Title: Taming the bullwhip effect whilst watching customer service in a single supply chain echelon
Authors: Disney, SM ×
Farasyn, I
Lambrecht, Marc
Towill, DR
Van de Velde, W #
Issue Date: 2006
Publisher: Elsevier science bv
Series Title: European journal of operational research vol:173 issue:1 pages:151-172
Abstract: We study a generalised order-up-to policy that has highly desirable properties in terms of order and inventory variance and customer service levels it generates. We quantify exactly the variance amplification in replenishment orders, i.e. the bullwhip effect, and the variance of inventory levels over time, for i.i.d. and the weakly stationary auto regressive (AR), moving average (MA) and auto regressive moving average (ARMA) demand processes. We demonstrate that high customer service as measured by fill-rate, and smooth replenishments need not increase inventory cost substantially. We observe that in some instances of the ARMA demand pattern this comes at the expense of a relatively small increase in safety stock, whilst in other instances inventory levels can actually be reduced. (c) 2005 Elsevier B.V. All rights reserved.
ISSN: 0377-2217
Publication status: published
KU Leuven publication type: IT
Appears in Collections:Research Center for Operations Management, Leuven
× corresponding author
# (joint) last author

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