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What Is A 'Stock'? (Systems)

A Stock, in the systems sense, is a pool of resources.

By following the Flow, you'll find where resources pool together.

To increase the stock, increase the Inflows and decrease the Outflows. If you want to decrease the stock, do the opposite.

Find the Stock, and you'll find resources waiting to be used.

Josh Kaufman Explains 'Stocks'

Follow a system's Flows, and you'll inevitably find places where resources tend to pool together.

In this case, a Stock isn't a certificate of business ownership-it's a pool or holding tank of resources.

A bank account is a good example of a Stock: it's a pool of money waiting to be used. Inventories, queues of customers, and waiting lists are also examples of Stocks.

To increase a stock, increase inflows and/or decrease outflows. If you want to increase the size of your bank account, put more money in and take less money out. If you're building cars and you're consistently running out of engines, either slow down the line or add more engines to your inventory.

To decrease a stock, decrease inflows and/or increase outflows. If you have too much inventory, stop producing units or increase sales. If waiting lists are too long, increase throughput or reduce the number of people entering the line.

Find the system's Stocks, and you'll discover pools of resources waiting to be used.

Questions About 'Stocks'

• Where are the stocks in the system?
• Where do flows tend to accumulate, and why?

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"Goods in any storehouse are useless until somebody takes them out and puts them to the use they were meant for. That applies to what man stores away in his brain, too."

Thomas J. Watson, former president of IBM

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