Book Ch5: The Value of Information Flashcards Preview

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Flashcards in Book Ch5: The Value of Information Deck (3)
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1
Q

What are five factors that effect variability in the supply chain?

A
  1. Demand forecasting
  2. Lead time
  3. Batch ordering
  4. Price fluctuation
  5. Inflated orders
2
Q

What are four methods to cope with the bullwhip effect?

A
  1. Reducing uncertainty: Centralizing demand information
  2. Reducing variability: Through everyday low pricing
  3. Lead time reduction: Through cross docking
  4. Strategic partnership: Changing the way information is shared
3
Q

What are two contracts that provide incentives for buyers to reveal their true forecasts?

A
  1. Capacity reservation contracts

2. Advance purchase contracts