System Dynamics Model for Continuous Review Inventory System in Demand Shock Conditions

This paper deals with applying a control loop based on PID controller algorithm to dynamically setting the components of the continuous review system (Q-system) for inventory management to avoid demand shock unrequired influence on a customer service level. Through Vensim software platform, the system dynamic model of feedback system was developed, consisting of the Q-system for single echelon logistics and PID controller. Finally, operational performance results are analyzed using data of performed simulation experiments.