The impact of demand parameter uncertainty on the bullwhip effect

Pastore, Erica; Alfieri, Arianna; Zotteri, Giulio; Boylan, John E.

doi:10.1016/j.ejor.2019.10.031

Cited by 28 publications

(10 citation statements)

References 45 publications

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“…Supply chain effectiveness are influenced by demand unpredictability, particularly in the upstream echelons. The fluctuated demand tends to be intensified moving upstream in the supply chain called the bullwhip effect phenomenon, so that this tends to damage the service level to the final customers [9].…”

Section: Resultsmentioning

confidence: 99%

Forecasting of salt demand using ARIMA model to prevent the bullwhip effect in salt supply chain

Novianti

Utami

Dania

2022

J. Phys.: Conf. Ser.

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The volume of imported salt contributed roughly up to 50.29 percent in Indonesia. However, until the end of 2020, salt from domestic farmers reached 2.89 million tons. Based on these conditions, it is necessary to plan how to expand the distribution of local salt. Not only does distribute the salt to the domestic market, but also exports it, so the stock of salt does not accumulate in the warehouse. The work demonstrated in this article constituted to predict the demand of salt especially exported salt. This research utilized the historical demand data from 2014 to 2019 to predict the market of exported salt in Indonesia. The historical data were used to develop several models of autoregressive integrated moving average (ARIMA). This method was used to analysed how the forecast affected to supply chain and to prevent the bullwhip effect on it. The bullwhip effect could be known as the small fluctuations in retail demand level which could cause progressively larger fluctuation in demand at the distributor and supplier levels. The selected model corresponded to the ARIMA (1,0,1) of the tentative models with the smallest RSME value of 9.566. These results will provide to the manager of salt manufacturing to make decisions related to expand the salt market by exporting it rather than only distributing in domestic market.

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Section: Resultsmentioning

confidence: 99%

Forecasting of salt demand using ARIMA model to prevent the bullwhip effect in salt supply chain

Novianti

Utami

Dania

2022

J. Phys.: Conf. Ser.

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“…Pastore et al (2020) studied a two-echelon single-product supply chain with final demand distributed according to a known AR(1) process but with unknown parameters. The results show that the bullwhip effect is affected by unknown parameters and is influenced by the frequency at which the parameter estimates are updated.…”

Section: Literature Reviewmentioning

confidence: 99%

Impact of cross-docking on the bullwhip effect

Benrqya

Jabbouri

2022

JM2

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Purpose An important phenomenon often observed in supply chain, known as the bullwhip effect, implies that demand variability increases as we move up in the supply chain. On the other hand, the cross-docking is a distribution strategy that eliminates the inventory holding function of the retailer distribution center, where this latter functions as a transfer point rather than a storage point. The purpose of this paper is to analyze the impact of cross-docking strategy compared to traditional warehousing on the bullwhip effect. Design/methodology/approach The authors quantify this effect in a three-echelon supply chain consisting of stores, retailer and supplier. They assume that each participant adopts an order up to level policy with an exponential smoothing forecasting scheme. This paper demonstrates mathematically the lower bound of the bullwhip effect reduction in the cross-docking strategy compared to traditional warehousing. Findings By simulation, this paper demonstrates that cross-docking reduces the bullwhip effect upstream the chain. This reduction depends on the lead-times, the review periods and the smoothing factor. Research limitations/implications A mathematical demonstration cannot be highly generalizable, and this paper should be extended to an empirical investigation where real data can be incorporated in the model. However, the findings of this paper form a foundation for further understanding of the cross-docking strategy and its impact on the bullwhip effect. Originality/value This paper fills a gap by proposing a mathematical demonstration and a simulation, to investigate the benefits of implementing cross-docking strategy on the bullwhip effect. This impact has not been studied in the literature.

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“…BWE is amplification in demand variance toward upstream in the SC. Demand amplification has inspired many researchers to quantify the BWE, identify possible causes and consequences and suggest various countermeasures to reduce the BWE (Pastore et al , 2020). An amplification in demand variance is caused by lack of information, the structure of the SC and lack of collaboration (Hosoda et al , 2008).…”

Section: Literature Reviewmentioning

confidence: 99%

Lassoing the bullwhip effect by applying blockchain to supply chains

Ghode

Yadav

Jain

et al. 2021

JGOSS

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Purpose A supply chain (SC) involves many stakeholders, directly or indirectly, for satisfying consumers’ requirements. SC management is restricted by a lack of information sharing among stakeholders as parties of SC do not have direct communication and/or are not willing to share private and competitively sensitive information. In the SC, the bullwhip effect (BWE) is an undesirable phenomenon that aggravates the SC performance and increases the overall cost of SC. The main culprit of BWE is the lack of SC coordination among the parties, which results from wrong and lack of information sharing. Blockchain technology (BT) has the main characteristic of distributed shared ledger that makes all parties in the SC network able to access data. This paper aims to develop a BT model and implement it into the SC. Design/methodology/approach A blockchain is developed consisting four SC stakeholders and an integrated development environment has been used for coding in Python. Findings The analysis of the impact of the adoption of BT in SC shows the reduction in BWE. Originality/value In SC, BT can be considered as an effective tool to share the demand data among all SC partners. Sharing of such data will improve SC planning and reduce the BWE.

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The impact of demand parameter uncertainty on the bullwhip effect

Cited by 28 publications

References 45 publications

Forecasting of salt demand using ARIMA model to prevent the bullwhip effect in salt supply chain

Forecasting of salt demand using ARIMA model to prevent the bullwhip effect in salt supply chain

Impact of cross-docking on the bullwhip effect

Lassoing the bullwhip effect by applying blockchain to supply chains

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