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European Journal of Operational Research 113 (1999) 501527

Theory and Methodology

Social theory and system dynamics practice

David C. Lane
Operational Research Department, London School of Economics and Political Science, Houghton Street, London WC2A 2AE, UK Received 27 January 1997; accepted 11 May 1998

Abstract This paper explores the social theories implicit in system dynamics (SD) practice. Groupings of SD practice are observed in dierent parts of a framework for studying social theories. Most are seen to be located within `functionalist sociology'. To account for the remainder, two new forms of practice are discussed, each related to a dierent paradigm. Three competing conclusions are then oered: 1. The implicit assumption that SD is grounded in functionalist sociology is correct and should be made explicit. 2. Forrester's ideas operate at the level of method not social theory so SD, though not wedded to a particular social theoretic paradigm, can be re-crafted for use within dierent paradigms. 3. SD is consistent with social theories which dissolve the individual/society divide by taking a dialectical, or feedback, stance. It can therefore bring a formal modelling approach to the `agency/structure' debate within social theory and so bring SD into the heart of social science. The last conclusion is strongly recommended. 1999 Elsevier Science B.V. All rights reserved. Keywords: Systems; Simulation; Philosophy; Relationships with other disciplines; Modelling

``System dynamics needs a broader and deeper debate about its underlying philosophy, the contrast with alternative philosophies, the nature of knowledge, the role of subjective and observational information, and the criteria for judging validity''. Forrester (1980a, p. 15)

1. Introduction This paper explores the practice of system dynamics (SD) modelling in the context of some

theories of the social sciences. The motivation derives from a comparative study of SD and OR (Lane, 1994a) which observed that connections between the grounding theories of the social sciences and OR have been explored to a much greater and fruitful extent than the possible connections with SD. But what is meant by social theory, and why might the activity of SD modelling wish to be related to it? In discussing the social theory of any modelling approach we can unravel dierent elements of the process. We can use Eden's headings and so talk about an approach as consisting of tools, techniques, method and theory (Eden, 1989, 1990). Although these elements

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derive from the study of group decision support approaches they are in the same spirit as Checkland's analysis of systems approaches (Checkland, 1981) and may reasonably be applied to any OR approach. With SD we then have simulation `tools' such as iThink and Vensim and we employ various `techniques' of knowledge elicitation, model validation and quantitative simulation. Combined with rules about the correct construction of models and the aspirations of the approach, these all unite to form the `method' of SD. Now when we ask what the theory is, it is clear that we are asking a deeper question. In pursuing the social theory of SD we are asking, ``What model of social reality is implied by the... methodology'' (Checkland, 1981, p. 245). All OR modelling approaches may be related to a social theory some assumptions of how human beings behave in society, how they communicate and make decisions, how knowledge about such processes can be acquired and what form such knowledge can take. Such assumptions may be explicitly articulated, as with the soft system methodology (SSM) approach of Checkland (1981), or they may remain as unexamined presuppositions. Nevertheless, these assumptions have implications for the type of modelling work that is possible and the nature of any changes that may be made in consequence. The extent to which the process of SD has articulated a social theory for its practice is considered in the next section but the comment ``The present [system dynamics] paradigm is not sharply dened'' (Forrester, 1985, p. 1) indicates a lack of clarity at this deep level since Forrester also observes that, ``surprisingly few papers discuss the philosophy and validity of models'' (Forrester, 1985, p. 2). The potential advantages of debating the social theoretic assumptions of SD are many. The social sciences are perhaps over-rich in descriptive theories which have limited practical application whilst SD oers a formal theory which is highly practical. Interaction of the two therefore oers the potential of supplying SD for the practical study of a wider range of issues in the social sciences. This can only enhance the respectability of SD but has been limited in the past because the lack of a clear theory has resulted in criticisms of SD and ``the

opportunities [the criticisms] aord for inuencing other paradigms have not been pursued'' (Meadows, 1980, p. 1) because of the eld's inability to conduct a discourse at the appropriate level. Similarly, the crafting of a suitable social theory for SD would allow more eective reection on practice and hence more coherent re-crafting of that practice. Practice may also be enhanced by comparison with other approaches which share the same basic assumptions since deep commonalties will become visible (Lane, 1994a). Additionally, research at this level will contribute to the debate on choice of method (Flood and Jackson, 1991; Watson, 1992) and clarify appropriate validation criteria (cf. Eden, 1995; Lane, 1995a). The consideration of such issues is found in other disciplines. In addition to OR, we might also compare the debate with that which continues in the eld of information systems. Various authors have illustrated that completely dierent sets of assumptions about social reality may be used fruitfully; each oers dierent approaches and insights but, in their own terms, each appears to be valid (see Galliers, 1991; Hirschheim and Klein, 1989). The same paradigmatic approach of these authors is taken in this paper. We rst give a brief account of the various ideas and debates concerning SD. We then describe and explore a framework for understanding dierent schools of social theory. This framework is then used to analyse both current and potential forms of practice. We close by oering three competing conclusions to this analysis and discuss the implications of each. 2. System dynamics modelling practice: A historical review of ideas and debates System dynamics certainly possesses explicit theory. The two notions that the feedback approach and the endogenous perspective generate explanatory power are theories (Forrester, 1961), as is the hierarchy of system structure (Forrester, 1968b) but these are not social theories. The social theoretic assumptions of SD must be inferred from the literature of the eld, there being few examples of such theories being articulated explicitly. In this

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section we therefore revisit the key descriptions of SD modelling and raise from the ``sub-conscious'' to the ``conscious'' level (cf. Meadows, 1980) the social theoretic assumptions that these descriptions make. 2.1. The initial ideas of system dynamics Forrester (1961) laid out the fundamental ideas of the eld to the extent that most of the work since then might be seen as extensions, elaborations and implementations of these core initial concepts. From a social theoretic perspective, it oers a stimulating combination of dierent ideas, sometimes mutually supportive, sometimes contradictory. The position appears to be ontologically realist; SD models are presented as abstract representations of the actual physical and information ows in a system, their feedback implying that, ``decisions are not entirely ``free will'' but are strongly conditioned by the environment'' (Forrester, 1961, p. 17). However, in contrast to this seemingly objective stance, Forrester proposes that the purpose of a model is to manifest a mental model, to state it in a `precise' way. In consequence, a model should be focused around a particular issue. A wide range of data sources is proposed, including externally stored data on tangible objects and knowledge about systems held only in the minds of system actors. The limited ability to share, challenge and generally utilise mental models would be assisted by articulating personal assumptions, whilst computer simulations would form managerial laboratories in which meaningful experiments could be conducted regarding the inherent behaviour characteristics of a dynamic, non-linear feedback system. The purpose was therefore not just to explain but to aid system re-design and to promote individual and organisational learning in order to impart ``a better intuitive feel [which] improves... judgement about the factors inuencing company success'' (Forrester, 1961, p. 45). As a result, the usefulness, and hence validity, of such models would only be appropriately judged in a personal way, ``the evaluation of improved managerial eectiveness will almost certainly rest on a subjective judgement

rendered by managers in regard to the help they have received [from engaging with a model]'' (Forrester, 1961, p. 115, italics added). Later works extended the application areas and embellished the details of the approach but kept to the initial ideas (Forrester, 1968a, b, 1969, 1971a). Forrester (1971b) sought to improve both validation and implementation by emphasising the role of a `process' of modelling. He contrasted this stance with an over-attachment to nalised, blackbox models which he all too frequently saw cast in the role of oracle. 2.2. The eld develops and broadens Bell and Bell (1980) directly addressed questions of ontology and epistemology. Rejecting instrumentalism and `dogmatic paradigmism', they advanced refutationism as the appropriate theory for SD since causal models oer clear test points by which problems can be solved and theory advanced. Meadows' attempt explicitly to probe the ``deep, implicit operating assumptions'' (Meadows, 1980, p. 23) of SD though frequently cited in fact discriminated between the `paradigms' of SD and econometrics on the grounds of the use to which respective models are put. The detailed quantitative analysis for precise prediction and the use of statistical validation techniques in econometrics was contrasted with the policy design aspirations and validation by condence approach of SD. The aim of this paper was to reveal the fundamentally dierent assumptions in the two elds in the hope of improving mutual understanding and the poor reputation SD had acquired amongst economists. Sterman (1988a) revisited this debate and oered a strong argument, emphasising that the, ``primary function of model building should be educational rather than predictive... modeling [is] a process rather than... a technology for producing an answer'' (p. 165). The provision of a modelling process as a means of creating individual learning by personal experience was problematic in an age of mainframe computers and text-driven programs. System dynamics modelling was happening, primarily,


