Understanding the Phenomenon of Bullwhip Effect in Relation to Supply Chain Strategies: FMCG industry

Abstract

The business environment challenges the competence of supply chain performance on responsiveness, connectivity and agility to ameliorate phenomenon of bullwhip effect.The extent of relationship between bullwhip effect and supply chain strategies should optimize product flows and availability from the amplified demand order oscillations. The study has used multiple regression techniques on 448 responses to tentatively develop the supply chain models. This study reveals that the challenges of bullwhip effect are explained by accuracy of demand forecasting, transport systems, information sharing and velocity, risk pooling system and integrated e-SCM systems. The results provide new perspective in managing amplification in the consumer demand order variability moving upstream supply chain network. The model will help to address the challenges of bullwhip effect and further enhance the overall efficient frontiers of supply chain performance. This paper provides insights to FMCG industry on using innovative strategies and modern technology to enhance supply chain visibility through integrated systems networks.

DOI: 10.5901/mjss.2014.v5n20p570