%0 Journal Article %J Technology Innovation Management Review %D 2012 %T A Business Application of the System Dynamics Approach: Word-of-Mouth and Its Effect in an Online Environment %A Roman Wong %A Shirley Ye Sheng %K adoption %K modeling %K recursive relationship %K system dynamics %K word-of-mouth %X In this article, we illustrate the use of system dynamics modeling approach to study a complex system: word-of-mouth. Word-of-mouth plays an important role in reducing risk and uncertainty in purchase and consumption. Most of the prior research on word-of-mouth focused on studying either the factors that trigger consumers’ participation (sending or receiving) in word-of-mouth activities or the impact word-of-mouth information has on consumers’ buying decisions. The relationship between the two decision processes, however, is recursive and dynamic. Most prior studies have not focused on a recursive relationship. Our objective is to present a system dynamics model for the study of the relationship between the buying decision and the decision to participate in word-of-mouth communication. We also discuss how system dynamics modeling can be used in other complex problems in business such as the creation of a global business. %B Technology Innovation Management Review %I Talent First Network %C Ottawa %V 2 %P 42-48 %8 06/2012 %U http://timreview.ca/article/568 %N 6 %1 Andreas School of Business of Barry University Roman Wong is a professor in the areas of information systems and operations management at the Andreas School of Business of Barry University. He received his PhD in information systems from Southern Illinois University at Carbondale, and he received an MBA from the University of North Carolina at Charlotte. Before joining Barry University, he held a faculty position at the California State University at Northridge. His current research interests include the interrelations between the online review and product adoption processes and the development of innovativeness in emerging countries. %2 Andreas School of Business of Barry University Shirley Ye Sheng is an Assistant Professor of Marketing at Andreas School of Business of Barry University. She received her PhD in Business Administration with a Marketing concentration from Florida Atlantic University in the United States, and she received a Master of Science degree in Finance from Leicester University in the United Kingdom. Her research focuses on international marketing, consumer behavior, and marketing history. %R http://doi.org/10.22215/timreview/568