Abstract:
System dynamics is a strategic approach for modeling complex systems and analyzing their behavior. Dynamic behavior in entrepreneurial system can be modeled using System Dynamics Approach and dynamic hypotheses about the system`s behavior can be proposed and tested using simulation and computer aided tools. However, as the review of literature shows, studies which link system dynamics modeling with entrepreneurship are rare and fragmented. This article presents a review of studies on the subject followed by integration and discussion on main research issues that have been the focus of previous studies. The main aim of this review is to categorize the available research related to the application of system dynamics modeling in entrepreneurship to integrate research and enable recommendations for future research. The Results reveal that the previous research could be categorized under a two dimensional taxonomy composed of level of analysis and level of modeling. The Level of analysis has three categories: micro level, meso level and macro level. The Level of modeling has six hierarchical levels. This study identifies several gaps in the literature and discusses the future directions in this field.
Machine summary:
"To date System Dynamics has been used in a wide range of domains such as corporate planning, public policy and policy design, medicine and biology, economic behavior, supply change management, energy and the environment, public management, decision making, software engineering and theory development in the natural and social sciences (Angerhofer & Angelide, 2000).
In sum, reviewing previous research with this level of analysis shows that previous studies have not paid much attention to the inherent internal processes of an entrepreneurial venture from the system dynamics viewpoint.
In the current business environment in which entrepreneurial ventures are encountered by rapid changes, modeling of changes in technologies, industrial trends, markets, customer preferences and other environmental factors using system dynamics modeling can develop worthwhile implications both at the meso and macro levels.
Inherent processes such as how a nascent venture survives and transforms during the first years of existence, how to learn to growth and renew itself in the face of the market changes are the issues which have not received any attention from system dynamics viewpoint and it depends on future planning in this area to develop a full-fledged research program on this topic and enhance the insights about these issues.
It is recommended that due to the fact that in the current business environment entrepreneurial ventures are encountered by rapid changes, future research concentrate on modeling the impact of changes in technologies, industrial trends, markets, customer preferences and other environmental factors using system dynamic modeling in order to develop worthwhile implication both at the meso and macro levels."