Despite being the principal measure of elective performance in Great Britain's National Health Service, there is little on-the-ground awareness of the dynamics at play behind the referral-to-treatment (RTT) standard. Through a simple worked analogy, it is shown how this performance measure - calculated as the proportion of unresolved RTT pathways within 18 weeks from referral - is dependent on the interplay between elective demand and capacity. Bringing in activity (cost) and waiting list size, the presented theory unifies the five key components of the pathway dynamics for the first time within the published literature. A computer simulation model based on these principles is thereafter constructed as part of a more quantitative analysis using publicly available national data for 2017-2018. In this, referral rates and capacity are varied in line with a range of "what if" scenarios known to be of interest to service planners, with the effect on performance and cost objectively assessed.