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away from clients. Additional work was necessary to use the model to adjust managers' mental models. In consequence, concern moved to the somewhat neglected process of `implementation' (e.g. Roberts, 1978). Richardson and Pugh (1981) were well aware that, ``A model's utility and effectiveness depend... on the degree to which the model communicates, helps to generate insights, enhances understanding, and in general reaches and inuences its audience'' (pp. 312313) and stated the diculties very clearly; ``The need to insinuate model-based policy conclusion in the intuition of the client suggests [that] the client be an integral part of the modelling process. Insights, when they come, are more likely to come out of the process rather than the nal products of a modeling study'' (p. 355). In response they developed the work of Forrester and Senge (1980) and described validation as a hybrid combination of interwoven technical and more subjective elements. 2.3. A tension within system dynamics The tension implicit in this last combination may be found in Forrester (1980a), in which he appears to take a strikingly deterministic, and nomothetic, approach to the nature of human decision making whilst re-emphasising the role that personal experience plays in gaining insights from a model building process. The hybrid approach of Richardson and Pugh can therefore be seen as presaging what became two dierent responses to the issues of validation and implementation. The more technical approach pushed the refutationist line (Bell and Senge, 1980) and introduced some statistical validation tests as a means of generating condence (Sterman, 1984; Barlas, 1986). Similarly, the behavioural decision making wing of SD including the bounded rationality work of Morecroft (1983) and exemplied by Sterman (1989) employs controlled experiments to demonstrate how system structure inuences human decision making. The alternative view focused attention on the social aspects and requirements of model building. The use of causal loop diagrams (CLDs) was recrafted in an attempt to render both models and

model building more accessible to client understanding (Goodman, 1974; Roberts et al., 1983) and `qualitative SD' (or QSD) appeared (Wolstenholme and Coyle, 1983). The notion of learning in an organisational context began to be studied explicitly (Senge, 1985, 1990a) and new software tools were developed to break down the barrier between model and model-owner (Richmond, 1985; Richmond et al., 1987). Morecroft (1988) reported that Seymour Papert's idea of `transitional objects' had been united with (a very US view of) group decision support to produce a role for SD modelling as a process for supporting strategic debate. The use of computer-based, prepackaged `management ight simulators', `management games', or `micro-worlds' was proposed as a way of accelerating the process of conveying dynamic insights and understanding (Sterman, 1988b; Kim, 1989; Senge and Sterman, 1992; Lane, 1995b), whilst D.L. Meadows (1989) developed board games, or board game-like interfaces with the same aim. Senge (1990b) united many of these existing ideas to propose certain SD elements as tools for negotiating and sharing organisational vision and enabling organisational learning and commitment. Lane (1992) advocated a style of facilitation consultancy based on the ideas of Schein (1969) and explored how the `Modelling as Learning' group decision support (GDS) approach tted in with similar OR tools whilst beginning to advance a more socially subjective understanding of such processes, a view discussed further in Lane (1994a). Finally, Richardson and Andersen (1995) described the dierent technical and social roles that were required for group model building to be eective. 2.4. Comments from outside the eld Keys (1988, 1990) oered the view that SD as originally created had the same major assumptions as hard system approaches but then underwent signicant change when it engaged with pluralist contexts, becoming more subjective and shifting towards but, signicantly, not into the theory of soft approaches. Rather baingly, Keys sees the key change as being ``the use of inuence diagrams

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to provide an initial focus for the analysis'' (Keys, 1990, p. 486). This attempt to occupy two philosophical stances is deemed to have opened up SD to criticisms from both sides. Although Keys (1988) advanced the possibility that SD is an amalgam of objective and subjective approaches, he forewarned that ``if this is a valid explanation, then it must be shown how SD can break through paradigm incommensurability in a logically consistent way'' (p. 223). This analysis is in harmony with the work of Flood and Jackson (1991) in which SD is labelled as being based on `unitary' assumptions about organisations and `simple' assumptions about the system under study. These impoverished views would appear to persist in seeing SD as, ``an attempt to apply the ideas of control engineering to socio-economic problems'' (Keys, 1988, p. 8), ignoring or being unaware of the importance attached to the personal experience of model building and the associated process of experiential learning. Finally, Dash (1994) oers a more recent account of the eld. Drawing on a more broad literature than Flood and Jackson, though still attached too much to European sources, he describes how its assumptions have undergone various changes, leading to a `conceptual shift' towards less objective and unitary practice. 2.5. To the present Further contributions include that of Radzicki (1990) who conrms the poor esteem in which economists hold SD. He then oers the diagnosis that this basic dierence in research philosophy is located in the utilisation by the majority of economists of the logical empiricist approach, whilst SD can be seen as an example of pragmatic instrumentalism. Barlas and Carpenter (1990), in a deep consideration of the basic assumptions of the eld, similarly reject logical empiricism. However, they employed a careful reading of Forrester and his notions that model validation is achieved solely by owner condence to support the proposal that a Quinian, relativistic approach to model validation is appropriate. Validation is then, ``a gradual process of building condence in the usefulness of

a model'' (p. 157), and it, ``is inherently a social, judgmental, qualitative process: models cannot be proved valid but can be judged to be so'' (p. 148). Hence, ``Validation is a matter of social conversation, because establishing model usefulness is a conversational matter'' (p. 157). Cavaleri (1992) explicitly considered the social theory of SD using Burrell and Morgan's framework (q.v.). He claimed that the discipline had such powerful integrative properties that it could be placed in the centre of that framework, straddling all four paradigms but his positioning is logically invalidated by his failure to address the question of inter-paradigmatic incommensurability. The need to see condence as involving both technical and social aspects is re-emphasised in Lane (1995a) which analyses the standard validation tests and nds them to be strongly biased towards technical factors. This paper then extends the framework in Richardson and Pugh (1981) by proposing further tests which might help a group develop condence by ensuring that a modelling process ts with the culture of that group and their organisation. Finally Vennix (1996) impressively advances the exploration of the links between SD and European-style GDS/OR. Drawing heavily on the literature of the latter, he shows how human interpretations of situations inuence how people dene problems, recall and value information and judge possible courses of action. From a social theoretic perspective he is saying that people's perceptions of their social environment inuence their behaviour and hence inuence the environment. He argues that social reality is a world of shared intersubjective meaning. He concludes that in doing interactive model building to address `messy' problems such features must be a central consideration if the group is to use SD to create a shared understanding of a problem. 3. Burrell and Morgan's framework for social theories We must choose a means of exploring the social theory of SD practice. Dierent approaches,


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operating at dierent meta-theoretical levels, are available. We might operate at the grand level of unprovable fundamental assumptions of science (Frankfort-Nachmias and Nachmias, 1992). We could employ Habermas' theory of human cognitive interests (Habermas, 1968; White, 1988) or use the `structuralist' or `meaning and action' perspectives of Cu et al. (1990). A choice must be made and there is no possibility of a `knockdown argument' for it. We shall choose to operate at the level of paradigm or disciplinary matrix using the classic framework of Burrell and Morgan (1979). In describing the dierent approaches to the study of organisations, Burrell and Morgan concluded that the various schools of thought can usefully be conceived as residing in four paradigms, generated by two axes. Although there are dierences of emphasis between schools, the distinctive meta-theoretical assumptions are shared within a particular paradigm and are in opposition to those of the other three. The advantage of choosing this framework is that it is useful for debating underlying assumptions whilst still being based on straightforward denitions. Used as recommended, ``as a heuristic device rather than as a set of rigid denitions'' (Burrell and Morgan, 1979, p. xii), it demonstrates considerable descriptive power. This, combined with its use in similar studies in the elds of OR and information systems (for example, Checkland, 1981; Jackson, 1993a; Hirschheim and Klein, 1989), motivates its selection here. To set the scene for the examination

of SD the two axes of this schema are described in more detail below and the constituent paradigms are then explored in Section 4. 3.1. The `nature of social science' axis: Subjectivism/objectivism In proposing this axis, Burrell and Morgan bundle together four strands of theoretical assumptions implicit in social science thought, arguing that the poles of these complexes may usefully be labelled as `subjective' and `objective' approaches to the social sciences (see Fig. 1). `Ontological' assumptions concern the nature of the phenomena being studied; what the world is and what it contains. The realist view takes the social world as being prior to individual humans and their appreciation of it, formed of tangible structures which have existence even if they are not consciously recognised and named by humans. The nominalist position views the social world as being a product of human consciousness; there is no `real' structure to the world, only the articial descriptions and names that humans agree to use as tools to make sense of the world and to negotiate their actions. `Epistemological' issues concern the type of knowledge that is possible and the means by which it can be communicated. The positivist view is that knowledge can be revealed by deducing propositions, by searching for laws (regularities, structures and causal relationships) which may be perceived

Fig. 1. The four strands of theory which constitute the `nature of social science' axis of Burrell and Morgan's schema. The `subjective' and `objective' stances possible within each strand are also displayed.

