Horizontal Bullwhip Effect - Empirical Insights into the System Dynamics of Automotive Supply Networks. Issue 13 (2019)

• Record Type: Journal Article
• Authors: Gruchmann, Tim; Neukirchen, Thomas
• Is Part Of: IFAC-PapersOnLine. Volume 52:Issue 13(2019)
• Page Start: 1266
• Page End: 1271
• Publication Date: 2019
• Subjects: Bullwhip Effect -- Schedule Instability -- Automotive Industry -- System Dynamics; Automatic control -- Periodicals; 629.805
• DOI: 10.1016/j.ifacol.2019.11.372
• Languages: English
• ISSNs: 2405-8963

Abstract

Abstract: As a result of a conceptual simulation study proposed by Gruchmann and Rebs (2018), the bullwhip effect in automotive supply chains is not just detectable on a vertical supply chain level under demand uncertainties, but also on a horizontal supply chain level when production risks are present. Hence, it is important to validate these results by real-life business data to gain further empirical insights into the scheduling dynamics of such networks. To measure schedule instability in automotive call-off systems, the German association of the automotive industry (VDA) proposes a set of key measures to assess schedule quality and stability (VDA guideline 5009). For this study, the key figure forecast quality (FQ) is used to analyze demand information collected from a 1st tier supplier providing components to several original equipment manufacturers (OEMs) in Europe in a period up to four months. In this context, the VDA recommends that schedule instability should decrease when moving from a long-term to a short-term planning horizon. However, the results of the analysis indicate that forecast instability increases shortly before dispatching the required parts leading to dependent requirements variations (DRVs). To the best of our knowledge, none of the existing studies addressed a horizontal bullwhip effect empirically so far. Hence, the present study intends to contribute to theory and practice by providing theoretical and managerial insights on the dynamics of the horizontal bullwhip effect.