In: Operations Management
What is the bullwhip effect? Please provide an example as part of your answer.
2) Find an example of a firm that experienced (is experiencing) supply chain disruption as a result of the COVID-19 pandemic. Describe the disruption and how the firm responded to the disruption. Please be sure to cite your source(s).
What is the bullwhip effect? Please provide an example as part of your answer.
2) Find an example of a firm that experienced (is experiencing) supply chain disruption as a result of the COVID-19 pandemic. Describe the disruption and how the firm responded to the disruption. Please be sure to cite your source(s).
1) Bullwhip effect is a supply chain phenomenon where the supply of the product is driven by the demand of the product. As one moves upward in the supply chain, the inventory fluctuates as per the demand of the customer. Companies order more and more amouint of goods to meet the increasing demand. It starts from the retailer and flows downward to the raw material supplier. For example the retailer maintains the stock of 100 packs of 10-pack bottles of softdrink.
2) Almost 75% of the world companies are facing supply chain disruption due to COVID-19 which includes pharmaceuticals and manufacturers. One example is pharma sector in India(Sun Pharmaceutical).
Due to lockdown in India the transportation and courier service of medical supplies have stopped. Some state government authorities are not issuing permits for manufacturing drugs. Printers are not available for packaging medicines and there is no supply of parts or equipment from China which accounts almost 70% of import.
This is how the industry is handling the situation is-
-Since the importing from China has stopped so the manufacturing of
drugs is taking place within the country.
-Simulation models have been built which are considering the
inventory and demand levels.
-Analysis of increased freight cost and export restrictions.
-The industry has also enhanced the workforce planning and employee
protection programs
- Contacting through technology and ERP
- Setting up risk analysis tool for the have monitoring of current
supply and demand.
- Jointly working with other companies of supply chain management
to mitigate the risk
- Enhanced testing of drugs
-geographically moving on to local areas for supply chain
management
Source- The Economic Times , Hindustan Times and ndtv