The
Blank
______ effect occurs when distorted product-demand information ripples from one partner to the next throughout the supply chain.

Question

The 
Blank
______ effect occurs when distorted product-demand information ripples from one partner to the next throughout the supply chain.

BlackTom AI · Accepted Answer

The question targets a specific supply chain phenomenon involving distorted product-demand information.
Option 1: execution. This term does not describe the ripple effect of demand information through a supply chain; it more likely refers to carrying out tasks or operations rather than a demand-information phenomenon. Therefore, this choice mischaracterizes the concept at hand.
Option 2: bullwhip. This term correctly names the effect where small fluctuations in consumer demand cause increasingly larger distortions as they propagate upstream from retailers to wholesalers, manufacturers, and suppliers. The bullwhip effect is driven by factors such as order batching, price fluctuations, lead times, and misinterpretation of demand signals, leading to inefficiencies across the chain.
Option 3: interchange. In supply chain terminology, interchange generally refers to exchanging goods or information between parties, not the amplification of demand distortion across the chain. It does not capture the dynamic of information ripples and inventory swings that characterize the effect described in the question.
In summary, the statement described in the question aligns with the bullwhip effect, which is the phenomenon where distorted product-demand information travels from one partner to the next, amplifying as it moves upstream in the supply chain.

The Blank ______ effect occurs when distorted product-demand information ripples from one partner to the next throughout the supply chain.

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Similar Questions

The bullwhip effect increases upstream order variability.

The bullwhip effect refers to:

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A retailer notices a small increase in customer purchases and orders double the amount from the distributor. The distributor then orders triple from the manufacturer. This scenario is an example of:

The bullwhip effect occurs when order variance decreases upstream.

What occurs when distorted product-demand information ripples from one partner to the next throughout the supply chain?

What is the Overall Bullwhip Effect?

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