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by an external, objective, observer. The anti-positivist stance takes knowledge to be personal, concerned with experience and insight, almost spiritual in nature, and lacking laws. Knowledge is not `revealed', as implied by positivism, but `manufactured' by specic actors. The `human nature' strand concerns the implicit or explicit model of humans and their relationship with their environment. The deterministic view has people responding in an almost mechanistic way, functioning as products of an environment, or social structure, which both forms the situations which they encounter and the conditioning which they imbibe. The voluntarist approach ascribes a much more creative, free will approach to humans, having them act as agents able to create their environment by their thoughts and actions. Finally, two dierent forms of `methodology' are specied, indicating the processes by which phenomena are investigated and knowledge obtained. The nomothetic theory promotes the search for universal laws by a process of identifying tangible concepts and then constructing tests which allow the concepts to be measured. An ideographic approach is concerned with accessing the unique understanding that an individual uses to interpret the world around them.

3.2. The `nature of society' axis: Regulation/radical change The approaches dening this axis involve schools of social thought with concerns which are summarised in Fig. 2 and described below. `Regulative' theories concern the status quo, seeking to explain the processes of consensus creation and need satisfaction that result in the continuation (though also evolution) of a society. Similarly, social interactions are studied with a view to understanding their function in respect of social cohesion. In contrast `radical change' theories seek to understand the structural conicts of a society. These theories seek to understand ways of transcending present limitations to produce emancipation. 4. Exploring the paradigms 4.1. Functionalist sociology The schools of social thought which are placed within this paradigm are characterised by objective, regulative assumptions. The major contributors were originally motivated by the stunning successes

Fig. 2. The two approaches which dene the `nature of society' axis: the schools of social thought dening the `regulation' and `radical change' stances have the concerns shown.


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of natural science in the 19th century and sought to emulate them; ``From its beginning, scientic sociology has had a severe case of `physics envy'... early sociologists had a vision for sociology that looked like Newtonian physics'' (Turner, 1994, p. 42). Additionally, as these early workers in this eld made the implicit assumption that industrial society was the zenith of human achievement, problems of regulating society were deemed preeminent: interest centred on the means by which society could be seen as an integrated system. In consequence, this paradigm can be seen as having a positivistic approach, conceptualising sociology as the objective study of existing phenomena. The application of the research approach of the natural sciences was proposed by Auguste Comte and signicantly advanced by Emile Durkheim whose work centred on the uncovering of `social facts' and their objective measurement. The goal was to generate a theory regarding the cause of a fact and

the function that it played in maintaining an orderly society and to give accounts of actions deemed to be rational in a given situation. The knowledge so revealed was claimed to be analytical, existing independently of individual consciousness and therefore public and value-free, subject to empirical testing, repeatable and refutable. As a theory, functionalism has been repeatedly developed and enhanced, constantly attacked and responsively amended in order to be rethroned. As a result, functionalism now contains a very wide range of schools of thought (see Fig. 3) and has attracted the majority of workers in the eld. Within the `objectivism' school, `behaviourism' aspires to data-validated theories of human behaviour derived from tightly controlled stimulus and response experiments. Humans are conceptualised as passive responders, machine-like in their reactions to external conditions and the methods

Fig. 3. Framework proposing four paradigms (bold) for the analysis of social theory and the constituent schools of such social theories. Figure re-drawn from Burrell and Morgan (1979).

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of natural science are employed in the pursuit of the laws which govern behaviour in a given situation, the work of B.F. Skinner being a prime example. Objectivism also contains `abstracted empiricism', a term used to describe any of the functionalist schools which are seen as undermining the perhaps less objective strands of their stance with a profoundly and inappropriately nomothetic methodology. In the school of `social systems theory' the concept of `function' is particularly important. Social life is deemed to exist because of the functioning of its social structure, and the measurement of the attributes of this structure is a constant concern. Social systems theory is thus a clear development of positivism applied to the social sciences. Burrell and Morgan see it as consisting of two schools. `Structural functionalism' derives from Herbert Spencer's work in which the processes of evolution, development and adaptation are understood by placing heavy emphasis on analogies drawn between societies and organisms. Talcott Parsons used the approach to describe the processes by which the social system maintains equilibrium with its environment and integrated its diverse processes to preserve its internal integrity. In contrast, `systems theory' is not conned to biological analogies since its emphasis on open systems allows a wide range of analogies to be brought to bear; using principles concerning boundaries, feedback, sub-systems etc. disequilibrium and homeostatic situations can be studied. The `general system theory' of von Bertalany (1968) is an example of such a theoretical systems theory approach, derived from (but not dependent upon) biological concepts. The more practical work of the Tavistock Institute (see, for example, Dill, 1958; Rice, 1963) and that of Katz and Kahn (1966) employs a mixture of mechanical, and biological analogies, used to explain the factors which create and maintain a stable social system. Systems theory is not, of itself, tied to a regulative view of social reality; by using mechanical, biological, cybernetic, morphogenetic (q.v.), factional and catastrophic analogies, increased degrees of change can be investigated. However, the use in most cases of the rst two analogies explains the placement in the schema.

`Interactionism' is a fusion of ideas from German idealism and positivism. With contributions from Georg Simmel and George Herbert Mead, the common (positivistic) approach is the observation of the attitudes and interactions of social life, with Mead concentrating on the use of gesture and language and Simmel studying the activities of groups. The (nomothetic) goal is the uncovering of the pattern of social rules that underlies the variety and complexity of human associations. These rules are determined by larger social structures (family, tribe, state) but acts of individual association can aect these structures (an excellent example of a feedback theory) and it is this ontological stance that places this school of thought at the least objective end of the paradigm. Similar comments apply to the `social action theory' of Max Weber which attempts to understand the pattern of social life by interpreting human actions using a typology of `ideal types' of those actions (q.v.). Again, the voluntarism of the theory is mitigated by the nomotheticism of its goals and the (albeit weakened) positivism of its approach (Gneuss and Kocka, 1988). Finally, `integrative theory' is the term used to describe four sociological schools which Burrell and Morgan see as illuminating social system theory with the interactionist perspective and also addressing issues of conict arising from Marx. Of the four, the primary interest of this paper is in Buckley's `morphogenetic systems theory' which rejects as inadequate models based on mechanical or organic analogies. Buckley believed that society cannot be understood using models based on equilibrium or homeostasis. He also asserted that modern socio-cultural systems need to be understood in terms of the transmission of information, that systems theories which concentrate only on physical or material ows oer inadequate analyses. His systems models treat information as a carrier of meaning which may be present in many places and which is subject to perception and interpretation by the actors in the system. This work therefore uses ideas from systems theory and cybernetics to organise and make use of the understanding gained from interactionist research in order to explain the means by which societies change, elaborate and evolve their underlying structures.


