On serial and parallel information flows,incorporated in a multi-stage production-inventory-system

We consider a chain of production operations separated by inventories, where two different systems-for replenishing the inventories at each stage may be adopted. In the first, the serial information-flow system, each stage works against orders placed only by the following stage. In the second system, called the parallel information-flow system, every stage in the network works against the actual customer demand, materializing at the finished-goods stage.

The basic objective is to show that in the former system the levels of base stock to be maintained at the different stages are more sensitive to changes in the customer demand than in the second system. In fact, in the former case, base-stock fluctuations become larger and larger, progressively back in the chain. Consequently, the production rates also behave in the same way and their variations got multiplied successively back in the chain.