The utility of a system model depends not on whether its driving scenarios are realistic but on whether it responds with a realistic pattern of behavior.
Similar system structures exhibit similar system behaviors. Similar feedback mechanisms imply similar dynamics.
System behaviors can often be surprising. Naive policies on such systems can result in counterintuitive results.
Systems always change. They do so in different ways and different scales and time.

The Methodology

Systems dynamics models explore possible futures and ask what if questions. We can test the value of a model by asking ourselves the following:
- Are the driving factors likely to unfold this way?
- If they did, would the system react this way?
- What is driving the driving factors?
We model the dynamics of a system in two ways
- Black Box - understand the behavior of a system from the outside.
  - In particular, we examine the relation between the system’s inputs and outputs
  - In a black box analysis, it is unclear how outputs are derived from inputs.
- White Box - understand the behavior of a system form the inside — perceiving it as a system of subsystems.
  - It aims to understand how processes inside the system operate
- We can apply black box analysis recursively when doing white box analysis. Each subsystem is a black box until we need to examine the processes ¹ by using white box analysis. Then, we re-examine how the whole is formed from its individual parts.

The change of a system can be analyzed using time series analysis. Numerical Methods are used to perform analysis on a complex system.

System Processes

For all systems to do work, they require work and energy. It is the flow of energy which facilitate the dynamics of the system — from how it changes, sustains itself and degrades over time.
- Progressive Changes in the system require a flow of energy and work to be done.
- Regressive Changes result from the irreversible loss of energy.
Systems follow the Laws of Thermodynamics.
If permissible (i.e., if a channel exists), Energy flows from high potential concentration to low potential concentration
- The difference between potential concentrations is termed the Gradient.
Entropy means that there is always energy loss
- As a corollary — eventually all systems degrade unless they have a continuous influx of energy to do work and repair damage (which is also impossible due to entropy).
- Another corollary — no system has 100% efficiency. dd
There are no closed systems, except for the universe itself. Any relationship involves transfers of energy, matter, or messages, and the input involves some kind of output.
Any minimally complex system must always be subject to the flow of energy; otherwise the processes of natural decay and disorganization will ensue.
A critical aspect of understanding adaptive dynamic systems is understanding the propagation of change (information) in the environment
- Change propagates both temporally and spatially.

Thresholds are tipping points where the dynamic behavior of a system suddenly modifies in a manner out of all seeming proportion to the incremental change.