Taming the bullwhip in the supply chain is a very famous term in the past few decades. It necessarily means that instead of just fulfilling customer orders as they arrive, one should not the back story. In other words, one should be well aware of the swings in demands and hence be ready to adjust their supply chain accordingly to be more effective, optimized, and save revenue lost due to the inefficiencies in the supply chain caused by the bullwhip effect (Lee, 2010).
While there are many causes of a bullwhip effect, some important ones include demand forecast updating, order batching, price fluctuation, rationing, and shortage gaming. To avoid multiple demands, forecast update, one must avoid doing different forecasts at different levels in the organization. One must make sure that the same raw data is available for all the departments so that there are data transparency and efficiency. To avoid gaming during shortage situations, companies can follow tactics wherein instead of allocating products based on orders, they can allocate based on past sales records. To avoid the bullwhip effect caused by batch ordering, one can employ many methods like creating smaller sub-orders, distributing the load in multiple trucks, and using other third-party transportation logistics in order to fulfill these untimely large orders (Lee, Padmanabhan & Whang, 1997).
Reference
Lau, Y., Ng, K.Y. A., & Acevedo, J. (2019). Principles of Global Supply Chain Management. Anthem Press.
Lee, Hau L., Padmanabhan, V., & Whang, S. (1997). Sloan Management Review
Lee, Hau L. (2010). Journal of Supply Chain Management
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