Asked by eliza mason on Jun 11, 2024
Verified
The situation in which fluctuations in orders increase as they move up the supply chain from retailers to wholesalers to manufacturers to suppliers is known as
A) market fluctuations.
B) the whiplash effect.
C) the bullwhip effect.
D) the butterfly effect.
Bullwhip Effect
The Bullwhip Effect describes the phenomenon where variability in consumer demand causes progressively larger fluctuations in demand experienced by upstream suppliers in a supply chain.
- Identify the factors leading to and resulting impacts of the bullwhip effect in supply chain management.
Verified Answer
AW
Angelica WesthouseJun 16, 2024
Final Answer :
C
Explanation :
The term for this situation is the bullwhip effect. It is named after the way a long bullwhip moves when it is flicked, with small movements at the handle creating larger movements at the end of the whip. Similarly, small fluctuations in customer demand can lead to larger and larger fluctuations in orders as they move up the supply chain. This can lead to inefficiencies and excess inventory.
Learning Objectives
- Identify the factors leading to and resulting impacts of the bullwhip effect in supply chain management.