Demand Information Sharing Deal With The Bullwhip Effect

Since 1990s, the issue of the supply chain management (SCM) is getting more and more popular in academic circle and enterprises. Efficient SCM enables enterprises to exert their potential fully, to construct their core competitive advantages and so as ,to meet challenges caused by uncertain market and rapid technical innovation. There is one common phenomenon in the supply chain called "bullwhip effect". The so-called bullwhip effect is that tiny changes of demand downstream will cause enormous fluctuation upstream. The closer to the upstream, the bigger the fluctuation. It can lead to tremendous inefficiency for the supply chain, consequently followed by excessive inventory, imbalance between demand and manufacturing capacity, and reduction of customer service level. If given appropriate treatment, eliminating the bullwhip effect can increase enterprise's profitability by 10-30%. So the mastery of its causes and countermeasures is critical to enhance efficiency in the supply chain.This dissertation elaborates the impacts of bullwhip effect upon supply chain, illuminates the causes of bullwhip effect and its economic explanation. On the basis of scholars's researches, this dissertation brings forward correspondent countermeasures against bullwhip effect. It is discussed that sharing of demand information is an important way to eliminate bullwhip effect. However, it is difficult for varied enterprises in the supply chain to share demand information completely. This dissertation establishes a two- stage supply chain model made up of retailer and manufacturer, analyzes quantificationally the impacts of information sharing upon enterprises in the supply chain. It is argued that demand information sharing can reduce manufacturer's average inventory, expected inventory cost and shortage cost, while it can't bring benefits to retailer. On the basis of the concept of Principal-Agent theory, this dissertation expatiates on two incentive strategies inorder to share demand information in the supply chain. One is that manufacturer should share supply information with the retailer, the other is that manufacturer reduces retailer's order lead-time. In this way, we can reduce bullwhip effect effectively. At the end of the dissertation, a new information system outsourcingmodel-ASP (Application Service Provider) is introduced as one method ininformation sharing amongst enterprises in the supply chain. Then taking ASP as an example, the writer analyses the value and risk of chartering information system and concludes the decision standard of information system established by the enterprise itself or chartering.Jian Rui (transport planning and management) Directed by Prof. Liu Wei...