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System purposes need not be human purposes and are not necessarily those intended by any single actor within the system. In fact, one of the most frustrating aspects of systems is that the purposes of subunits may add up to an overall behavior that no one wants. No one intends to produce a society with rampant drug addiction and crime, but consider the combined purposes and consequent actions of the actors involved:
• desperate people who want quick relief from psychological pain
• farmers, dealers, and bankers who want to earn money
• pushers who are less bound by civil law than are the police who oppose them
• governments that make harmful substances illegal and use police power to interdict them
• wealthy people living in close proximity to poor people
• nonaddicts who are more interested in protecting themselves than in encouraging recovery of addicts
Altogether, these make up a system from which it is extremely difficult to eradicate drug addiction and crime.
Systems can be nested within systems. Therefore, there can be purposes within purposes.
Keeping sub-purposes and overall system purposes in harmony is an essential function of successful systems. I’ll get back to this point later when we come to hierarchies.
The purpose of a university is to discover and preserve knowledge and pass it on to new generations.
You can understand the relative importance of a system’s elements, interconnections, and purposes by imagining them changed one by one. Changing elements usually has the least effect on the system.
A tree changes its cells constantly, its leaves every year or so, but it is still essentially the same tree.
The university has a constant flow of students and a slower flow of professors and administrators, but it is still a university. In fact it is still the same university, distinct in subtle ways from others, just as General Motors and the U.S. Congress somehow maintain their identities even though all their members change.
A system generally goes on being itself, changing only slowly if at all, even with complete substitutions of its elements—as long as its interconnections and purposes remain intact.
The least obvious part of the system, its function or purpose, is often the most crucial determinant of the system’s behavior.
If the interconnections change, the system may be greatly altered. It may even become unrecognizable, even though the same players are on the team. Change the rules from those of football to those of basketball, and you’ve got, as they say, a whole new ball game.
Changing interconnections in a system can change it dramatically.
A change in purpose changes a system profoundly, even if every element and interconnection remains the same.
Changes in function or purpose also can be drastic. What if you keep the players and the rules but change the purpose—from winning to losing, for example?
To ask whether elements, interconnections, or purposes are most important in a system is to ask an unsystemic question. All are essential. All interact. All have their roles. But the least obvious part of the system, its function or purpose, is often the most crucial determinant of the system’s behavior. Interconnections are also critically important. Changing relationships usually changes system behavior. The elements, the parts of systems we are most likely to notice, are often (not always) least important in defining the unique characteristics of the system—unless changing an element also
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Information contained in nature … allows us a partial reconstruction of the past.… The development of the meanders in a river, the increasing complexity of the earth’s crust … are information-storing devices in the same manner that genetic systems are.… Storing information means increasing the complexity of the mechanism. —Ramon Margalef2
Ramon Margalef, “Perspectives in Ecological Theory,” Co-Evolution Quarterly (Summer 1975),
A stock is the foundation of any system. Stocks are the elements of the system that you can see, feel, count, or measure at any given time. A system stock is just what it sounds like: a store, a quantity, an accumulation of material or information that has built up over time.
A stock does not have to be physical. Your reserve of good will toward others or your supply of hope that the world can be better are both stocks.
A stock is the memory of the history of changing flows within the system.
Stocks change over time through the actions of a flow. Flows are filling and draining, births and deaths, purchases and sales, growth and decay, deposits and withdrawals, successes and failures. A stock, then, is the present memory of the history of changing flows within the system.
If you understand the dynamics of stocks and flows—their behavior over time—you understand a good deal about the behavior of complex systems.
From it you can deduce several important principles that extend to more complicated systems: As long as the sum of all inflows exceeds the sum of all outflows, the level of the stock will rise. As long as the sum of all outflows exceeds the sum of all inflows, the level of the stock will fall. If the sum of all outflows equals the sum of all inflows, the stock level will not change; it will be held in dynamic equilibrium at whatever level it happened to be when the two sets of flows became equal.
The human mind seems to focus more easily on stocks than on flows. On top of that, when we do focus on flows, we tend to focus on inflows more easily than on outflows.
A stock can be increased by decreasing its outflow rate as well as by increasing its inflow rate.
A stock takes time to change, because flows take time to flow. That’s a vital point, a key to understanding why systems behave as they do. Stocks usually change slowly. They can act as delays, lags, buffers, ballast, and sources of momentum in a system. Stocks, especially large ones, respond to change, even sudden change, only by gradual filling or emptying.
