STOCKS AND FLOWS

Stock and flow diagrams contain specific symbols and components representing the structure of a system. Stocks are things that can accumulate—such as employee head count or inventory. (Think of a stock as a bathtub.) Flows represent rates of change—such as annual employee turnover or quarterly reductions in inventory through sales. (Think of a flow as a bathtub faucet, which adds to the stock, or a bathtub drain, which reduces the stock.) These diagrams also contain "clouds," which represent the boundaries of the problem or system in question. Here's a simple example:



Stock and flow diagrams provide a bridge to simulation modeling, because they help you assign equations to the relationships between variables. Creating a stock and flow diagram together with your team is valuable because it generates as full a picture as possible of how everyone views the system in question. Remember the parable about the blind men feeling the elephant (the man feeling the trunk thinks of elephants as long and skinny; the one feeling the ear thinks of the animals as flat and floppy)? As this parable suggests, you can design effective solutions to problems only after you have as complete a picture as possible of what systemic structures are causing your problem.

All materials © Pegasus Communications. All rights reserved.