Analysis of bullwhip effect and the robustness of supply chain using a hybrid Taguchi and dual response surface method

Abstract

The purpose of this paper is to quantify the effect of design parameters on the bullwhip effect and dynamic responses produced by a multi-echelon supply chain with different information-sharing strategies. An effective and efficient supply chain strategy should be capable of reducing costs and enhancing customer service level, and should be capable of enhancing the robustness of the supply chain. In this study, the robustness of different supply chain strategies under various uncertain environments is studied using simulated beer game. Firstly, discrete event simulation method is adopted to model supply chain with automatic pipeline inventory and order-based production control system (APIOPBCS). In order to deal with the non-linearity, such as capacity constraints, simulation experiments together with a hybrid Taguchi and dual-response surface method are performed to quantify the impact of a supply chain's design parameters on its dynamic performance. This research gives supply chain managers and designers a practical way to develop a trade-off between inventory cost and customer service level and to take better considerations about information-sharing strategies and bullwhip effect. Future work should develop a multi-response optimization towards robustness performances indicators of supply chain.