CHAPTER 13
Judging Model Validity

The significance of a model depends on how well it serves its purpose. The purpose of industrial dynamics models is to aid in designing better management systems. The final test of satisfying this purpose must await the evaluation of the better management. In the meantime the significance of models should be judged by the importance of the objectives to which they are addressed and their ability to predict the results of system design changes. The effectiveness of a model will depend first on the system boundaries it encompasses, second on the pertinence of selected variables, and last on the numerical values of parameters. The defense of a model rests primarily on the individual defense of each detail of structure and policy, all confirmed when the total behavior of the model system shows the performance characteristics associated with the real system. The ability of a model to predict the state of the real system at some specific future time is not a sound test of model usefulness.

THE validity (or significance) of a model should be judged by its suitability for a particular purpose. A model is sound and defendable if it accomplishes what is expected of it. This means that validity, as an abstract concept divorced from purpose, has no useful meaning. What may be an excellent model for one purpose may be misleading and therefore worse than useless for another purpose. What then are the standards for judging the models discussed in this book?


13.1 Purpose of Models

The purpose of industrial dynamics models is to aid in the design of improved industrial and economic systems. How are we to judge if the models are suitable for this purpose? The ultimate test is whether or not better systems result from investigations based on model experimentation. By this criterion, the validity of industrial dynamics models is not separable from the effectiveness of industrial dynamics as total viewpoint and discipline. The pertinent test is that of utility in improving management practice. Any new approach to management problems will be on probation until this test is passed.

The evaluation of improved managerial effectiveness will almost certainly rest on a subjective judgment rendered by managers in regard to the help they have received. Objective, noncontroversial proof of the effectiveness of an experimental system design using models is most difficult to conceive. Who is to say unequivocally that a superior manager is more successful because of a methodology and not because of the judgment and skill which he must also possess?

Although industrial dynamics in its entirety will ultimately be judged by the management change it creates, this does not serve the interim purpose of judging a particular investigation as it progresses. The ultimate test is too remote to be a guide for current work. We then attempt

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