Title: Stability Control in a Supply Chain: Total Costs and Bullwhip Effect Reduction
Citation: The Open Operational Research Journal vol. 2 p. 51-59
Publisher: Bentham
Publication Year: 2008
JRC N°: JRC34909
ISSN: 1874-2432
URI: http://www.bentham.org/open/toorj/openaccess2.htm
DOI: 10.2174/1874243200802010051
Type: Articles in periodicals and books
Abstract: The bullwhip effect refers to the phenomenon of demand distortion in a supply chain. By eliminating or controlling this effect, it is possible to increase product profitability. The main focus of this work is to apply a control technique, based on the divergence of system, to reduce the bullwhip effect in a single-product one echelon supply chain, in which an Order-Up-To (OUT) order policy is applied. First the relationships between bullwhip, stability of the supply chain and the total costs are analyzed. Second the divergence-based control strategy is applied to stabilize the supply chain dynamics with a considerable reduction of the total costs (> 30%) and, in relevant cases, of the bullwhip effect.
JRC Directorate:Institute for Health and Consumer Protection Historical Collection

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