Central applications of Tesfay coordination in transportation supply chain: Case of airline industry

Abstract

Abstract This paper is extensions of the Tesfay (2014) paper on the Bullwhip effects and Tesfay (2015) paper on the foundations of the Bullwhip effect and its implications on the theory of organizational coordination. The major outcome of the Tesfay (2014) paper suggests that one way or another Bullwhip effect attacks all the business collaborates in supply chain. The major outcome of the Tesfay (2015) paper suggests that the solutions from the transaction cost economics are still insufficient to produce the most efficient organizational coordination. This paper extends stochastic analysis by applying various panel data regression models and structural equations of seemingly unrelated regression (SUR) models on the experimental data from Beer game. Recursive autoregressive-SUR model estimation result confirmed that the Bullwhip effects can be cause by both intra-organizational coordination and inter-organizational coordination of the business collaborates of supply chain. In order to control the effect of intra-organizational coordination on the Bullwhip effects, the author outline a new coordination type known as the hyper-hybrid coordination. As a final point, the author has shown important applications of the hyper-hybrid coordination in the airline industry.