Booms, Busts, and Beer: Understanding the Dynamics of Supply Chains
Name
Sterman Beh Ops Handbook Chapter 140210.pdf
Size
626.85 KB
Format
Adobe PDF
Checksum (MD5)
990a0d705a934c269c10eb1f885df29d
Author(s)
Sterman, John
Date Issued
July 2015
Journal
The handbook of behavioral operations management: social and psychological dynamics in production and service settings
Publisher
Oxford University Press
Citation
Sterman, John. “Booms, Busts, and Beer.” The Handbook of Behavioral Operations Management (July 1, 2015): 203–237.
Version
Author's final manuscript
Abstract
Supply chains are fundamental to a wide range of systems. Many exhibit chronic instability, including oscillations, amplification as disturbances move upstream from final sales, and phase lag. Every supply chain consists of networks, including stocks and flows of material, time delays, and the decision rules that couple them. This chapter develops a dynamic model of supply chains and shows how it can be customized to various situations. The model explains the sources of oscillation, amplification, and phase lag. Simulations, field studies, and experiments demonstrate that supply chain instability and oscillations arise from the failure of decision-makers to account for the time delays in the system and the supply line of orders not yet received, and failure to understand basic principles of accumulation. Two learning activities, the Manufacturing Case and the Beer Distribution Game, provide interactive experiences that help students and executives understand the structure and dynamics of supply chains.
MIT Department
Massachusetts Institute of Technology. Institute for Data, Systems, and Society
Sloan School of Management
Terms of Use
Creative Commons Attribution-Noncommercial-Share Alike
Persistent DSpace Link
DOI of Published Version
https://doi.org/10.1093/acprof:oso/9780199357215.003.0011
