Schmidt, Dieter, "Computerbased Decision Support of the Strategic Planning and Strategic Management with System Dynamic Models Illustrated by the Example of the German Federal Railway", 1989

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The competitive situation of the German Federal Railway has visibly intensified due to the following factors: the way in which important customers (the coal and steel and fertiliser industries) are susceptible to crisis; the longstanding political favouring of road construction; the introduction of new technologies (video link-up, electronic mail etc.); and also the europeanisation of the transport market and the associated price decay (Duetsche Bundesbahn, 1987). The precarious financial situation, as well as growing pressure from the public, presents the railway management with the difficult task of, on the one hand, reducing costs, and on the other hand, of improving the standard of service offered. In order to be able to cope with this problem, it is necessary to identify and formulate corresponding strategies, against the background of existing strengths and weaknesses, as well as growing chances and risks arising from environmental development. Through the strategies, and through innovation, invention and reduction in costs, the railway can be developed from a bureaucratic institution to a modern and competitive tertiary sector company. Only in this way can the railway's ability to survive be secured in the long term (Zahn, 1988).This paper presents a system dynamics model, which portrays an important area of the federal railway. With the help of this model, the interrelations and mutual dependencies of this complex system are to be demonstrated. The model provides a valuable article in the field of strategic planning, in which strategic decisions, which are often based on uncertain information, can now be founded on a sound basis, and therefore, the decision process can be effectively supported.

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  • 1989
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