We recently posted a comparison chart of how process modeling, Social Network Analysis (SNA), and Value Network Analysis (VNA) are different. People sometimes also ask how is System Dynamics Modeling different from Value Network Analysis? 

The below example is not VNA. In fact, it is a particularly overwrought example of a system dynamics model has been floating around the Internet since it was first blogged by NBC's Richard Engel. More recently it was lampooned by the New York Times

Anything this complex might be useful for an analyst or a project team running scenarios - but should never be used as a general communication device. In value network modeling we encourage people to leave the complex visuals in the hands of the analysts. For general communication, simpler views with fewer nodes and links are better to make a point. At this level of visual complexity indicators and metrics are far more helpful to aid decisions.

While it is always fun to poke fun at bad examples, there is no question that System Dynamics is a powerful modeling tool that brings sharp insights into complex systems. It deals with internal feedback loops, stocks and flows, and time delays that affect the behavior of the system over time. Originally developed inthe 1950s to help corporate managers improve their understanding of industrial processes, system dynamics is currently being used throughout the public and private sector for industrial design as well as policy analysis and design. It is very useful for understanding how even seemingly simple systems display baffling nonlinearity and repetitive patterns.

System Dynamics modeling and value network analysis are complementary methods but very different. Boeing uses both approaches together as part of their Lean+ toolkit. They use system dynamics modeling to define the complex behaviors of the system and then engage managers in value network modeling to define the roles and interactions that are required for the system to function well. In this image Bob Wiebe, Dan Compton, and Les Music reference a system dynamic model that was used as a guide for the more detailed role-based value network map to the right. You can learn more in the Boeing Frontiers article, Testing the Limits. See the Wikipedia article on System Dynamics for some great animated examples.

So how is value network modeling different? Here is a simple comparison chart of the two methods. System Dynamics can be used to model work processes and human interactions but rarely shows them together. It is notablethat System Dynamics has a pretty steep learning curve, while the basics of value network modeling typically can be mastered in a shorter span of time. Thus System Dynamics is more of an "expert" tool while VNA is a tool for practitioners and managers.

System Dynamics modeling applications are some of the many applications that are compatible with the Value Network Insights application. 

For more on Value Networks see:

At first glance people often confuse Value Network Analysis (VNA) with Social Network Analysis (SNA). Or they think it is just a different, somewhat messy way perhaps, to model business processes. However, these three approaches are actually quite different. Below is a simple comparison chart. 

Comparison Chart of Business Process,
Social Network Analysis, and Value Network Analysis

Business process modeling has of course been used extensively for the last two decades. More recently people have been discovering social networks. Technology companies are jumping on the bandwagon offering social network visualization and analysis tools. Typically these offerings pull data from email or collaboration platforms to show how people are interacting.

However, even using both of these methods still does not achieve true integration of processes and human interactions. They were simply never designed to work together - and come from two very different theory bases. Only value network modeling brings together human interactions and business transactions into one dynamic model. The more comprehensive theory base of living systems paves the way. The result is an intuitive and friendly way for people to quickly map out their work as a whole system. This brings forward fresh insights, powerful whole system indicators, and predictive analytics that simply are not possible with other approaches.

Use the three approaches together

The Value Network Insights application supports business process modeling as a human-centric activity. The sequencing feature of the application provides a ready link to other business process tools. Existing data from workflow and process tools can be pulled into the Enterprise Edition to reveal the hidden network patterns of process performance. Predictive analytics show processes at risk. 

Social Network Analysis is also supported with the Value Network Insights application. Data for individual participants generates Collaborative Network visuals in Visio and PowerPoint, and Comprehensive Reports about how well your social networks support your business activity. Data can also be exported to other SNA applications if desired.

Finally, Value Network Insights generates the unique perspectives and reports of the role based value network. No other business modeling tool provides value network visuals and analytics. It is truly the "next generation" way of modeling business process networks.

All three modeling methods are powerful and useful ways of understanding business performance. With the power of value network modeling these three methods are integrated for a simple, powerful, and elegant way to achieve top business performance.

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Learn more about Value Network Analytics:

This 3.5 minute video is a high-level look at the Value Network Insights Professional Edition. See the application interface, reports generated, and more.

According to analyst firm, Gartner, Inc. CIOs see a very different future for IT by 2013. That future is based on innovation, fueling competitive advantage, and strong customer growth. To lay the foundation for the future, however, requires taking action today.

The top three priorities of 2010, according to Gartner, are to improve business processes, increase the use of information and analytics, and reduce enterprise costs. These business performance priorities are tightly linked to a technology environment where CIOs are increasingly interested in "lighter weight" solutions. The same Gartner report noted that CIOS consider their top three strategic technology priorities to be virtualization, cloud computing, and web 2.0.

Value Network Insights™ Enterprise Edition is an essential piece of the CIO puzzle for tackling all three business priorities. It also offers the advantage of being a "lighter weight" SaaS solution that augments and enhances existing applications.

Improving Business Processes

Value Network Insights™ brings greater resilience and flexibility into business processes. It is an ideal approach for organizational redsign and managing complex processes and work environments by:

• Defining the landscape of human roles, interactions, and transactions that support processes
• Revealing the hidden network patterns the drive business process performance
• Providing predictive intelligence for workflow performanced

Value Network maps easily convert to value stream or swimlane diagrams, then process maps and workflow. The result is dramatic improvements in process performance by better integrating critical human interactions. Read more on Value Network Insights for Business Process.

Increasing the use of information and analytics

Value Network Insights™ uses existing data for predicting and optimizing performance. Custom Prediction Reports include data, spreadsheets, and additional charts for in-depth analysis.

With no additional IT installation you can achieve continuous monitoring for network-centric business operations, operational KPIs, and metrics. Empower line-of-business users to proactively and rapidly respond to ever-changing business conditions. Minimize reliance on IT with self-service, interactive Prediction Reports. Users can customize them for their day-to-day work and specific operational KPIs and metrics.

Closed-loop business performance optimization – Identify and customize operational network KPIs and metrics. Allow visibility into operations performance at transactional and KPI levels. Understand and perform root-cause analysis. Drive insight to corrective action. Read more on Predictive Analytics.

Reducing enterprise costs

Value Network Insights™ provides for a very cost-effective, low-risk, and rapid deployment. There is no role-based pricing. Minimize IT effort and resources with a pre-configured software solution from a single vendor that is easy to deploy, manage, and maintain.

The SaaS advantage

Value Network Insights™ Enterprise Edition is a SaaS Solution. The heart of the application is the Value Network Insights™ “kernel” that provides the key data model, conversion, and analysis functionality for creating a value network-centric view of organizational information. Value Network Insights™ can be installed as an enhancement to existing BI solutions or connected into the corporate IS environment using APIs with your existing applications to create a BI solution.

In its server version (custom server installed inside the customer’s firewall) the full Value Network Insights™ SaaS solution is provided on a dedicated server and simply added into the company network. This ensures that all data can be securely handled in compliance with IT regulations. Extensions, enhancements, and automated APIs can easily be created and installed to embed the solution in the corporate IS environment. Read more on Technical Details.

See more on the Gartner Report.