Measuring and Analyzing the Bullwhip Effect in a Two-Product and Two Echelon Supply Chain Using Control Theory Approach

author

  • Ahmad Sadeghi Assistant Professor, Faculty of Industrial and Mechanical Engineering, Qazvin Branch, Islamic Azad University, Qazvin, Iran
Abstract:

Coordination is very important in supply chain management and it is one of the main factors in supply chain profitability. Bullwhip effect is one of the basic obstacles to achieve coordination in supply chains and reduction of this phenomenon has an important role in supply chain harmony. The other side, costs of supply chain can be mitigated and customer service level can be increased by reducing of bullwhip effect. Because measurement of bullwhip effect is very important in analysing and controlling of it, providing equations to investigate bullwhip effect behaviour based on real world supply chain conditions is necessary. The previous studies mostly concentrate on single product supply chain and few studies have been done on supply chains with more than one product. Here we quantify and investigate the bullwhip effect in a two-echelon supply chain with two products using control theory approach. Due to the relationship between demands of two products in our proposed supply chain, first order vector auto regressive model is used as demand process of the products. We also apply moving average method for lead-time demand forecasting within the "order up to" replenishment policy. We derive a closed form bullwhip measure and then bullwhip effect in a two-product supply chain is discussed and illustrated through a numerical example.

Upgrade to premium to download articles

Sign up to access the full text

Already have an account?login

similar resources

analyzing and optimization a two echelon supply chain with uncertainly returned product

high congestion of returned product at remanufacturing facility causes substantial delays and consequently remarketing value losses for time-sensitive and high-tech products with short life cycles, such as electronic equipments. at the remanufacturing site the returned product are inspected and classified according to their quality and processing time in one of the two classes: class 1 being ad...

full text

a synchronic and diachronic approach to the change route of address terms in the two recent centuries of persian language

terms of address as an important linguistics items provide valuable information about the interlocutors, their relationship and their circumstances. this study was done to investigate the change route of persian address terms in the two recent centuries including three historical periods of qajar, pahlavi and after the islamic revolution. data were extracted from a corpus consisting 24 novels w...

15 صفحه اول

Simultaneous Pricing, Routing, and Inventory Control for Perishable Goods in a Two-echelon Supply Chain

Due to the rapid development of technology in recent years, market competition and customer expectations have increased more than ever. In this situation, it is vital for businesses survival to determine the appropriate policy for inventory control, pricing, and routing, and decisions regarding each of them are often made separately. If the products have a perishable nature, it will be more imp...

full text

Pricing decisions in a two-echelon decentralized supply chain using bi-level programming approach

Pricing is one of the major aspects of decision making in supply chain. In the previous works mostly a centralized environment is considered indicating the retailers cannot independently apply their decisions on the pricing strategy. Although in a two-echelon decentralized environment it may be possible that supply chain contributors have encountered with different market power situations which...

full text

MODELING RISK OF LOSING A CUSTOMER IN A TWO-ECHELON SUPPLY CHAIN FACING AN INTEGRATED COMPETITOR: A GAME THEORY APPROACH

In a competitive market, customer decision is made to maximize his utility. It can be assumed that risk of losing a supply chain’s customer can be defined based on products utility from customer point of view. This paper takes account of product price and service level as competition criteria. The proposed model is based on non-cooperative game theory, for one-manufacturer and one-retailer supp...

full text

The Bullwhip Effect on the VMI-Supply Chain Management viaSystem Dynamics Approach: The Supply Chain with Two Suppliers and One Retail Channel

This work investigates the effect of different inventory policies of a supply chain model using the system dynamics approach which belongs to the class of Vendor Managed Inventory (VMI), automatic pipeline, inventory and order based production control systems (VMI-APIOBPCS). This work helps management to investigate the effect of different policies such as adding the VMI system or third party l...

full text

My Resources

Save resource for easier access later

Save to my library Already added to my library

{@ msg_add @}


Journal title

volume 7  issue 15

pages  55- 63

publication date 2014-09-10

By following a journal you will be notified via email when a new issue of this journal is published.

Hosted on Doprax cloud platform doprax.com

copyright © 2015-2023