Watch my interview with Lokad TV now on YouTube

A few weeks ago I was interviewed by Lokad TV on the bullwhip effect. Lokad is an innovative French company that develops forecasting and supply chain management software. Lokad is no normal supply chain software provider - they not only make software, they also provide a forecasting and supply chain planning as a service - they have skin in the game. Founded in 2008 by Joannes Vermorel, Lokad was an early adopter of cloud computing; they are now exploring the deep learning frontier.

In my interview with Joannes Vermorel and Kieran Chandler, I talk about the causes of the bullwhip effect as proposed by the famous Lee et al. (1997) bullwhip paper: demand signal processing, batch, rationing and gaming, and price fluctuations. We then discuss whether the bullwhip is inevitable. I advocate the use of: proper forecasting, proportional feedback controllers, information sharing, and vendor managed inventory strategies for reducing and eliminating the bullwhip effect. I highlight a road map for eliminating the bullwhip effect that consists of six stages:

• Understanding your supply chain with dynamic value stream mapping.
• Identifying your strategic supply chain objectives.
• Aligning your forecasting system to your strategic objectives.
• Tuning your replenishment system to minimize costs.
• Delivering the desired production (replenishment) plan.
• Communicating schedules with your suppliers.

We finished the interview with some thoughts on whether the bullwhip problem is still relevant today and the impact COVID will have on the dynamics of global supply chains.

Why not watch my video on YouTube? It distills 25 years of thought into a 29 minute discussion!