Identify the four primary causes of the bullwhip effect and the remedy for each
What will be an ideal response?
1. Cause: Demand forecast errors (cumulative uncertainty in the supply chain); Remedy: Share demand information throughout the supply chain.
2. Cause: Order batching (large, infrequent orders leading suppliers to order even larger amounts); Remedy: Channel coordination—determine lot sizes as though the full supply chain was one company.
3 . Cause: Price fluctuations (buying in advance of demand to take advantage of low prices, discounts, or sales); Remedy: Price stabilization (everyday low prices).
4. Cause: Shortage gaming (hoarding supplies for fear of a supply shortage); Remedy: Allocate orders based on past demand.
You might also like to view...
What is the purpose(s) of the stock release document?
The term ________ refers to a liability that promises a future outflow of resources.
Fill in the blank(s) with the appropriate word(s).
An increase in the risk associated with a future stream of cash should result in an increase in the discount rate used in the present value calculation.
Answer the following statement true (T) or false (F)
To conduct marketing research, the first thing a marketing manager should do if one of his firm's products drops in sales volume is to
A. conduct a survey to see what is wrong. B. interview representative customers. C. set research priorities. D. do a situation analysis. E. define the problem.