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4.2. Interpretive sociology This alternative paradigm, itself containing many dierent views, is the product of German idealism, developed from the ideas of Immanuel Kant and George Hegel by Weber, Wilhelm Dilthey, Edmund Husserl, Alfred Schutz and Harold Garnkel. Interpretive sociology emphasises the essentially spiritual nature of the social world which must be interpreted in terms of the subjective understanding which individual human agents ascribe to their social situations. The interpretive paradigm views the social world as being constantly created by individuals via processes of dialogue, negotiation and learning. Social reality is then an emergent property of the actions of human beings, a manifestation of human consciousness brought into existence through intentional acts and intersubjectively shared meaning. Interpretation attempts to illuminate social action by oering an account of the acts of rational people and the signicance that people ascribe to those acts in order to create meaning for their conduct. The form of knowledge on oer makes for unusual science: experimental repetition can be impossible and disagreements arise concerning criteria for hypothesis testing and refutation. Explanations may operate only at the level of individual consciousness and subjectivity. Knowledge better thought of as `understanding' is not revealed but manufactured by social interaction. The least subjective of these views (see Fig. 3) is that humans externalise their personal understanding of the world through the creation of objective social phenomena, artefacts which can be interpreted by others. The need to establish criteria for validating interpretations led Dilthey to establish the science of `hermeneutics', in which an approach similar to textual analysis is used to understand and interpret the meaning and signicance of these artefacts. A signicant element of the research method here is called Verstehen. It is employed to place social researchers in the role of an individual concerned with the phenomenon, to re-experience what had originally been thought or felt by an artefact's creator. The goal is the retrieval of the meaning that he/she imparts to his/

her actions so that meaning can be communicated to others. Interpretation is then done with reference to `ideal types', a complex concept derived from Comte, Durkheim and Weber which may be read here as thinking aids, drawn from real phenomena, with which a situation is compared in order to understand its signicant components and so generate explanatory value (Oliga, 1988; Cu et al., 1990). With his `phenomenology' theory, Husserl attempted to probe not the manifestations of consciousness but individual, transcendental consciousness itself. He believed that the phenomena contained therein within the immanent consciousness, prior to any reection or judgement were the true objects of study for the social sciences (Husserl, 1907). Beyond Husserl's ideas lies the philosophy of `solipsism' in which the universe is reduced to the contents of an individual's consciousness, the extreme self-containedness of this view arguably rendering the issue of society's nature (regulative or otherwise) irrelevant and meaningless. In the school of `phenomenological sociology' a balance is struck between Husserl and Dilthey. The concern is not with objective realisations of consciousness nor with individual consciousnesses but is instead with understanding how, through social interaction, humans swap and transmit individual subjective meanings and so negotiate a shared understanding and meaning. Knowledge of this network of intersubjective meaning allows understanding of the world of everyday experiences and actions in society. Ethnomethodology is an example of a phenomenological approach (see Coulon, 1995).

4.3. Radical structuralist sociology Deemed by Burrell and Morgan to have been founded by the later writings of Marx, and taking a realist view, this paradigm uses a natural scientic approach to critique the status quo of society and to understand the contradictions and conicts inherent in the structure of society.

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Variations on this position (most deriving from dierent interpretations of Marx' writings) include Russian social theory, based on the work of Engels and Plekhanov, emphasising the scientic rationality of Marx and leading to the historical materialism of Bukharin and Kropotkin's anarchistic communism (see Fig. 3). In contrast, contemporary Mediterranean Marxism re-emphasises the Hegelian inuences, somewhat reducing the role of economic factors to allow a greater role for ideological developments and contradictions whilst preserving a positivistic and deterministic approach. Finally, conict theory contains a radicalised version of Weber's interactionist ideas, which attack economic determinism by demonstrating that economic behaviour can be formed by ideology and so oer a more sophisticated analysis of class and power legitimisation. 4.4. Radical humanist sociology In contrast to radical structuralism, the paradigm of radical humanism, with its roots in German idealism, oers a radical critique of society based on individual consciousness. Burrell and Morgan (1979) describe the fundamental concept of this paradigm as being, ``that the consciousness of man [sic.] is dominated by the ideological superstructures with which he interacts, and that these drive a cognitive wedge between himself and his true consciousness. This wedge is the wedge of `alienation' or `false consciousness', which inhibits or prevents true human fullment'' (p. 32). Viewing society as essentially anti-human because it limits personal development, this paradigm therefore takes as its aim the emancipation of humans so that they can achieve their full potential. Within this paradigm (see Fig. 3) lies `Critical Theory', the overtly political work of Max Horkeheimer, Theodor Adorno and other German scholars collectively known as the Frankfurt School who, from the 1920s, established a profoundly critical view of the shallowness of modern culture. A contemporary, and continuing, response to this despairing view is the Critical

Theory of Jrgen Habermas who sees social u development not in Marxist terms of the growth of economic production but rather centred on the accumulation of knowledge (Habermas, 1968, 1981a, b; White, 1988). Habermas seeks a form of knowledge which he calls `Emancipatory'. He argues that truth and rationality in the Lifeworld are a matter of agreement; knowledge arises from free discussion and agreement, from debate which is aware of the interests behind contributing views and treats all contributors as equal participants. Such processes will allow the creation of rational consensus via undistorted debate, or `communicative competence'. Located within this paradigm we also nd `existentialism', usually associated with Jean-Paul Sartre, a radical form of Husserlian transcendental subjectivity, and the anarchistic individualism of Max Stirner and others. The strong subjectivism or individualism of these schools make them less relevant to the discussion in this paper.

5. Explicating the social theory of established practice Because of the range of SD practices, this paper deals separately with dierent types, initially taking a chronological view and then moving to treat tailored uses of SD which can be seen as distinct. First, in this section we attempt to unearth the theory implicit in existing forms of practice. In Section 6 we then build on this analysis to propose two innovative forms of SD activity, grounded in new areas of social theory.

5.1. Initial system dynamics practice We deal rst with the practices of SD which began with the creation of the discipline (signalled by the publication of Forrester, 1958) and then followed on for the next two decades, impelled and directed by Forrester's core ideas. The location of this grouping `Initial SD' is crucial to the argument which follows (see Fig. 4). Forrester can


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Fig. 4. Explication of the social theories of SD practice. The regions (and `ashes') of established practice have been located in the social theoretic paradigms and constituent schools with which their implicit operating assumptions seem consistent. The black arrows indicate the `interpretive division' in the evolution of ideas in the eld. The two circular regions denote idealised new forms of practice. The grey arrows indicate possible inspiration or support for these paradigms by existing ideas within SD. Compare with Fig. 3.

be interpreted as having proposed a form of systems theory based on a positivistic and servomechanistic view of the social world, taking a realist and determinist stance. The approach's intended contribution to strategic change gives this grouping a slight weighting away from the regulative extreme. However, the ability to treat disequilibrium situations and the interest in representing the ow and interpretation of information allows the extension into integrative theory (via morphogenetic systems theory). Most important of all are the three notions of mental model representation, validation by condence and the provision of learning experiences based on the never entirely nished process of model building. These ideas, clearly present at the creation of the eld, indicate an embryonic inclination towards a much more interactionist stance. For two decades these founding ideas were used in an increasingly

wide range of applications. Publications during this period reect on experience and add detail but fail to advance theory to any great extent; SD seemed merely to be a new variety of computer simulation modelling. The tension innate in its contradictory ideas remained. 5.2. Broad system dynamics practice These tensions became more apparent, and began to be worked out, in the third decade of the eld's life (see region `Broad SD' in Fig. 4). In this interval of time the `period of interpretative division' we see the eects of two emerging challenges to the eld; the rst concerning the poor reception of SD among economists (see Meadows, 1980) and the second deriving from increased difculties in implementation (see Roberts, 1978).

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The responses can then be viewed as a division in approach, centred around more and less objective interpretations of the notion of `validation by condence'. Bell and Bell's (1980) support of refutationism as a theory so that causal and behavioural hypotheses are stated and tested and the subsequent employment of statistical techniques (see Sterman, 1984), aspired to the austerity of logical positivism and advanced the theory of SD in the objective direction. In their interpretation, `condence' is created by these `truly scientic' means provided by expert consultants; the methods were familiar to managers and thus implementation would be eased and also SD would be able to present itself as dierent in style to econometrics but, crucially, not dierent in kind. The alternative response saw condence as arising from social conversations. Meadows (1980) rendered SD quite distinct from econometrics on these grounds and went on to expend her considerable energies on making insights derived from the SD perspective more popularly comprehensible to people (see D.H. Meadows, 1989; Meadows, 1991). Similar attempts to cope with implementation diculties concentrated on developing approaches by which the process, and hence experience, of modelling could be brought closer to the user and its value perceived and imparted more readily. Consultants acted as process facilitators. The emphasis on CLDs and the advocacy of QSD discussed previously can both be seen as attempts to make SD models carry more meaning for untrained users. The introduction of STELLA was a late but signicant advance in this regard. The combination of technical and less objective elements to validation can be seen in the approach of Richardson and Pugh (1981) to validation and shows that this interpretation of the `condence' notion is moving to the subjective end of functionalist sociology, via integrative theory (and possibly into interactionism). The fact that this broad range of views became acceptable interpretations of Forrester's ideas may be read into his comments around that time (Forrester, 1980a) in which the original tension is re-stated, though perhaps his call for

