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Essay / International Supply Chain Management Case Study
Why Things Went Wrong While Playing the Famous “Beer Game”. In this exercise, participants assume the role of customers, retailers, wholesalers and suppliers of beer, but are not allowed to communicate freely with each other. Instead, we must make ordering decisions based solely on the orders of the next downstream actor. The academic application of the beer game has always yielded common results: the upstream variability is much greater than the downstream variability. Such results imply that irrational decision-making resulting from misunderstandings about inventory and demand information can cause the bullwhip effect (Bullwhip effect, 2015). The bullwhip effect is actually the product of reasonable decisions made within a flawed supply chain infrastructure. In this context, four major causes have been