Search
100 second reflection for week 5
Think for 100 seconds, and summarize the key things that you learned in the class in week 5 (bullwhip effect).
In class this week, I learned that the variability of demand increases as you go away from the customer with the bullwhip effect. This is a problem however because there is excessive production at some times and idle capacity at other times. There can also be high inventory/stock out, premium transportation and poor customer service. To mitigate the bullwhip effect, it’s important to make customer demand more visible to everyone, have a single point of forecast and reduce lead time.
I learned that the farther from the consumer in the supply chain, the harder it is to predict the amount of inventory you need because you do not see the direct effects of consumer behavior.
Bull whip effect has problem in excessive production, high inventory/stock out/ poor customer service like cancellation. In order to remove this effect, companies should avoid multiple demand update forecasts, break order batches, stabilize prices, and eliminate gaming in shortage situation.
During week 5, I learned that the bullwhip effect can cause serious problems in the distribution channels of the supply chain. When rapid changes of customer demand take place, inventory becomes very volatile and the supply chain begins to “weaken.” It is importance to minimize errors within the supply chain so there is always an appropriate amount of inventory to distribute to the consumer.
during week 5 we learned that as you go down the line through the supply chain, variability of demand increases. It is difficult for the factory to guess how much raw materials they should buy, because they are so far from the retailer. This is called the bullwhip effect. One way to make it less variable is to let everyone in the supply chain know of all demand curves throughout the chain.
The past week we learned about a effect on the supply chain known as the Bullwhip Effect. The bullwhip effect causes problems in all distribution channels in the supply chain. These problems are caused by drastic differences in supplier demand, because the supply chain weakens because of the excess inventory or shortage of inventory. To reduce/minimize the effects of bullwhip it’s necessary to put all stages of the supply chain on a platform (IS) for all to see.
During week 5 we learned about the Bullwhip effect, which causes problems throughout the supply chain. It does this because supplier demand is not on par with what the demand needed by the next step in the supply chain. Throughout week 5 we learned how much damage and trouble this can cause for a company and by experiencing what can cause this through the Beer games, I believe we all took notice as to how much chaos and costs can be created through one order that creates the bullwhip effect.
During week five I learned about the bull whip effect and all the problems that it causes along the supply chain. Every aspect can be effected depending on which channel of distribution is late to react on consumer demand. More transparency of demand throughout this process could help distribution channels to prevent or make bull whip effects less frequent.
The Bullwhip effect shows the delayed snowball effect of “panic” through the supply chain. Since the factory is so far down the supply chain its hard for them to estimate how much raw materials to order. This uncertainty moves through out the supply chain because customer demand isn’t available to all suppliers of the chain. By making actual customer demand more transparent, the supply chain can minimize the bullwhip effect.
Through the beer simulation, I realized how important communication is between all levels of the supply chain. The operations of the factory are greatly dependent on the needs of the distributor, whose needs depend upon the wholesaler, who supplies the retailers that provide resources for the consumers. This tight-knit cycle experiences inefficiencies when demand is incorrectly forecasted by the retailer and because of the the time lag of information delivery between the supply chain levels. Point-of-sale systems would definitely aid the managers at each level because of the immediate relay of shipment data and inventory levels.
I learned that the bullwhip effect seems to be inevitable in all supply chains. Round 1 of the beer game resulted in a huge bullwhip because of a lack of communication among our team. In round 2, we communicated throughout the game and the bullwhip effect was much smaller. Even with communication, the bullwhip effect can’t be eliminated. Lead time plays a big role in it because it makes it difficult to have a perfect forecast.