more work on the paradigm of the eld (Forrester, 1985) indicates some discomfort in this regard. Nevertheless, in this period we can see SD establishing itself across a broad region of social theory. Although dierent and more specialised views have since emerged (see below), these still overlap with this region which may therefore be seen as the heartland of the eld of SD. The enduring relevance of these ideas is indicated by the continued appearance of diverse work done in a style best seen as consistent with this form of SD, for example, the recent studies of developing nations (Saeed, 1994) and of the software development process (Abdel-Hamid and Madnick, 1990). Arising from `Broad SD', at times which it is no longer useful to locate with great precision, we may now identify the emergence of some specialised forms of SD. It is to these that attention now turns. 5.3. Interactive system dynamics practice `Interactive SD' encompasses both SD-based interventions performed in a GDS style and its use to support organisational learning (see Fig. 4). These ideas can be seen as a signicant extension albeit a natural and evolutionary one of the least objective view of condence. Dash (1994) seems to be describing this area of practice when he refers to a `conceptual shift' in SD. The emphasis throughout Interactive SD is on the provision of tools with which individuals and groups interact in order to take a systemic view of their environment and of the current goals, actions and policies of the actors within it. The tools provide a language with which opinions can be articulated precisely and discussed so that individuals learn together and decide on a course of action which they believe will achieve agreed aims. It is this focusing on group understanding and the belief in the feedback relationship between actors and environment which places these activities at the least objective end of the paradigm of functionalist sociology. The contributors to this region are large in number so that any list of inuences risks oence.


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Sterman's piece (Sterman, 1988a) on the need to convey understanding and Richmond's concept (Richmond, 1987) of the `strategic forum' are important inuences but there are many others. These include Meadows' board games (D.L. Meadows, 1989), Morecroft's connection with the transitional object idea (Morecroft, 1988) and Lane's advocacy of increasingly personal and participative modelling in a style (Lane, 1992) motivated by the work of Schein (1969) Lane using the term `Modelling as Learning' to describe this form of GDS. The link to Schein's ideas and the connection, in turn, of his ideas to those of Goman (1959), establish this area of practice as lying within the interactionism and social action theory school. The early ideas of Vennix (1990) may be locatable here also, though this is a question to which we will return. Tools for this form of practice include even more exible, enjoyable and hence usable software, microworlds (oering prebuilt models as a path to rapid learning) and archetypes (a hybrid of concepts from QSD and the work on generic structures which provide a suite of readily usable ideographic CLD models for debating system problems). Note that the use of microworlds to facilitate organisational learning is problematic: Lane (1994a) asks whether the employment of models in pre-packaged microworlds promotes genuine change or simply generates greater support for the status quo by via more eective indoctrination. This query motivates the slight extension of this region in the regulative direction. Richardson and Andersen (1995) contributed to the understanding of the best way of patterning a formal group model-building process and similar work continues to appear from SUNY at Albany, whilst Senge (1990b) is undoubtedly the most popular expression of the `organizational learning' usage. However, the question of whether the ideas that he advocates can be located within this paradigm is problematic and is considered further Section 6.2. These diverse features together justify the extension of this form of practice into the school of interactionism and social action theory. The activities of Interactive SD are on the extreme of the range of schools contained within the

paradigm of functionalist sociology. Indeed, some of the practice included in this grouping is arguably toying with subjective ideas, perhaps presaging a new form of SD. This notion will be addressed in Section 6. Interactive SD has the advantage of a reasonably clearly stated social theory in Barlas and Carpenter (1990). Although they retain the notion that the concatenation of causal hypotheses which makes up an SD model is, ``a theory about how a system actually works'' (p. 149), so that ontologically they preserve the realist view of what a set of causal links implies about the world, their social conversation view of model validation, based on Quine's relativism, may be a signicant withdrawal from a positivist view of epistemology. 5.4. Non-conformist economics A number of usages of SD constitute this grouping. Radzicki (1990) has a detailed argument regarding the theory underlying his proposed use of SD. He describes how institutional economics draws on the work of Dewey, using pragmatic instrumentalism as it attempts to place events into known patterns in order to oer explanations of those events in a style akin to cultural anthropology. By attempting to understand the interaction between human values and the socio-economic system in mature triplistic economies, institutional economics proposes a consensus-based economic planning approach based on the use of iterative pattern modelling. The proposed use of SD as a modelling tool for institutional economics must be located in the functionalist paradigm, albeit in integrative theory, the less objective and regulative part (see Fig. 4). We can also locate here the work on evolutionary economics and stochastic recausalisation (for example, Radzicki and Sterman, 1994; Mosekilde et al., 1983, respectively), though the latter is shared with the region discussed next. 5.5. Policy engineering The interpretation given in this paper to `Policy Engineering' is that it is a withdrawal from inte-

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grative theory into the `redoubt' of social systems theory (see Fig. 4). It can be traced from the work of Coyle (1977) and Lyneis (1980) and contains the continued application of system dynamics as a form of traditional simulation modelling by expert consultants as part, either of a top-down corporate planning process, or as part of the policy analysis of a social system. The name is proposed in Sharp and Price (1984) and the approach is positivist, sometimes returning explicitly to notions of refutationism (Homer, 1996). The use of CLDs notwithstanding, there is often little apparent recognition of the individuals for whom the modelling is done and the systems being studied may be purely technical, almost mechanical, in nature (see Coyle (1977) and parts of Wolstenholme (1990)). Here we nd Pidd's envelopment of SD within `hard' simulation modelling (Pidd, 1992) and work involving optimisation (see Winch, 1977; Coyle, 1996), a style of analysis which is clearly nomothetic. This area of practice also contains the work on the National Model (Forrester, 1980b, 1989) and other social problems (Levin et al., 1975). The goal of supporting large scale, strategically important analysis moves this grouping a little further up our diagram but the size of the models, the validation approach and the optimising processes frequently used with them imply a retreat from the more subjective, personal experience interpretation of condence creation. 5.6. Austere system dynamics practice This grouping brings together applications which emphasise more determinist, positivist and arguably objectivist approaches (see Fig. 4). Here, perhaps surprisingly, we might locate some of the work being done on the `validation' of microworlds, or business ight simulators in which these devices are treated almost as if their goal is behaviour modication in the style of Skinner and great emphasis is placed on the collection of quantitative data (see Bakken et al., 1992, for examples). Similarly located is the behavioural decision making work in SD (Sterman, 1989; Kleinmuntz, 1993; Paich and Sterman, 1993).

Finally, the ideas on bounded rationality (Morecroft, 1983) may also be placed with Austere SD since their treatment of humans as `satissers' rather than `optimisers' appears to be a modied form of behaviourism which leaves them responding to their environment in a more sophisticated but nevertheless deterministic way. Mis-understood as an extremist, determinist type of SD (Jackson, 1993b), at one level this work can be seen as an attempt to provide an academically irreproachable platform for SD within the positivist environment of MIT. Of more profound importance, however, is the role that this work plays in the validation of the feedback perspective as a suitable tool for understanding behavioural decision making. Forrester's views on social systems are not as clearly deterministic as they might appear. In his careful reading, Bowen (1994) views SD as being distinct from the ideas of Skinner because, although demonstrating experimentally that individual decisions are eected by system structure, ``individuals can design and aect the redesign of the social and managerial systems that impose on them'' (Bowen, 1994, pp. 87, 88). One interpretation of this position is that SD is, ``caught in an appalling paradox'' (Jackson, 1993b, p. 22), that, ``there is an apparent contradiction between deterministic ideas of systems governed in particular ways and voluntaristic ideas of our ability to do something about systems'' (Jackson, 1994, p. 220). Lane (1995c) argues that this is false and that a more careful reading is necessary. By showing from a positivist stance that the determinist approach based on feedback has explanatory power, this work justies and underwrites the use of SD as a form of modelling which has value in aiding self-awareness amongst decision-makers. Austere SD therefore underpins, and is an essential pre-requisite for, all of the SD activities that reside in the paradigm of functionalist sociology. However, there is a diculty here which has already been hinted at. It may be that the search for experimental support of clear rules underlying SD modelling undermines the more subjective elements of these two activities; if a microworld is a transitional object involving personal


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experience, can it be validated in this way? Or does such an approach smack of abstracted empiricism?

