Please use this identifier to cite or link to this item: https://doi.org/10.1016/j.ejor.2006.12.014
Title: Understanding supply chain dynamics: A chaos perspective
Authors: Hwarng, H.B. 
Xie, N.
Keywords: Beer distribution game
Chaos theory
Supply chain management
System dynamics
Issue Date: 2008
Source: Hwarng, H.B., Xie, N. (2008). Understanding supply chain dynamics: A chaos perspective. European Journal of Operational Research 184 (3) : 1163-1178. ScholarBank@NUS Repository. https://doi.org/10.1016/j.ejor.2006.12.014
Abstract: Variability in orders or inventories in supply chain systems is generally thought to be caused by exogenous random factors such as uncertainties in customer demand or lead time. Studies have shown, however, that orders or inventories may exhibit significant variability even if customer demand and lead time are deterministic. In this paper, we investigate how this class of variability, chaos, may occur in a multi-level supply chain and offer insights into how to manage relevant supply chain factors to eliminate or reduce system chaos. The supply chain is characterized by the classical beer distribution model with some modifications. We observe the supply chain dynamics under the influence of various factors: demand pattern, ordering policy, demand-information sharing, and lead time. Through proper decision-region formation, the effect of various factors on system chaos is investigated using a factorial design. The degree of system chaos is quantified using the Lyapunov exponent across all levels of the supply chain. This study shows that, to reduce the degree of chaos in the supply chain system, the adjustment parameters for both inventory and supply line discrepancies should be more comparable in magnitude. Counter-intuitively, in certain decision regions, sharing demand information can do more harm than good. Similar to the bullwhip effect observed previously in demand, we discover the phenomenon of "chaos-amplification" in inventory across supply chain levels. © 2007 Elsevier B.V. All rights reserved.
Source Title: European Journal of Operational Research
URI: http://scholarbank.nus.edu.sg/handle/10635/44035
ISSN: 03772217
DOI: 10.1016/j.ejor.2006.12.014
Appears in Collections:Staff Publications

Show full item record
Files in This Item:
There are no files associated with this item.

SCOPUSTM   
Citations

85
checked on Dec 7, 2017

WEB OF SCIENCETM
Citations

61
checked on Nov 22, 2017

Page view(s)

94
checked on Dec 10, 2017

Google ScholarTM

Check

Altmetric


Items in DSpace are protected by copyright, with all rights reserved, unless otherwise indicated.