Abstract for: Using Difference Equation to Model Discrete-time Behavior in System Dynamics Modeling

In system dynamics modeling, differential equations have been used as the basic mathematical operator. Using difference equation to build system dynamics models instead of differential equation can be insightful for studying small organizations or systems with micro behavior. In this paper we explain how we can use difference equations to build system dynamics models. We illustrate the use of this method through its application to a case study in supply chain management.