Scroll down to study the 5 evaporating cloud diagrams, from the book.  You can also read this chapter (13) which explains the first cloud.

 Blank Cloud

Blank Cloud


 Buy or Build

Buy or Build

 Steve's first cloud

Steve's first cloud



 Underproduction: Change vs. don't change

Underproduction: Change vs. don't change

 overproduction: small or large spec

overproduction: small or large spec