Using System Dynamic Model for Predicting Inventory of Rice Necessity

Abstract

Abstract Indonesian government has an organization that aims to manage basic necessity nationally, especially for rice commodity. The organization runs in the form of a business entity and has a program making welfare of the poor people by providing rice assistance. There is still over stock and out of stock in inventory while organization distributes this relief. That matter creates unbalance between commodity in inventory and commodity in distribution incurring a large cost. Prediction model using system dynamic in this study was needed to control the inventory and reduce over stock or out of stock. Causal loop diagram was used to describe the relationship between variables in the system and simulation was run with stock and flow diagram. Simulation was done by benchmarking the actual and the simulation results. The model that was built, tested using the Mean Absolute Percentage Error (MAPE). Based on the simulation results, the values of MAPE are below 5%. This indicates that the model can represent the real system and can use to predict variable for the future.