Supporting Small Medium Enterprises Planning Through the Use of a Step-by-Step System Dynamics Model Building Process

21 Pages Posted: 6 Mar 2011

See all articles by Athor Subroto

Athor Subroto

School of Strategic and Global Studies; Departement of Management

Enzo Bivona

University of Palermo

Date Written: July 26, 2009

Abstract

This paper aims to support small medium enterprises (SMEs) in business planning through the use of system dynamics models. In particular, it has been hypothesized that through the use of a step-by-step system dynamics model building process SMEs entrepreneurs can better understand the net of cause-and-effect relationships underlying company financial and non-financial results. Such an approach also enables decision makers to improve their understanding about the figures portrayed in a balance sheet. In order to reach such a goal, this study has been carried out through the use of a case-study. The small company investigated is a leather handcraft operating in Indonesia. The paper makes explicit main feedback mechanisms underlying company customer base dynamics adoption process, production and inventory management policies, human resource management practice and machineries production capacity acquisition policy.

Keywords: System dynamics, Small medium enterprises, Accounting, Financial Report

JEL Classification: E30, M13, M41

Suggested Citation

Subroto, Athor and Bivona, Enzo, Supporting Small Medium Enterprises Planning Through the Use of a Step-by-Step System Dynamics Model Building Process (July 26, 2009). Available at SSRN: https://ssrn.com/abstract=1778082 or http://dx.doi.org/10.2139/ssrn.1778082

Athor Subroto (Contact Author)

School of Strategic and Global Studies ( email )

Gedung SKSG & SIL (Pascasarjana)
Jalan Salemba Raya No. 4
Jakarta, Jakarta 10430
Indonesia
+62213900538 (Phone)
+62213100059 (Fax)

HOME PAGE: http://sksg.ui.ac.id/

Departement of Management ( email )

Depok, West Java 16424
Indonesia
62 21 7272425 (Phone)
62 21 7863556 (Fax)

HOME PAGE: http://www.feb.ui.ac.id/

Enzo Bivona

University of Palermo ( email )

Viale delle Scienza
Palermo, Palermo 90128
Italy

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