Start at Marketing and follow the arrows. First the narrative of the top two circles: R1 and B2:
1. As marketing increases, product sales increase (s). R1
2. As product sales increase, service quality decreases (o). B2
3. As service quality decreases, product sales decrease (s) B 2
4. As product sales decrease, marketing gets cut (s).
What will likely happen next? What would you predict? Because marketing is cut, sales will decrease. Eventually this will make the service quality better, but by then, the company may decide that this product just doesn’t work.
As the Service Quality degraded in B2 (o), two things are triggered: “Acceptable Service Quality” (aka what we currently consider acceptable) decreases (s) causing the received need to invest in this product to decrease, triggering a drop in investment for the new product. The other path from Service Quality decreases (o) as well ramping up the belief that this product is not going to sell.