Understanding and managing the Bullwhip Effect on your supply chain
Inefficiencies in the supply chain can cause a phenomenon referred to as the Bullwhip Effect. The idea, first identified by MIT professor Jay Forrester, identifies a trend of ever-increasing swings in inventory in response to shifts in customer demand as one looks further back in the supply chain. In other words, small variances in demand in lower parts of the supply chain create larger variances higher up the chain as we get closer to raw materials.
January 16, 2017
