SIOM Simulacrum

Simulacrum

Team- ActiveY

NITIE, Mumbai

Sandeep Singh Bedi, bedisandeep@gmail.com, 9702970021

Pradeep Chhabria, p.chhabria.lnmiit@gmail.com, 9702968768

Rakesh Sahu, rksahu.83@gmail.com, 9757308086

Shanu Singh, shanuchaudhery@gmail.com, 9702018520

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Question 1: What is Bullwhip Effect and how does it relate to lack of coordination in a supply

chain?

Bullwhip Effect is the phenomenon where a retailer’s orders to their suppliers tend to have a larger

variance than the consumer demand that triggered the orders. This demand distortion propagates

upstream with amplification occurring at each echelon. Three major causes of the Bullwhip Effect:

1. Lead time of information sharing and material

2. Order batching & forecasting error

3. Supply shortages, which also lead to artificial demands.

Oscillating demand magnification upstream in supply chain is shown below:

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Lack of Coordination of information across different tiers leads to ripple effect as shown above. It can

be dealth with real-time information sharing system hence reducing the lead time, controlling the

inventory and finally improving the service level.

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Question 2: What problems result if each stage of a supply chain views its demand as the orders

placed by the downstream stage? How should firms within a supply chain communicate to

facilitate coordination?

If demand is taken as the order placed, then downstream stage had to rely on the sales orders from

stage above to product forecasts, plan capacity, control inventory, and schedule production. Big

variations in demand will be a major problem, leads to bullw

The common inefficiencies in this supply chain are mentioned in below figure.

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Question 2: What problems result if each stage of a supply chain views its demand as the orders

placed by the downstream stage? How should firms within a supply chain communicate to

If demand is taken as the order placed, then downstream stage had to rely on the sales orders from

stage above to product forecasts, plan capacity, control inventory, and schedule production. Big

variations in demand will be a major problem, leads to bullwhip’s effect.

The common inefficiencies in this supply chain are mentioned in below figure.

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Question 2: What problems result if each stage of a supply chain views its demand as the orders

placed by the downstream stage? How should firms within a supply chain communicate to

If demand is taken as the order placed, then downstream stage had to rely on the sales orders from

stage above to product forecasts, plan capacity, control inventory, and schedule production. Big

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Approaches to provide Better Communication within Supply Chain

Data requirements for supply chain modeling

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Approaches to provide Better Communication within Supply Chain

Data requirements for supply chain modeling

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Question 3: How is the building of strategic partnerships and trust valuable within a supply

chain?

Successful supply chain performance is based on a high level of trust and robust partnership

strategies.

Strategic Partnership aims for synergy among partners based on trust with a belief that benefits

from alliance would be more productive than an individual unit.

It provides:

• Reduced conflict between partners.

• On-time delivery

• Greater consistency in parts, supplies, semi-assembled, and completed products

• Effective information sharing among partners resulting in better knowledge for accurate

forecasts

Characteristics

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Trust among partners is an essential requirement for a successful Supply Chain.

Firms within a supply chain environment need to share resources and information

building trust for a successful Supply Chain.

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among partners is an essential requirement for a successful Supply Chain.

Firms within a supply chain environment need to share resources and information

building trust for a successful Supply Chain.

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among partners is an essential requirement for a successful Supply Chain.

Firms within a supply chain environment need to share resources and information with partners by

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Question 4: What are the different CPFR scenarios and how do they benefit the supply chain

partners?

Collaborative Planning, Forecasting, and Replenishment is a business process model whereby supply

chain trading partners can jointly plan key supply chain acidities from production and delivery of raw

materials to production and delivery of final products to end customers. The latest version of the

CPFR guidelines is an interactive cycle of four main activities, so called Collaboration Activities as

shown in below diagram.

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The CPFR reference model is designed to fit many scenarios. Any individual CPFR program must adapt

the model to the particular needs of the trading relationship

We can select multiple scenarios from above table according to adaptability and industry.

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References

1. How human behaviour amplifies the bullwhip effect , Joerg Nienhaus, Arne Ziegenbein ,

Christoph Duijts, Centre for Enterprise Sciences (BWI), Swiss Federal Institute of

Technology (ETH) Zurich, Zuerichbergstrasse 18, 8028 Zurich, Switzerland

2. The Bullwhip Effect In Supply Chains, Hau L Lee, V Padmanabhan, and Seungjin Whang;

Sloan Management Review, Spring 1997, Volume 38, Issue 3, pp. 93-102

3. Challenging the bullwhip effect with advanced information sharing By R. Douglas Derrick

4. Reducing the impact of demand process variability within a multi-echelon supply chain,

Francisco Campuzano Bolarín ,Lorenzo Ros Mcdonnell, Juan Martín García, Department of

Business Economy . Technical University of Cartagena. Campus Muralla del Mar s/n, 30201.

Cartagena (Spain).

5. Managing Supply Chain Demand Variability with Scheduled Ordering Policies Ge ´rard P.

Cachon Duke University, Fuqua School of Business, Durham, North Carolina 27708,

www.duke.edu/ ˜gpc

6. CPFR Overview Handbook, Voluntary Inter industry Commerce Standards (VICS), FIVE

ESSENTIAL ELEMENTS OF INTEGRATED SUPPLY CHAIN MANAGEMENT, AQUA

MANAGEMENT CONSULTING GROUP

7. A Guide to CPFR Implementation, Accenture

8. A white paper by J D Edwards on CPFR — COLLABORATIVE PLANNING,

FORECASTING AND REPLENISHMENT\

9. Collaborative Planning, Forecasting and Replenishment (CPFR®, VICS, 2004.