It’s called The Beer Game[1].
One of the funny things about it is even people that have played and discussed it before _still_ make the same fundamental mistakes next time.
Short-termism is the death of companies.
It’s called The Beer Game[1].
One of the funny things about it is even people that have played and discussed it before _still_ make the same fundamental mistakes next time.
Short-termism is the death of companies.
The point of the beer game is that buffering in the supply chain makes the bullwhip effect worse.
And a 2nd time where you minimize buffering and use just in time inventory management.
People who have played the game knows which one outperforms. By significant margins.
You need an integral part that knows what the entire chain reaction time is. But if you don't have a buffer, you can't do that part, you can only react strictly to the conditions your suppliers have right now.
A derivative part seems quite useless in a non-coordinated game. But it could in theory pass a "message" upchain that they need to start reacting. Anyway in any real situation it will be easier to pass a message around by telling stuff to people.
At the end of the day, the relative penalty for storage or non-delivery is what will dictate the optimum play style. But it's perfectly viable to use buffers to attenuate the bullwhip instead of making it larger.