WHIP EFFECT IN A FALLING CHAIN

Abstract The main goal of our research is to analyze and display causes of a bullwhip effect formation within a supply chain, as well as to provide the appropriate solutions to limit the occurrence of the bullwhip effect by using the proper information flow and partners’ cooperation within the supply chain. The bullwhip effect is one of the most important issues in the supply chain management and it is present in many companies. It preserves a character of invisibility because there are lots of causes for its formation and they are usually difficult to discern. The bullwhip effect is a phenomenon of an increase in the order variability within a supply chain. The higher we are within the supply chain, the higher is the order variability. The company encountered with the whip effect can successfully reduce its impact by improving the information flow, as well as improving partners’ cooperation within the supply chain. In this way the company can limit its negative repercussions and increase the profit. The article focuses on the overview of the bullwhip effect within a distribution chain, from its causes to suggestions and measures how to ease its negative repercussions on the organisation. Part of the causes could be found in the market demand variability and in the lack of communication about the actual marked demand within the supply chain. The rest of the causes are related to obstacles that emerge among different partners within the supply chain (role of culture). A qualitative analysis is applied on the basis of the selected cognitions from the supply chain management. The quantitative analysis is based on the theoretical research of the effective flow of information among the participants and its contribution to the reduction of the bullwhip impact. The article discusses two research questions: 1) The correct information flow within the supply chain and the improvement of the communication among partners can lead to the bullwhip effect reduction, and 2) A reduction of the bullwhip influence can lead to the increase of cooperation among partners. The results of the analysis can be used for further research.

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PLANNING FOR OPTIMUM SUPPLY CHAIN THROUGHPUT AS A CRITICAL FACTOR IN MAKING A SUCCESSFUL CHAIN IN THE MARKET

Vestnik of Polotsk State University. Part D. Economic and legal sciences ◽

10.52928/2070-1632-2021-56-5-34-37 ◽

2021 ◽

pp. 34-37

Author(s):

O. S. Huliahina

Keyword(s):

Supply Chain ◽

Strategic Alliances ◽

Planning Process ◽

Critical Factor ◽

Market Demand ◽

Efficient Operation ◽

Efficient Planning ◽

Internal Efficiency ◽

Whip Effect ◽

Chain Links

The article discusses the need to ensure the optimal throughput of the supply chain as the most important factor in maintaining the effective and efficient operation of the chain. The notion is given. The importance of throughput planning is noted. It is presented as a search for a compromise between the speed of response to demand and the internal efficiency of the chain links. In addition, some of the barriers that hinder the simplicity of the throughput planning process in the chain are considered. They are the “whip effect” and the conflict of interests of the participants in the chain. The article also proposes approaches that allow to achieve the most efficient planning of throughput in the chain, taking into account all the existing requirements and restrictions. The author proposes supply chain management as a single system and its synchronization with every moment of actual market demand. The next propose is the introduction of strategic alliances.

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