Supply chain impact from order lead time volatility: a computer-based simulation approach

The bullwhip effect (BWE) is a well-known phenomenon in supply chain management. Whereas the past research has focused on factors like supply rationing, batch-size, lead-time, etc. mainly from an analytical perspective. This paper broadens the research by specifically examining the impact from order lead time volatility, not only on demand (order size) but also on inventory levels and supply chain cost. The result confirms past research and brings new insights in the impact on component and compound bullwhip effect behaviour across supply chain echelons by showing that order lead time volatility acts as a driver of BWE. Reducing BWE is a key lever for improving supply chain performance, and by extension, supply chain performance.