Supply chain dynamics, a case study on the structural causes of the bullwhip effect

Abstract

THIS IS A CASE STUDY ABOUT THE MODELLING OF A SUPPLY CHAIN DECISION STRUCTURE OF A MEXICAN BOTTLING COMPANY. WE FIND THAT BY MODELLING THE INFORMATION AND DECISION STRUCTURE OF SUPPLY CHAINS, IT IS POSSIBLE TO IDENTIFY MANAGERIAL POLICIES AND INFORMATION FLOWS THAT DISTORT AND AMPLIFY MARKET DEMAND SIGNALS. IN THE SECOND PART OF THE PAPER WE USE TWO SCENARIOS TO ANALYSE VARIOUS CHANGES IN POLICIES. THIS PAPER ILLUSTRATE NOT ONLY AN INNOVATIVE FORM TO STUDY THE BULL WHIP EFFECT NOR ONLY A DIFFERENT WAY TO MODEL SUPPLY CHAINS USING SYSTEM DYNAMICS, BUT ALSO IT ESTABLISHES A RELATION SHIP BETWEE N INFORMATION STRUCTURES, DECISIONS RULES, AND DEMAND DISTORTION IN SUPPLY CHAINS.