Stockouts are among the most harmful events operations managers encounter in manufacturing. In addition to disrupting the smooth flow of operations in one firm, they also can interrupt the operations of other firms both upstream and downstream in the supply chain. This is called a bullwhip effect: When one firm in the supply chain must meet an emergency order and depletes its regularly allotted quantity of supplies to fulfill that order, a stockout occurs. The firm is then forced to make unanticipated demands upon its suppliers for more materials. Those upstream suppliers in turn are put in a crunch, and the problem magnifies as the outages progress up the supply chain. In this era of lean production in which inventory reduction has become an obsession, stockouts and their consequent bullwhip effects are haunting specters.
展开▼
