Flexibility dimensions to control the bullwhip effect in a supply chain |
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Authors: | J. Pereira K. Takahashi L. Ahumada F. Paredes |
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Affiliation: | 1. Escuela de Ingeniería Informática , Universidad Diego Portales , Chilejavier.pereira@udp.cl;3. Department of Artificial Complex Systems Engineering, Graduate School of Engineering , Hiroshima University , Japan;4. Escuela de Ingeniería Informática , Universidad Diego Portales , Chile;5. Escuela de Ingeniería Industrial , Universidad Diego Portales , Chile |
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Abstract: | In this paper, we analyse the consequences of two flexibility dimensions proposed in a previous approach—adjustment capability and responsiveness—on the bullwhip effect in a supply-chain model when a stochastic AR(1) demand process is considered. First modelling the manager's belief on forecasting in pull, push and hybrid ordering methods, it is revealed that high adjustment capability induces a robust reduction of the bullwhip effect. Secondly, it is found that maximal responsiveness is not always a necessary management strategy. Indeed, we show that these dimensions may be organised in a trade-off, always keeping amplification to acceptable values in the whole supply chain. |
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Keywords: | flexibility dimensions bullwhip effect manager's belief forecasting process |
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