Lecture Chapter 10 - Coordination in Supply Chain by Chopra

Learning Objectives:
1 Describe supply chain coordination and the bullwhip effect, and their impact on supply chain performance.
2 Identify obstacles to coordination in a supply chain.

Lack of Supply Chain Coordination and Its Impact on Performance:
Supply chain coordination – all stages of the chain take actions that are aligned and increase total supply chain surplus
Requires that each stage share information and take into account the effects of its actions on the other stages
Lack of coordination results when:
Objectives of different stages conflict
Information moving between stages is delayed or distorted.

What is BullWhip Effect:
Fluctuations in orders increase as they move up the supply chain from retailers to wholesalers to manufacturers to suppliers
Distorts demand information within the supply chain
Results from a loss of supply chain coordination