Title: Simulation studies of the effects of Safety Stock and related policies upon Bullwhip oscillation in supply chains

Authors: Balaji Janamanchi, James R. Burns

Addresses: Division of International Business and Technology Studies, Texas A&M Int'l University, A.R. Sanchez Jr. School of Business, University Boulevard, Laredo, TX 78041, USA. ' Rawls College of Business Administration, Texas Tech University, ISQS area, PO Box 42101, Lubbock, TX 79409 2101, USA

Abstract: In a recent earlier article, the dynamics of a supply chain were addressed by use of system dynamics models (Janamanchi, B. and Burns, J.R. 2007b). The focus was on the Bullwhip effect, and the possible overshoot and oscillation that can arise in Finished Goods (FG) inventories from it. In this article, studies involving the level of Safety Stock itself, along with lengthening replenishment strategies are investigated. The effects of lengthening the times to replenish Work-In-Process and FG are investigated. The impacts upon the Bullwhip effect as well as total costs and cycle time are studied. A practical strategy for implementation is also discussed.

Keywords: bullwhip effect; change management; information systems; inventory replenishment; safety stock; supply chain dynamics; supply chain management; SCM; simulation; system dynamics.

DOI: 10.1504/IJISCM.2008.020694

International Journal of Information Systems and Change Management, 2008 Vol.3 No.2, pp.171 - 187

Published online: 10 Oct 2008 *

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