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The IUP Journal of Supply Chain Management :
A Study of Bullwhip Effect and its Impact on Information Flow in Cloud Supply Chain Network
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Cloud computing services need to be understood for analyzing Cloud Supply Chain Network (CSCN). One of the key information in a Supply Chain Network (SCN) is the quantity that is demanded at various nodes of the SCN. Every node in the supply chain tends to stock more items than actually needed because of uncertainties in the estimated quantity. The quantity of items magnifies upstream the supply chain and the effect is known as Bullwhip effect. There is a need to integrate IT services with supply chain to make it agile and enhance the information flow and decision-making process. Proper information available at lower cost and in quick time can help minimize the bullwhip effect. Hence, there is a need to understand and analyze the importance of various factors pertaining to cloud computing services. Benefits from cloud computing like lower cost of hardware and software, collaborations, software support and decision support services are considered for analysis. This paper aims at determining the weightages and contribution of such services. A relationship function encompassing the key parameters pertaining to the cloud computing factors is derived, which is useful for decision making and understanding how bullwhip effect can be minimized.

 
 
 

Various stages of a Supply Chain Network (SCN) are governed by the information available at that stage. Factors like lack of communication, unorganized processes, time, and decisions on supply causes problems in SCN. In the SCN, if the stocks with the manufacturer or supplier are greater than the sales, then a problem of bullwhip effect exists in the SCN. The effect magnifies from downstream, i.e., the user end to upstream the supplier end. The bullwhip effect on the supply chain occurs because the demand for goods is obtained by forecasting rather than considering actual consumer demand. This variance can either overestimate or underestimate the demand causing fluctuations. When new products are launched in the market, there is an uncertainty about how it would sell. The success factor is difficult to calculate. However, anticipating success, companies minimize their opportunity losses by ordering more than the required quantity to be sold. There is either an increase or decrease in the inventory during the normal variations of supply and demand. With the knowledge of forecast errors, companies generally tend to keep a margin support through safety stocks. Companies will increase or decrease inventory as and when the demand increases or decreases in the market. This increases the additional inventory on every node in the SCN. There is a possibility of integrating all the entities in the SCN using low cost information communication systems that will provide timely information on a dynamic basis. Generally, huge costs are involved in setting up an IT infrastructure by the company. With the availability of low cost cloud computing services, it is possible to bring down the IT infrastructure cost to the company and the consumers. The companies can set up their supply chain management processes on portals integrated with cloud computing services. Consumers can be provided with information channel to the company’s portal through a cloud platform as it can be done at a very low cost.

 
 
 

Supply Chain Management Journal,A Study of Bullwhip Effect ,Analyzing Cloud Supply Chain Network (CSCN), Supply Chain Network (SCN).