Broadening the Horizons of Bullwhip Effect: A Proposal

Abstract

The objective of this paper is to propose a broadening of the horizons of the bullwhip effect construct. The bullwhip effect has been explored within intra-organisational and inter-organisational stocking levels of supply chains. A broader descriptive framework is proposed, one that positions the bullwhip effect construct at industrial and societal levels. A conceptual framework is provided that bridges the interface between the micro and macro environments of the bullwhip effect construct, but further conceptualization is required. The introduced broadening of the bullwhip effect construct reveals a number of research potentials. A principal one is that the exploration of the construct may consider the industrial and/or the societal environment when the bullwhip effect is studied in supply chains. The broadening of the bullwhip effect in the overall environment is of interest to practitioners. It stresses the importance of contextual factors in operative, tactical and strategic inventory management. The principal contributions are: a) an interface between micro and macro levels in inventory management contributing to broaden the horizons of the bullwhip effect; b) a typology of the bullwhip effect contributing to broaden the same construct; and c) the bullwhip effect being seen as two-way view construct at the micro level. Most important of all is that the causes and effects of the bullwhip effect have been addressed in a wider context that so far has been underestimated in literature.