What is Simulation and How Can it be Used?

GoldSim is a simulation program. As used here, simulation is defined as the process of creating a model (i.e., an abstract representation or facsimile) of an existing or proposed system (e.g., a business, a mine, a watershed, a project, the organs in your body, the atmosphere) in order to identify and understand those factors which control the system and/or to predict (forecast) the future behavior. Simulation is an important tool because it allows you to ask “What if” questions about a system. That is, it provides a way in which alternative designs, plans and/or policies can be evaluated and compared without having to experiment on a real system (which may be impossible or impractical to do).

A few wide-ranging examples of how simulation can be used to ask such "What if?" questions in order to solve real-world problems in business, engineering and science include:

Strategic planning: By simulating the development, regulatory approval, and marketing of a new drug, you can determine a strategy that will maximize profits.

Manufacturing: By simulating the supply chain for a product, you can experiment with technological changes (e.g., improved communication) and changes in decision rules (e.g., ordering practices) in order to stabilize inventory levels throughout the chain.

Reliability and Systems Engineering: By simulating the components, processes, failure modes and events controlling a complex engineering system (such as a space system, a machine, or a large industrial facility), you can predict the reliability of the system, and modify the design so as to increase reliability and decrease the probability and/or consequences of failures.

Water Resources: By simulating the inflows and future demands on a water supply reservoir, you can optimize management practices to minimize the probability of needing to seek other sources and/or impose water use restrictions at some future date.

Environment: By simulating the performance of a proposed landfill, you can modify the design to minimize environmental impacts.

Resource Planning and Management: By simulating a natural resource (such as a forest), you can determine which combination of management practices (e.g., selective harvesting, development of recreational facilities) maximizes the use of the resource and best satisfies the various stakeholders.