On the Significance of Demand and Inventory Smoothing Interventions in Supply Chain

Abstract:     
The aim of this paper is to quantify the benefit of demand and inventory smoothing in contrasting the extreme volatility and impetuous alteration of the market produced by the current economic recession. To do so we model a traditional supply chain and we test five settings of order smoothing under two shocks in the market demand, and we measure the effect in term of internal process benefits. Results highlight how a higher level of smoothing can generally improve the operational performance of the supply chain.

Number of Pages in PDF File: 9

Keywords: Bullwhip effect, Inventory management, Order up to, Economic recession

JEL Classification: C0, C1

working papers series