Essays on Bullwhip

The bullwhip effect can be detrimental to the efficiency of a supply chain. Demand of a product may only slightly shift, but it can lead to a much greater shift in manufacturing a product. This is when the “variability in demand is magnified as we move from the customer to the producer in the supply chain” (Robert & Chase). It specifically relates to a lack of coordination in a supply chain as a company makes purchases from its suppliers more unpredictably than it sells to its customer (Mendelson & Bray, 2016). It also relates to a lack of coordination in the ...

Introduction

Every business takes inputs from the society and processes them into outputs for members of the society. The supply chain “is a set of entities that are involved in the upstream and downstream flows of products, services, finances and/or information from a source to a customer”. Supply chain management is the management across and within the network of upstream and downstream organisations of both relationships and flow of material, information and resources. The purpose of this paper is to critically analyse the supply chain systems of various companies in order to draw conclusions on how they operate. In order ...

Counter Measures to the Bullwhip Effect

Introduction The bullwhip effect is the unexpected distortion of the supply chain. It refers to the “variability of order rates” (Disney and Lambrecht, 2008, p. 3). This supply chain hazard has its roots in Jay Forrester’s Industrial Dynamics Theory of the late 1950s (Goldsby and Martichenko, 2005). Forrester was the first person to introduce the concept and simulate a model in 1961. There are many solutions to counter the bullwhip effect. The reason why there are many solutions to the bullwhip effect is because it is triggered by multiple causes. For instance, the most common cause is overreacting ...

Bullwhip Effect

Supply chain management constitutes of complex tasks and includes companies that transfer goods from initial raw material stage to finished goods to retailers. The most common reasons that supply chain companies stumble is when the customer demands and market conditions fluctuate or shift. The bullwhip effect is caused when supply chain companies are not able to manage their orders . The change in consumer demand and market fluctuations cause different supply chain companies to order more products/goods to achieve or meet the demand. The most common reason for the difference in orders is that companies base the demand for goods ...

Discussion and Review Questions Assignment 5

Discussion and Review Questions Assignment 5

Chapter 13 – Inventory Management

7. a. List the major assumptions of the EOQ model.

1. Each EOQ model describes one product. 2. It is necessary to know the information about annual demand. 3. The demand should be fixed and unchanged during the whole year. 4. The execution rime is also fixed. 5. EOQ will work if every order is taken in one delivery. 6. EOQ needs to have no quantity discounts. b. How would you respond to the criticism that EOQ models tend to provide misleading results because values of D, S, and H are, at best, ...

A phenomenon in supply chain by which the rates of orders vary as they move from one echelon of a supply chain hierarchy to the other is referred to as the bullwhip effect (Rong, Shen & Snyder, 2008). The variability for demand accelerates as one move from a lower supply chain level to the upper one. This continual change in the customer demand over the different levels of supply chain causes the variation in the price and amount of orders which are placed in the higher hierarchy of the SC. As a result of these variations, an organization’s supply ...