These comprise edited versions of two reports submitted to the SDS. A few statements have been revised, to take account of later developments.

The Situation for System Dynamics on the International Street, November 2007

The SD situation

Clearly I have not been in a position to undertake scientific samples relating to what is said below. However, experiences and impressions have been too consistent over the years to be invalid.

• The overwhelming majority of potential users of SD applications contacted had never heard of SD before I mentioned the techniques to them.

• Most have heard of the term ‘feedback’, but do not know its role in decision support and control etc.

• Almost none was aware of the gap in effectiveness and efficiency between use of system models for control, on the one hand, and manual operation supported only by general computerisation, on the other.

• Most are unaware that capacities such as data base software confer different benefits and services from those of system-wide causal simulation models.

• The great and unique technical advantages and benefits of SD typically count for nothing in a situation of user ignorance. What weighs with potential users is the apparently threatening or intimidating unfamiliarity and riskiness of SD.

• The situation is as though I invented SD some time last year, with the techniques being totally untried. Explanations of use of many corporate models, and of academic applications, over many years also count for nothing.

• Potential users almost never understand the meaning and implications of a managed or commanded system. They do not appreciate that the main characteristics of their systems are invisible to human managers without availability of SD models.

• The presence of even severe and chronic problems that (only) SD could solve carries no practical impetus for adoption of SD. Bureaucrats privately take the view that, if problems cannot be solved by approaches of which they approve, then those problems shall remain unsolved. Absence of accountability, including for methods and techniques used, enables bureaucrats to get away with this attitude. A few examples, of high-profile applications for which only SD is viable, are:

  • Matériel procurement in the UK’s MoD and Australia’s DoD. Both are perennial ‘basket cases’ that regularly attract stick from parliamentary committees and the media.

  • The public hospital systems of the UK and Australia. Both are in long-term crisis.

  • The UK’s national rail network: a favourite ‘whipping boy’ in the Parliament and the British media.

  • International corporate tax avoidance and evasion costs the UK Treasury £10-20 billion annually. The Inland Revenue has no answer to this problem. The main tool for corporate tax avoidance and evasion is believed to be corporate SD models.

  • Cancellations, congestion and delays in North American civil aviation. SD is apparently not yet used for system control by the airlines or the FAA.

  • Pentagon and other agency planning and control for the post-initial-combat period in Iraq are now widely regarded as inept and disastrous. These manual functions have been overwhelmed by dynamic complexity.

  • The Israeli Defense Forces’ 2006 land campaign in South Lebanon suffered disappointments associated with logistics’ shortcomings and other complexity-related deficiencies in control and planning

• SD is almost entirely locked out of the Australian and UK public sectors, at all levels. In the UK at least this is significantly attributable to implacable opposition to SD from HM Treasury, which exercises iron control over other departments and agencies.

• The macro-econometric community seized control of the entire economics industry with ruthless efficiency in the mid-1950s and have maintained their power and influence ever since. Despite what I regard as gross technical inferiority of their approaches compared to SD, that community has been far more successful ‘politically’ than their SD counterpart. The SD community has behaved like Judaism, which does not proselytise.

• The situation is little better in the US and Australian DoDs and the UK MoD. In each case the 'military mathstats modeling mafia' have long acted as gatekeepers to exclude SD. In Australia and the UK these gatekeepers are known as the DSTO and the DSTL respectively. In the US the Air Force Studies and Analysis (AFSAA) Agency has very recently begun to acquire SD modeling software. So far, however, that has done nothing to advance the fortunes of an existing SD application that is the most-powerful decision-support capacity for Air command and control.

• SD is well represented in the big corporates and in the academic world. However, the corporate models are almost never publicised and the mass of humanity is unaware of them.

• SDS chapters controlled and run mainly by and for academics apparently do little to promote SD. After fifty years it remains mainly a niche and cult discipline that has never realised its potential, and which most people have never heard of.

• Its proper technical status is that of the modern approach to control and decision support etc. This implies system-wide, detailed professional applications that are multi-functional in terms of problem-solving. Until very recently the SDS web site apparently did not reflect this: referring instead to identifying ‘a problem’ and developing a model to solve that problem. This arguably trivialises SD; pandering to its academic users, who have neither the time nor the inclination to develop large system-wide models. If SD has a future, that future must emphasise such models to a much greater extent than currently. The mentality within the SDS is still firmly wedded to ‘problem identification’. However its web site has recently been amended in the right direction.

• I have encountered individual potential users of professional applications who actually believe that system-wide, detailed, multi-functional SD applications are somehow improper: not in keeping with the purposes of SD. How did these people pick up such a ludicrous misconception?

• I have also encountered instances in which shortcomings of SD practitioners have turned actual and potential clients off the SD approach. Circumstances have involved lack of content and detail, either in a proposal for a professional application, or in the delivered product. In the face of a commercial deadline or a revenue-cost squeeze there is the temptation, for instance, to quietly forget anything that cannot be handled by the SD language. Professional SD simply cannot afford to lose brownie points in these ways. Like people from disadvantaged minorities SD must always be ahead of the pack, if the discipline is to advance.

In the face of the above difficulties a standalone professional SD developer is in a very poor position for purposes of promoting applications. After fifty years the ground has not been prepared by effective international education and promotion. Vast tracts of the developed world remain no-go areas or terra incognita for SD.

Proposed action

The SDS may well be content with the present position. If not, four types of initiative can be suggested to advance the coverage and influence of SD.

