When small changes generated by a customer produce progressively larger changes at each stage upstream in the supply chain, this is known as:
A)Buffering.
B)Bullwhip effect.
C)Pareto effect.
D)Vendor managed inventory.

Question

Quizplus · Accepted Answer

The bullwhip effect occurs when small changes in demand at the end of the supply chain result in progressively larger fluctuations in demand upstream in the chain. This creates inefficiencies and higher costs for all members of the chain. The other options (Buffering, Pareto effect, Vendor managed inventory) do not describe this phenomenon.

When Small Changes Generated by a Customer Produce Progressively Larger