model and analysing the simulated behaviour. This gave you an understanding of the system and the dynamics of NewTel’s business system in Plutonia.

In this ninth chapter, we systematize the different insights that you have gained during your journey as manager of NewTel and situate them in a more general framework. Firstly, we arrange these insights into a ‘big picture’ in the context of the nine major insights mentioned at the outset of the book. Secondly, we recount the methodology used throughout the book in more general terms: system dynamics, the development and exploitation of simulation models to design policies (Forrester, 1961; Sterman, 2000). We will outline the skills and knowledge that comprise system dynamics methodology – the system dynamics competence framework. Then, we position the methodological elements, the principles, and the guidelines that you learn in this competence framework. This gives you the opportunity to apply your modelling skills to management or business challenges different to those encountered in this book.

9.2 Your mental model of growth from diffusion

Throughout the process of successively formulating and evaluating your simulation model, you have developed a mental model of NewTel’s business problem and used this to ...