Pipes and tanks

Pipes and tanks are good for moving fluid around and storing it for later use. You can see them in plumbing, oil refineries, chemical manufacturing, and water systems.

Pipes and tanks can be useful for thinking about anything that flows and can be stored or “banked” for later use. Many fields, like economics, business, and accounting distinguish between stocks (like water held in tanks) and flows (like water flowing through pipes). 

A stock is a quantity measured at a specific point in time. A flow is an exchange where money flows from one party to another.

For example: your kitchen pantry is stocked with food. When you take it out to cook or make a snack, you’re creating a flow. In a relationship you build up a stock of trust and goodwill over time. When you ask for a favor, you’re making a withdrawal from that account.

Stocks can refer to anything that’s stored. It can refer to money in a bank, an investment portfolio, inventory in a warehouse, or information stored in a database. Flows refer to any kind of deposits and withdrawals, like earned interest, dividends, items shipped and received from a warehouse, or data being input or accessed and used by customers.

Can you look at your situation in terms of stocks and flows? How are the stocks stored, and how do flows move through the system? What stocks do you have available to you? Can you make more deposits? What can you withdraw? 

See also: Flowchart, Causal loops, Tube map.


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