5.7. `Flashes' of practice Some uses involving utterly dierent social theories are observable but these are not so much established elds as they are sudden `ashes' of practice (see Fig. 4). To say that Wolpert's paper (Wolpert, 1992) possesses any degree of theoretical reection may be too charitable; certainly this extraordinary attempt to create a `model of the dark night of the soul' experience derives from the solipsistic extreme of interpretivism. In stark contrast, some of the work of Ryzhenkov (1989, 1990), with its emphasis on treating the economic system as a system of imprisonment, is grounded in the radical structuralist paradigm. The linkage with Bukharin's brand of Russian social theory is clear.

6. Using theory to propose new types of practice 6.1. Subjective approaches: `Agency dynamics' If we probe the evolving understanding of `condence' in SD we can see that it involves at least three ideas. Firstly, condence is derived from agreement on issue focus. However, operational researchers accept that problems usually involve some sort of gap and are hence, ``conceptual entities that don't exist in the world, but rather involve a relationship of disharmony between reality and one's preferences... [they] are partially but intrinsically subjective'' (Smith, 1989, pp. 965, 966). Secondly, we speak of the condence that model builders have in the mental models that they articulate, communicate and are therefore made aware of in the form of a model. Thirdly, condence is engendered by the process of insight generation and knowledge creation and internalisation. These three ideas can all be viewed as social phenomena involving multiple perspectives and/or consensus on issue focus, the attach-

ment of meaning to mental models and a personal, that is, experiential and therefore nominalist, approach to learning. These comments open up the possibility of `Agency Dynamics', SD practices grounded in the two subjective paradigms. The name derives from the focus on the ideas and interpretations of individual human agents, in contrast to objective approaches which treat the inuence of system structure on behaviour (Layder, 1994). The most important element of Agency Dynamics is the shift to ontological nominalism. Such a stance may appear to violate the precepts of SD but it is not always clear that nominalism is rejected in SD. In fact, the eld seems rather confused regarding the issues at stake on this. For example, the statements in Forrester (1994) do not constitute a conscious choice in favour of realism since Forrester sees the stance taken in Checkland's work as ``a curious ambivalence'' (p. 250) rather than the self-aware nominalist position that it is. Similarly, Richardson and Pugh (1981) oers an example of ontological uncertainty, proposing that, ``organizations... are feedback systems'' (p. 2, italics added) but then falling back on the argument that, ``Viewing them as such'' (ibid) is useful, a seemingly nominalist stance. Finally, Morecroft's comparison (Morecroft, 1988) of SD with OR, whilst deriving many useful practical insights, fails to recognise (and hence respond to) the profoundly dierent social theory underlying the methods that he studied. Such uncertainty and ignorance provides space for a debate on the ontological position of SD. There are good reasons for explicitly adopting a nominalist position in doing SD. Firstly, as argued in detail elsewhere (Lane, 1994a), taking a subjective approach opens up the possibility of engagement with the activities of `soft' OR, from which many benets would ow. Secondly, some of the current practice in the eld is better described as ``Agency Dynamics'', although the subjective stance is implicit and confused. It would be better to make this stance explicit and so hope to put such practice on a rm footing. In Sections 6.26.4 these assertions are explored further.

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6.2. `Holon dynamics' Holon Dynamics (or HD) is an envisaged form of practice grounded in the interpretivist paradigm (see Fig. 4). The name responds to Checkland (1988). With HD the notion of model building as a social process is embraced and models are nominalist representations, useful devices which help human agents to create their social worlds via debate and the construction of shared meaning. A nomothetic methodology is inappropriate since model building is accepted as a personal experience which can only be understood in its full richness (see Eden and Jones, 1980; Lane, 1997 for examples). This will also preclude positivism as an epistemology. Papers adopting this paradigm might take a hermeneutic approach, giving rich, personal accounts of projects, perhaps using some of aspects of Verstehen to enable readers to share in the meaning that had been installed in any models by describing the circumstances of its creation. Modelling within this paradigm is most likely to be in a GDS style, a phenomenological approach being adopted, with the creation of a model acting as a powerful device for co-ordinating meaningful group action. Such practice is clearly inuenced by some of the work in Interactive SD, the subjectivist stance being one towards which Vennix and Lane have been moving. The most tantalising and challenging question is: does such practice exist? Perhaps in the works of these authors and others reaching out from Interactive SD? We believe that such practice does take place, that three types of activity in our eld may be viewed as having adopted an interpretive paradigm and may therefore be thought of as HD. Unfortunately, in the case of the rst candidate Peter Senge it is dicult to tell since his most widely read piece (Senge, 1990b) is such a mixture of ideas. His work in pluralist contexts and his ideas on the participative creation of vision statements that engender deep personal commitment, may be describing implicitly the creation of intersubjective meaning. His comment that, ``systems thinking [can] become an active agent, continually revealing how we create our reality'' (Senge, 1990b, p. 95, italics added) appears both nominalist and

voluntarist. His emphasis on the use of models and microworlds to obtain personal experience appears to separate him from positivism. However, the lack of a clearly espoused social theory makes any placement of this book extremely problematic. Kofman and Senge (1993) is an improvement though still uncertain concerning its ground. At worst, it repeats the style of vapid, feel-good generalities and infuriatingly indistinct platitudes. At best, it oers some interesting ideas which hint at a nominalist approach. Other commentators feel that the activities described by Senge lack any clear philosophical background (Jackson, 1993b). It will therefore be interesting to see whether Senge ever does choose to articulate a clear social theory for his work and whether he will make the paradigmatic break with functionalism in so doing. Many of the ideas in Vennix (1996) parallel those of Senge, although he grounds them securely in the relevant literatures. He sees the goal of group model building as the creation of a shared description of a problem which can then act as a basis for action. His central interest in working with small groups and facilitating the creation among them of intersubjective meaning looks interpretive. Vennix's understanding of the work of Checkland and his general command of the `soft OR' literature reinforces the idea that he is attempting to step away from a realist approach. However, there are two important points to make about this impressive book. The rst concerns Vennix's championing of SD as a suitable tool to facilitate the negotiation of inter-subjective understanding. If he has indeed chosen an interpretive stance, then there is no argument available to him to justify the use of any particular modelling approach, all normative aspirations having been cast aside. Arguing for the continued use of SD retains an essentially normative, and therefore realist, view of the world. It is not consistent with to use one example of an interpretivist approach the `ethnomethodological indierence posture', in which description is the key (Coulon, 1995). In fact, Vennix is not confused on this point (Pers. Com., 1997) His use of SD is neither normative nor descriptive. Vennix is clear that he cannot impose SD on a group which has no appetite for. However, if that group is wrestling


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with certain types of problems and nds SD compelling and meaningful then he believes that it can be used as a tool to move the group towards a shared understanding. This stance is better thought of as `conditionally prescriptive'. Such a stance might seem to remove Vennix's ideas from the interpretive paradigm, locating them back into `Interactive SD'. But the situation is less clear and this brings us to a second point. Vennix appeals very briey to the ideas of Berger and Luckmann (1966) who view social reality as being constantly reproduced by human agents behaving according to interpretations of the world which are themselves shaped by that world. Vennix's uses this idea to justify the importance that he attaches to individual interpretations. It is the shared interpretation that the group members have of the world after a modelling process that is at the centre of Vennix's interests. He wants to get as close as possible to the ideas and attitudes of his group members so that in using SD they have truly changed their interpretations of the world, see it dierently and act accordingly. It is a view very similar to that of Senge but much better grounded. Both this approach and Berger and Luckmann's ideas are problematic. However, it is this attachment to the interpretations of the group that tips the scales and makes us conclude that the most useful way of seeing Vennix's more recent ideas is as HD. Interpretivism in SD practice is weakly declared in the Modelling as Learning approach described by Lane (1992) who certainly suggests that it oers the best path for advancing that approach. Such advance may be seen explicitly in Lane and Oliva (1998). They describe carefully how the interpretivism of SSM might be used to generate multiple perspectives on a situation before studying it further using SD. Although the approach that they outline synthesises the methods of both SSM and SD, to ensure consistency at the level of theory they adopt completely the nominalist position of the former. To some extent they avoid the criticism concerning the advocacy of SD to which Vennix's approach is open. However, the authors' discarding of the normative argument does require them to work very hard to describe why it would be natural and expected for a group to choose to use

