System-Wide Training and Coordination, the Impact of Learning on the Bullwhip Effect: An Experimental Study

23 Pages Posted: 28 Mar 2005

See all articles by Yan Diana Wu

Yan Diana Wu

Pennsylvania State University - Smeal College of Business

Elena Katok

University of Texas at Dallas

Date Written: February 2005

Abstract

This paper investigates how training and communication affect the bullwhip effect, in supply chains - an observation that orders become more variable as one moves towards the source of production. We study the issue in the laboratory using the Beer Distribution Game, and find that the visibility of one's own supply line, (unfilled orders) helps stabilize the system, but does not eliminate the bullwhip effect. We test two different training protocols - system wide training, in which each participant experiences every supply chain role, and role-specific training, in which each participant experiences a single role only. We find that neither training protocol improves performance in our experiments, but when training is combined with communication, performance improves markedly. Our results indicate that the bullwhip effect is, at least in part, due to insufficient coordination between supply chain partners.

Keywords: Bullwhip effect, supply chain management, communication, system-wide

Suggested Citation

Wu, Yan Diana and Katok, Elena, System-Wide Training and Coordination, the Impact of Learning on the Bullwhip Effect: An Experimental Study (February 2005). Available at SSRN: https://ssrn.com/abstract=673524 or http://dx.doi.org/10.2139/ssrn.673524

Yan Diana Wu

Pennsylvania State University - Smeal College of Business ( email )

University Park, PA 16802
United States

Elena Katok (Contact Author)

University of Texas at Dallas ( email )

Jindal School of Management
800 W. Campbell Dr.
Richardson, TX 75080
United States

HOME PAGE: http://www.utdallas.edu/~ekatok/

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