Stock and Flow Diagrams: Visualizing How Things Accumulate and Move
Core Framework of Systems Thinking by Donella Meadows
In the world of systems thinking, complexity often arises not from individual parts, but from the interactions between those parts. To truly understand how systems behave — whether it’s a business, an ecosystem, or a supply chain — we need to see how things accumulate and move over time.
This is where Stock and Flow Diagrams become essential. They are the visual foundation of systems thinking, allowing us to map, understand, and influence the dynamics of complex systems.
🔍 What Are Stock and Flow Diagrams?
A Stock and Flow Diagram is a graphical representation that illustrates:
Stocks (Levels): The things that accumulate over time — like money in a bank account, water in a reservoir, or inventory in a warehouse. Flows (Rates): The movement of resources into or out of stocks — like deposits or withdrawals, rainfall or evaporation, and product shipments or sales. Core Components:
Represent the current state of a system. They are accumulators; they build up or deplete based on inflows and outflows. Represent the rate of addition to a stock. Examples: Sales revenue, water filling a tank, new employees hired. Represent the rate of subtraction from a stock. Examples: Expenses, water draining from a tank, employee turnover. Represent the variables or conditions that affect the rate of flows. Examples: Interest rates, market demand, seasonal changes. Show the causal relationships between elements. They indicate how changes in one part of the system impact another. 🖥️ Why Use Stock and Flow Diagrams?
Stock and Flow Diagrams allow us to:
Visualize Accumulation Over Time You can see how small inflows over time lead to large stocks (e.g., savings account growth). Understand System Behavior Helps identify delays, feedback loops, and bottlenecks. Test Scenarios and Predict Outcomes You can model changes (e.g., faster inflow, reduced outflow) to predict how the system will behave. It becomes clearer where a small adjustment can create significant change. 📈 Basic Example: A Simple Bank Account
Let’s visualize a bank account using a Stock and Flow Diagram:
Stock: Bank Account Balance Inflow: Deposits (monthly salary, interest payments) Outflow: Withdrawals (bills, expenses) If the deposits exceed withdrawals, the account balance accumulates. If the reverse is true, the balance depletes. This simple visualization allows you to see where adjustments are needed to build savings or manage debt.
🚀 Real-World Applications of Stock and Flow Diagrams
1. Supply Chain Management
Stock: Inventory in a warehouse Inflow: New product manufacturing Outflow: Customer sales or damage Converter: Market demand, lead times This helps managers balance inventory, avoiding both overstock and stockouts.
2. Human Resources Management
Stock: Number of employees Outflow: Resignations, retirements Converter: Job satisfaction, market competition HR teams can forecast workforce changes and adjust hiring practices accordingly.
3. Water Resource Management
Stock: Water level in a reservoir Inflow: Rainfall, river inflow Outflow: Evaporation, water usage Converter: Climate conditions, water consumption rates Governments and environmental agencies use this to predict droughts or flooding and manage water distribution.
🔄 Dynamic Behavior: Stocks Create Delays and Oscillations
One of the critical insights from Stock and Flow Diagrams is that stocks create delays.
When inflows change, the effect is not immediately visible in the stock. This delay can cause oscillations (up and down swings) if the system tries to overcorrect too quickly. For example, if a business suddenly increases production, the inventory stock rises. However, if demand doesn’t match that production speed, it leads to excess stock — triggering a reaction to cut back on production. This oscillation repeats if the system is not balanced correctly.
🎯 How to Build a Stock and Flow Diagram
What are you measuring over time? Inventory? Cash? Population? Determine the Inflows and Outflows What adds to it? What subtracts from it? Map Converters and Connectors What variables influence the flow rates? Use symbols for stocks (rectangles), flows (arrows), converters (circles), and connectors (dotted lines). What happens if you increase inflow by 10%? What if you slow down outflow? 💡 Key Takeaways
Visualize Complex Systems: Stock and Flow Diagrams help you see how resources accumulate and deplete over time. Find Leverage Points: They make it easier to identify where a small change can have a big impact. Anticipate Delays: Stocks create delays that are often the root cause of oscillations and instability. Avoid Reactive Management: Instead of reacting to problems, you can predict and prepare for changes. 🧭 Final Reflection: Mapping is Mastery
In systems thinking, understanding how things accumulate and flow is the foundation of mastering complexity.
“If you can map it, you can manage it.” When you visualize a system with a Stock and Flow Diagram, you move from guessing to knowing, from reacting to anticipating, and from patching symptoms to addressing the core structure.
Stock and Flow Diagrams: Notation and Standards
Stock and Flow Diagrams (SFD) are fundamental tools in Systems Thinking for visualizing how resources, information, or materials accumulate and move through a system. They are used to map the structure of a system and to understand its behavior over time.
If Causal Loop Diagrams (CLD) show the relationships and feedback loops, Stock and Flow Diagrams (SFD) provide a more granular look at the quantitative changes in those elements. They help you see where things are stored (stocks), how they move (flows), and where delays or accumulations occur.
📌 Basic Notations in Stock and Flow Diagrams
1️⃣ Stock (Level or Accumulator)
Represented by: Rectangles Definition: Stocks are the accumulations or quantities of something at a specific point in time. Stocks change only when there is a flow entering or leaving them. They represent the current state of the system. Examples:
2️⃣ Flow (Rate of Change)
Represented by: Arrows with valves Definition: Flows are the rates of change that increase or decrease the stocks. Flows are usually labeled with action words like Add, Remove, Deposit, Withdraw, Production, Consumption, etc. Types of Flows:
Inflow: Brings resources into the stock → Represented with an arrow pointing into the rectangle. Outflow: Removes resources from the stock → Represented with an arrow pointing out of the rectangle. Examples:
Production rate (inflow) and sales rate (outflow) in a warehouse. Birth rate (inflow) and death rate (outflow) in a population model. Income (inflow) and expenses (outflow) in a financial model. 3️⃣ Connector (Information Link)
Represented by: Dashed arrows Definition: Connectors show the influence of one element on another, typically from a stock or flow to a flow or decision point. They do not represent physical movement, only information or dependencies. Example:
4️⃣ Cloud (Source and Sink)
Represented by: Cloud shapes Definition: Clouds indicate the boundaries of the system. They are the sources where flows originate and the sinks where flows end. A source cloud represents infinite supply, and a sink cloud represents infinite capacity for removal. Example:
For a water reservoir system: Rainfall might come from a “source” cloud. Evaporation might flow into a “sink” cloud. 🔄 Visual Representation of Notations
🎯 Example of a Stock and Flow Diagram
Imagine a Warehouse Inventory System:
Stock: Inventory of products in the warehouse. Inflow: New stock coming in from suppliers. Outflow: Products sold to customers. Connector: Inventory level influencing reorder rate. Source & Sink: Supplier (source), Customers (sink). 🧭 Key Principles in Stock and Flow Diagrams
Conservation Law: The change in stock is equal to the inflows minus the outflows. Accumulation: Stocks accumulate over time, even if inflows and outflows are not visible. Delay Representation: Stocks introduce delays in the system. If there is an imbalance in inflow and outflow, the stock level will reflect that over time. Behavior Over Time: SFDs allow us to simulate how a system behaves over time, making it easier to predict bottlenecks or shortages. 🚀 Why Use Stock and Flow Diagrams?
Visual Clarity: Makes it easy to understand where things accumulate and where they drain. Decision Support: Helps identify leverage points where changes will have the most impact. Scenario Analysis: Enables simulation of what happens if inflows or outflows change. Avoid Short-Term Fixes: Shows the impact of adjustments on the whole system, not just isolated parts. 
Stock and Flow Diagrams