the tools of SD. Perhaps this paper is best seen as an intellectual marking out of a clear and coherent interpretivist position for system dynamicists. It seems doubtful that its convoluted argument will be attractive to many in the eld. Nevertheless, this paper is perhaps the clearest statement of an HD approach. 6.3. `Modelling as radical learning' The form of Agency Dynamics christened here as `Modelling as Radical Learning' implies the use of SD modelling to further communicative competence within groups. Considering its lineage, perhaps we should not be surprised that SD has not yet drunk at the well of neo-Marxist communication theory (Lane, 1994b). But any modelling which operates within organisations without taking an overt political stance on the ideological superstructure of society in general does not escape politics; it merely buries its stance. When we articulate mental models are they those of alienated prisoners? Do microworlds free people, or help convey a management ideology more eectively? Clearly the issues concerning power, ideology, coercion and communication addressed in the radical humanist paradigm are just as relevant for SD. Unlike HD, this is not a form of SD practice that we would seriously argue exists at present. Rather, it is a possibility suggested by both the social theoretic literature and by developments in the systems literature. But it is illuminating to wonder how dicult is might be to re-craft SD within the radical humanist paradigm. Inuences from existing practice might support such recrafting (see Fig. 4). For example, Interactive SD oers much useful experience. We might also recall that Forrester's New Corporate Design proposed that the widespread use of SD insights in an organisation would have anti-authoritarian eects, oering new freedoms to sta (Forrester, 1965). Hence the very basic, `Initial SD', concepts of the eld could also be advanced in developing such an approach. A great deal of theoretical and practical work would need to be done to develop such an ap-

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proach but the highly innovative idea of mixing SD with Critical Theory could produce exciting and eective results. At the very least, any attempt at such development would oer a stern challenge to some of the platitudes on the subject of individual empowerment that are too lightly used at present and would sharpen the eld's aspirations in this direction. 6.4. The potential contribution of agency dynamics In closing Section 6, two observations must be made about the contribution to SD that might be derived from acknowledging the idea of Agency Dynamics. The rst concerns the necessity of such acknowledgement whilst the second addresses the peer support available. Lane (1994a) sees the general inability within SD to choose between a weakened engagement with functionalism and an embrace with interpretivism as a fundamental problem for the eld, a view conrmed by Jackson (1993b, 1994). It may be necessary to choose one's approach if the criticisms of those such as Keys (1990) are to be answered. However, we should not underestimate the careful theoretical eorts needed; Lane and Oliva (1998) demonstrate the care needed when attempting to re-ground the eld in another paradigm. Nevertheless, a second point, and one to be emphasised, is that work inspired by subjectivist ideas is already under way in other elds. See, for example, Lane's description of `soft' OR approaches (Lane, 1994a) particularly the attempts of Ulrich (1983) and Flood and Jackson (1991) to operationalise some of Habermas's ideas, and the account of Walsham (1993) of the application of an interpretive approach to information system design. The study and application of subjective approaches to management science is an active area of research. Furthermore, SD is being drawn into the discussion by commentators some of whom do not have a full command of the ideas of the eld. A System Dynamics/Agency Dynamics debate would certainly inject into the eld the `essential tension' that Maloney (1993) feels that it lacks! Agency Dynamics may not itself be adopted by many but the debate would enrich the eld.

7. Comments and conclusions In closing this paper we rst comment on the nature and relevance of the above analysis. We then consider what that analysis means by proposing three competing conclusions that could be drawn. 7.1. On the analysis employed Many elements of this analysis may be disputed. Perhaps objections will be raised to the regions of SD practice dened above, or to their positions in Burrell and Morgan's schema. Readers may dispute the usefulness of the four paradigms, or question the coherence of the two axes which generate them. In response to such objections, we would appeal to a maxim from the OR community, `all models are wrong but some models are useful'. We are not immovable on the exact form of social theoretic analysis which might be utilised. However, some means of examining social theories is of crucial importance. There is the common argument that dalliance with theoretical issues is a modern equivalent of calculating the number of angels dancing on the head of a pin, that we would be better obeying the exhortation to `just get on with it' (cf. Richmond, 1994). Now `getting on with it' is perfectly possible for some gifted individuals. But the elds of SD and OR have both been criticised for not reecting on such individual's skills so that they might be transferred to new practitioners (see Lane, 1994a; Eden and Sims, 1979). The `pragmatic' rejection of theoretical issues, ``abandons the hope of developing management science as an intellectual discipline, the main tenets of which can be passed on to `apprentices''' (Flood and Jackson, 1991, p. 47). Similarly, ``practice which is not reective about the ideas upon which it is based will abandon the chance to learn its way to better ways of taking action'' (Checkland and Scholes, 1990, p. xiv). To demonstrate the benets of addressing social theoretic issues, we now discuss three dierent and competing conclusions that might be drawn from the analysis described in the previous two sections. These conclusions concern the appropri-


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ate social theory of SD and they are mutually exclusive. In each case we state and justify the conclusion and then consider some implications of adopting it. The last conclusion is a bold conjecture which establishes an innovative agenda for future research in this area. 7.2. Conclusion 1: Clarity and security in functionalist sociology A rst possible conclusion from our analysis is that SD is grounded in the functionalist paradigm. Certainly the social theoretic paradigm under which past and current SD practice can most readily be seen to have been applied is functionalist sociology (see Fig. 4). This is a secure home for the eld since functionalist sociology remains ``the dominant framework for the conduct of academic sociology and the study of organisations'' (Burrell and Morgan, 1979, p. 25). Operating within this paradigm brings recognition and credibility to our work from a variety of other social sciences. What are the implications of this conclusion? They are threefold. Firstly, we would have to reject the claimed existence of SD practices within other paradigms by labelling them as distracting errors. We might wish to take their interesting aspects and recast them within a functionalist frame but fundamentally we would see them as mistakes and delusions. The recommendation would be that practitioners return to the functionalist fold. Since considerable breadth of interpretation is seen even within functionalist sociology, a second implication concerns that spread of practice. Initially, SD was practised in a way consistent with a mixture of ideas from social systems theory and integrative theory. Over time the eld extended further in two dierent directions. The interpretive division underlying Broad SD can be seen as arising from utterly reasonable interpretations of Forrester's functionalist ideas. Interactive SD and Austere SD reveal new contributions and further extend the implied social theory of SD but these regions may be viewed simply as innovative interpretations of the original ideas. Therefore, the subjective wing of Broad SD and Interactive SD can be seen as arising from an evolutionary re-

crafting and development of the eld's early assumptions. Hence Keys` almost revolutionary view of these developments is false. Furthermore, the Interactive SD region of activity indicates the eld's ability to engage successfully with pluralist contexts. Interesting as the above account of the eld's development may be, we are nevertheless able to deduce that this spread of schools of practice is relatively unproblematic because all are within the one paradigm. The third and last implication is that SD oers a modern, practical, relevant and empirically based approach which is at its best and most condent when it operates as a mixture of ideas from social systems theory and integrative theory, and even interactionism. We may observe that, ``with the exceptions of economics, the social sciences which have best survived the antipositivist challenge have been those which have thrown o Vienna Circle-style methodological restrictions while going on to build formal models around `softer' data'' (Collins and Waller, 1994, p. 22). Perhaps Policy Engineering and the wing of Broad SD which places a positivistic style of scientic thought at the heart of its concept of `condence' are appropriate for those wishing to contribute to mainstream economic theory. However, we might recommend that the social conversation view of condence and hence the schools of practice to the subjective side of functionalism which aim to mix technical and softer considerations have the most to oer those making more general attempts to create formal theories about social systems and that for this project the SD approach continues to have a great deal to oer. 7.3. Conclusion 2: Re-craftable method A second possible conclusion is that SD is attached to no unique social theory. This view is provoked by the range of practice described in our analysis. Certainly some of the areas are theoretically unclear, provocative ideas more than practically tested approaches. The evidence for this conclusion is therefore not overwhelming but the attempts to utilise most of Forrester's assumptions within other paradigms does lead one to wonder

