As far as a single-input, single-output system's output signal is concerned, the complete output response can be thought of as the sum of two terms: the zero-state response and the zero-input response. The zero-state response (i.e., the response when all initial conditions are zero) is the product of the transfer function and an arbitrary input signal. The zero-input response (i.e., the response when the input signal is zero) is due to the stored energy in the non-zero initial conditions. Thus, transfer functions have no dependence on initial conditions, therefore transfer functions may be defined as the ratio of the output of an LTI system to its input in the complex frequency domain with zero initial conditions.
Given a linear time-invariant differential equation model, any non-zero initial conditions must be included when taking the Laplace transform of any derivative terms. This is how they end up in the system output signal as the zero-input response term. However, they end up dropping out of the response equation if set to zero, and only the transfer function and its accompanying arbitrary input signal remain.
Zero initial conditions can be created by using deviation variables, finding the zero-state response, then adding the initial conditions back to the zero-state response. Deviation variables can be created by subtracting the steady-state equation from the differential equation, and are often created by linearization of nonlinearities that are differentiable around the linearization point.
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