People often underestimate the inherent momentum of a stock. It takes a long time for populations to grow or stop growing, for wood to accumulate in a forest, for a reservoir to fill up, for a mine to be depleted.
Stocks generally change slowly, even when the flows into or out of them change suddenly. Therefore, stocks act as delays or buffers or shock absorbers in systems.
Changes in stocks set the pace of the dynamics of systems. Industrialization cannot proceed faster than the rate at which factories and machines can be constructed and the rate at which human beings can be educated to run and maintain them.
The time lags that come from slowly changing stocks can cause problems in systems, but they also can be sources of stability.
The time lags imposed by stocks allow room to maneuver, to experiment, and to revise policies that aren’t working.
If you have a sense of the rates of change of stocks, you don’t expect things to happen faster than they can happen. You don’t give up too soon. You can use the opportunities presented by a system’s momentum to guide it toward a good outcome—much as a judo expert uses the momentum of an opponent to achieve his or her own goals.
There is one more important principle about the role of stocks in systems, a principle that will lead us directly to the concept of feedback. The presence of stocks allows inflows and outflows to be independent of each other and temporarily out of balance with each other.
It would be hard to run an oil company if gasoline had to be produced at the refinery at exactly the rate the cars were burning it. It isn’t feasible to harvest a forest at the precise rate at which the trees are growing. Gasoline in storage tanks and wood in the forest are both stocks that permit life to proceed with some certainty, continuity, and predictability, even though flows vary in the short term.
Stocks allow inflows and outflows to be decoupled and to be independent and temporarily out of balance with each other.
Human beings have invented hundreds of stock-maintaining mechanisms to make inflows and outflows independent and stable.
Reservoirs enable residents and farmers downriver to live without constantly adjusting their lives and work to a river’s varying flow, especially its droughts and floods.
Banks enable you temporarily to earn money at a rate different from how you spend.
Inventories of products along a chain from distributors to wholesalers to retailers allow production to proceed smoothly although customer demand varies, and allow customer demand to be filled even though production rates vary.
Most individual and institutional decisions are designed to regulate the levels in stocks.
If inventories rise too high, then prices are cut or advertising budgets are increased, so that sales will go up and inventories will fall. If the stock of food in your kitchen gets low, you go to the store.
People monitor stocks constantly and make decisions and take actions designed to raise or lower stocks or to keep them within acceptable ranges. Those decisions add up to the ebbs and flows, successes and problems, of all sorts of systems. Systems thinkers see the world as a collection of stocks along with the mechanisms for regulating the levels in the stocks by manipulating flows. That means system thinkers see the world as a collection of “feedback processes.”
Systems of information-feedback control are fundamental to all life and human endeavor, from the slow pace of biological evolution to the launching of the latest space satellite.… Everything we do as individuals, as an industry, or as a society is done in the context of an information-feedback system. —Jay W. Forrester3
Jay W. Forrester, Industrial Dynamics (Cambridge, MA: The MIT Press, 1961), 15.
When a stock grows by leaps and bounds or declines swiftly or is held within a certain range no matter what else is going on around it, it is likely that there is a control mechanism at work. In other words, if you see a behavior that persists over time, there is likely a mechanism creating that consistent behavior. That mechanism operates through a feedback loop. It is the consistent behavior pattern over a long period of time that is the first hint of the existence of a feedback loop.
A feedback loop is formed when changes in a stock affect the flows into or out of that same stock. A feedback loop can be quite simple and direct. Think of an interest-bearing savings account in a bank. The total amount of money in the account (the stock) affects how much money comes into the account as interest.
Feedback loops can cause stocks to maintain their level within a range or grow or decline. In any case, the flows into or out of the stock are adjusted because of changes in the size of the stock itself. Whoever or whatever is monitoring the stock’s level begins a corrective process, adjusting rates of inflow or outflow (or both) and so changing the stock’s level. The stock level feeds back through a chain of signals and actions to control itself.
Not all systems have feedback loops. Some systems are relatively simple open-ended chains of stocks and flows. The chain may be affected by outside factors, but the levels of the chain’s stocks don’t affect its flows. However, those systems that contain feedback loops are common and may be quite elegant or rather surprising, as we shall see.
A feedback loop is a closed chain of causal connections from a stock, through a set of decisions or rules or physical laws or actions that are dependent on the level of the stock, and back again through a flow to change the stock.