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whether those assumptions are denitively and unambiguously xed in one paradigm. This conclusion must provide an explanation for the majority of practice being located within functionalism. A possible argument would require us to accept that although Forrester advanced certain initial ideas for SD these operate only at the level of tools, techniques and methods, to reuse the framework of Eden (1989, 1990). Some of the grounding assumptions of the eld may appear to operate at the level of social theory but these are frequently capable of dierent interpretations or are contradicted or hedged with uncertainty in other parts of the literature. So, as created, the eld contained assumptions which could support dierent interpretations regarding its social theoretic stance. Now functionalist sociology was and is the paradigm naturally alighted upon by researchers who are either not aware, or do not accept, that other scientic approaches are possible. That functionalist sociology proved to be the dominant interpretation of Forrester's ideas, attracting the unacknowledged support of the eld's earliest members, is therefore hardly a mystery; SD was innovative and risky enough without burdening Forrester's program with a research orientation that was also unusual. The predominant application of SD within functionalist sociology may therefore be explained as an historically and institutionally contingent interpretation of ideas which actually can be utilised in dierent ways. If SD consists only of tools, techniques and a method then what are the implications? Returning to Keys (1988), we may not deduce that SD is an amalgam of objective and subjective approaches or that it breaks through paradigm incommensurability. Such attributes are simply not appropriate for a body of ideas which has no clearly articulated and unambiguous extension into the level of theory. If SD is no more than a method then each case of its practical application must have added to it a social theory. The implication of this conclusion is therefore that practitioners must become explicitly aware of, and consistent with, the social theoretic axioms implicit in their SD activities if a coherent scientic approach is to be sustained. If dierent social theories may be added, then it may be appropriate for SD to be grounded in other

paradigms, as proposed in Section 6. Awareness, or conscious choice, of the paradigm in which the method aspires to operate at any given time is vital to any such applications if scientic consistency and coherence are to be maintained. Conclusion 2 requires practitioners to examine or choose their social theoretic stance each time they employ the method of SD in an actual social context. What will happen if they do? Many will remain somewhere within the paradigm of functionalist sociology but this will be a conscious choice, taking up the implication of this conclusion. Others may see that SD can, perhaps, be even more exible than previously thought if only it is tried out in dierent forms in a rigorous, scientic way. Either response would advance a purpose of this paper: to encourage practitioners to reect upon and to explicate the social theory of their practice. 7.4. Conclusion 3 (a bold conjecture): Formal approach to dissolving dualisms The third conclusion diers from the rst in that it accepts the varied applications of SD across Burrell and Morgan's framework. It also diers from the second in that it does not deny SD any social theoretic status. Put briey, this conclusion is that the feedback perspective of SD relates the eld to those modern social theories which seek to dissolve the objective/subjective divide and that it provides a formal approach to such sociological analyses. This conclusion does not imply that SD by itself breaks through paradigm incommensurability, rather that it is at the more formal end of a range of social theories that have attempted to do this. However, this conclusion, whilst not supporting SD normatively, does privilege SD by suggesting that it can contribute to the further development of these theories in a uniquely powerful way. This conclusion requires us to engage with more contemporary social theorists. The justication will only be sketched very briey here and must therefore be seen as a bold conjecture. A detailed account must await further research and subsequent publications.


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Although the subjective/objective divide has already been described as bundling together various strands (see Fig. 1), we may extend things further by relating this axis to other debates. Various `dualisms' in social theory treat `individual/society', `micro/macro' and `agency/structure' (Layder, 1994). Though less obviously grand than Burrell and Morgan's strands, these dualisms have similar concerns. They label distinctive means of understanding the social world. We might work at the micro level and seek to understand how individuals voluntaristically act as human agents, enacting and continually creating the social world by ascribing meaning to their actions. Alternatively, we may investigate at the macro level, seeking to understand how objective structures give rise to conditions which bound, constrain and even determine human action. Thus far we still seem to be in Burrell and Morgan territory. The key change is to observe that many social theorists see these two views as dialectically co-existing and interrelated. It is this step that truly announces the third possible social theoretic grounding for SD. In making this step we are not entirely rejecting Burrell and Morgan's framework; whilst critiquing the concreteness of their division, we do accept that there is a distinction to be made. However, we see this distinction as describing extremes of a dialectical activity which encompasses both human agency and social structure. The notion that there is a dialectical relationship between agency and structure is an old one. Durkheim, Marx and Parsons certainly concentrated on understanding the facticity and objectivity with which the social world presented itself but in dierent ways these theorists acknowledged the dialectical relationship between agency and structure, even though they ultimately gave priority to the latter. However the social theorists most relevant to Conclusion 3 are those who attempt to treat equally both aspects of the agency/ structure dualism and who seek to give an account of the dialectical process at its heart. Berger and Luckmann (1966) propose that individuals apprehend the world using internalised typicatory schemes and enact their resulting interpretations to produce an externalised, intersubjective world which, over time, takes on objective characteristics

which are themselves internalised. Giddens' `Structuration Theory' is concerned with the overlaps between dierent approaches and seeks to dissolve dualisms and synthesise (Giddens, 1976, 1984). Habermas's Theory of Communicative Action attempts to hold in balance both an objective systems theory akin to Parsons and an account of language and meaning in the style of Mead (Habermas, 1968, 1981a, b). Systems theory is also used by Luhmann to describe the relationship between processes of communication (his social system) and individual consciousness (`psychic systems') using the concepts of autopoiesis (Luhmann, 1984). Coleman's work is much more formal and relates social phenomena at the micro and macro levels using propositional models based on a rational choice theory of action (Coleman, 1990). This theory has anities with the work done on relating the behaviour of individuals, organisations and populations of organisations (Hannan and Carroll, 1992). Again there is concern to understand the micro/macro linkage. There is no suggestion that the above theories are in complete harmony with each other (Habermas and Luhmann have clashed extensively) or that the links with SD are anything more than glimpsed. However, the above examples indicate that there are important areas of modern social theory which take a dialectical view of agency and structure. This is the appropriate territory for SD. The feedback perspective is a head-on attack on linear causality. It rejects extremes of many `dualisms' as forms of linear thinking and implicitly dissolves the distinction between them (Bowen, 1994; Lane, 1995c). Similarly, the handling of individual decision making and aggregation in SD can now be seen as a formal treatment of the micro/macro linkage. We must also be clear that the link between feedback thinking and social theories has been made before. The extensive study by Richardson (1991) claims that the feedback approach was used by Hegel, Mead, Dewey and others. However, these links relate primarily to past social theories. Conclusion 3 is distinctive because it relates SD to modern social theories and debates. Adopting Conclusion 3 does not, however, preclude the continued application of SD in a

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purely functionalist style. This is welcome, since this style best describes the location of most SD, be it GDS or the more traditional OR simulation modelling. Instead, the claim is that it is possible to extend SD beyond such useful work into new areas and derive new benets. The benets of adopting Conclusion 3 are twofold. Firstly, if accepted as being grounded in the dialectical theories described above, SD acquires a suite of fascinating phenomena to model and a highly developed social theoretic perspective. These may be theories populating and competing in an area of debate. But theoretical attempts to move beyond the paradigmatic closure that has been employed for most of this paper are becoming increasingly inuential in organisational studies (Willmott, 1990; Weaver and Giola, 1994). This is unquestionably an issue that is of interest to OR workers. More generally, there is no doubt of the importance of the agency/structure debate in social theory research. For SD to contribute to this debate would truly draw it into the centre of social science. The second benet of adopting conclusion 3 is that social theory itself acquires SD, a formal, propositional and deductive approach to understanding social phenomena. This is very dierent from most of the dialectical approaches described above, those being purely descriptive. Such work has been castigated for its looseness of style (Abell, 1994). The rich dialectical view risks being sidelined by more quantitatively grounded approaches if it cannot respond to the pleas of social researchers for more formal approaches (Coleman, 1990; Hage, 1994). Forrester's concept (Forrester, 1961) of `precise' meaning clearly stated is only one way of seeing how SD oers undoubted advantages to social researchers and is a response to these pleas. More theoretical work and specic modelling experiences performed in association with social researchers will be needed and these are by no means trivial tasks. But there is enormous potential for SD to contribute to and even to shape the agency/structure debate. Conclusion 3 is the preference of this author. Pursuing this new line of research would mark a distinctive expansion out of the purely engineering context which was the historic source of SD and

into organisational studies (a natural area of concern for OR) and into the realm of social research. What that realm still requires is, ``a systematic accounting of the dialectical relation between structural realities and the human enterprise of constructing reality in history'' (Berger and Luckmann, 1966, p. 186). I believe that the formal modelling of SD can provide such an accounting. In doing so, in providing a formal approach to the study of the linkage between micro and macro phenomena, SD brings a powerful OR modelling approach into the heart of social science and has the potential to contribute signicantly to it.

Acknowledgements This paper was completed whilst the author was a Visiting Scholar at the Department of Value and Decision Science, Tokyo Institute of Technology, in March, 1998.

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