Simulation-based analysis of lead time uncertainty, information sharing and cooperation on bullwhip effect in a multi-stage supply chain

Supply chain management is critical for success in a lot of businesses. The amplification of order variance along the entire supply chain, also known as the bullwhip effect, is one of the most important performance measures in supply chains. Bullwhip effect could create several negative consequences, including excessive inventory, unstable production schedule, and poor customer service.;A variety of factors, including information sharing between the entities in the supply chain, mean and standard deviation of lead time, have different influences on the bullwhip effect in supply chains. However, most of the current research has focused on the effect of the individual factors on the bullwhip effect in two-stage supply chains or multi-stage supply chains without the consideration of cooperation of the involved entities. Among these studies, quantitative consideration of the costs associated with the supply chains has not been addressed while evaluating the bullwhip effect.;This thesis investigates the bullwhip effect for a single-product, multi-stage supply chain while considering cooperation of the involved entities. The collective impact of four selected factors (i.e., mean of lead time, standard deviation of lead time, information sharing between the entities in the supply chain, and cooperation among the involved entities) on the bullwhip effect was evaluated using a simulation approach. Each factor has two levels for consideration, giving rise to a total of 16 different scenarios. Furthermore, this research analyzes the collective impact of these factors on the associated costs at each stage (i.e., retailer, distributor, and manufacturer) of the supply chain.;The results from the simulation study, analyzed using the analysis of variance technique, show that the mean of lead time and the standard deviation of lead time have the most significant impact on the bullwhip effect and on the costs of the supply chain. Information sharing and the interaction between information sharing and the standard deviation of lead time are the second most important factors that influence the bullwhip effect and the costs of the supply chain.