• The SDS might use its networking connections to facilitate commercial arrangements for the promotion and distribution of my four completed applications. Such arrangements would considerably enhance the professional influence and reach of the SD discipline. The applications are in disparate functional areas and range across private and public sectors and the civilian-military divide – in many countries. Advancement of these applications would stimulate the undertaking of other generic and heuristic system-wide SD applications (of which there are many waiting to be done). It appears unlikely that any one existing company would be in a position to promote and distribute all four applications. One or more prime contractors are needed to undertake marketing, client liaison and data collection etc, with me as subcontractor.

• My economic policy project can probably only be undertaken in the USA. The project would end half a century of improper SD exclusion from policy areas, and would underline the discipline’s appropriate role and status. In principle the project can be undertaken either professionally or academically. Given its huge academic implications my instinct is that the project should be undertaken either academically or with a strong academic affiliation. The SDS could again consider using its networking connections to facilitate the establishment of this project (known as BEST OFFER) in a suitable institution. The project may not be welcome in an economics faculty. In any case it is management science.

• The SDS could facilitate arrangements for one or more of the seven high-profile applications listed above as examples to be undertaken. Each is virgin territory for modern decision support. Each application would significantly advance SD’s influence and stature, and would lead to additional applications for SD. The SDS could become directly involved as a lobby group, to interact with target organisations at high levels in order to promote the claims of SD.

• ‘Panzer’ tactics, employed so successfully in the 1950s and beyond by the macro-econometric community, could be studied, learned from, adapted and emulated by the SDS, for purposes of advancing international awareness, influence and professional use of SD.

Capturing Economic Policy for System Dynamics, February 2008 

Accommodation and Coexistence, or Confrontation and Displacement?

Having for my sins devised a serious alternative to the macro-econometric orthodoxy I am currently seeking an appropriate academic institution in which to undertake the project, known as BEST OFFER. The initial response to my enquiry from one senior academic member of the SD community (SDC) appears especially pertinent to the challenges and choices now faced by the SDS on behalf of the SDC, in attempting to grow the SD field in its second fifty years1.

I therefore wish to canvass some of the issues and implications associated with that response.

‘I'm not sure we should actually try to "replace" macroeconomics and econometrics in economic policy -- I'd guess that sort of frontal assault would doom us to failure even more extreme than what you describe in your papers about the poor state of system dynamics. I tend to think doing good/great work along side classical economics approaches, and using, where appropriate, all the economic wisdom we can muster, gives us the greatest chance of having an effect in economic policy’.

As much as I disagree with this statement I am indebted to my academic correspondent for making it. The statement is a clear point of view, made at a strategic time for SD, that enables some home truths to be bounced off it. I have no idea to what extent this statement reflects SDC opinion and aspirations2.

In a great debate from the later 1960s to the early mid-1970s3 reasons for the (documented) bankruptcy and failure of the orthodoxy were described in detail by many of the most-senior academic economists of the period. The orthodoxy was correctly depicted by one participant4 as ‘a self-sealing ideology’ that automatically rejects and excludes anything (fact, concept, data, supplement, alternative etc) inconsistent with itself5.

For the entire lifetime of SD the orthodoxy has enjoyed a monopoly position in the international economics industry. The SDC, as far as I know, has never made any inroads into the immense power and influence wielded by the orthodoxy6. The entire gamut of processes involved in policy-making, regulation, parliamentary oversight and scrutiny, and journalistic commentary is conducted entirely and only in macro terms. Nobody and nothing else gets a look in7.

Immense self-interest is associated with this situation. Macro has a lot to lose8. It knows how to protect its turf, and all its bases are covered9.

Policy effectiveness and efficiency have little or nothing to do with maintenance of the macro position10. The above internalisation of processes ensures that. Virtually no independent interests are in a position to interfere with the well-oiled macro power machine11.

In the above context my academic correspondent advocates accommodation of and coexistence with the orthodoxy. From the SDC viewpoint that situation has prevailed for fifty years already. Its ‘benefits’ are therefore already known. In particular, unless I am misinformed the effective contribution that SD has been allowed to make to practical policy has been miniscule. This is advocated to continue.

The orthodoxy is not interested in coexisting with, or being accommodated by, anybody or anything. Its domination remains total and it will not willingly cede a square centimetre of turf. The SDC has enforcedly remained largely impotent and irrelevant to economic policy for fifty years. Macro intends that situation to continue.

My academic correspondent proposes that SD should continue to operate within the macro framework. This would guarantee a macro hegemony, and the practical irrelevance of SD to economic policy, into the indefinite future12. Until recently the existence of a claimed alternative to macro has not been known to the SDS, which may have also been less active in growing the field than it wishes to be in future.

Consider the following:

• Both the Roman Empire and the Third Reich, inter alia, once appeared as omnipresent and eternal as macro may appear now.

• Technically SD is greatly superior to econometrics for policy purposes.

• Macro really is a bankrupt failure, that continues only on the basis of entrenched power and influence, and because everybody has been wimpishly content to play the game on macro’s terms.

• A superior alternative to the orthodoxy is available and is within the capacity of the SDC to deliver.

• For these reasons accommodation of, and coexistence with, the orthodoxy represent a poor rationale for the future.

• If the SDS and SDC become as effective, efficient and proactive organisationally and ‘politically’ as the orthodoxy’s cohorts have been, much is possible for SD.

• There is no feasible positive alternative to confronting and displacing the orthodoxy.

• Availability of a working policy tool using SD, that can demonstrate chapter and verse of how and why macro is time-expired and what policy should look like, could considerably facilitate the task of replacing macro.