Modeling the Bullwhip Effect in a Multi-Stage Multi-Tier Retail Network by Generalized Stochastic Petri Nets

Abstract

Bullwhip effect (BWE) refers to the accumulation of stock flowing up and down along the supply chain management (SCM). It reduces the operating efficiency of the chain and blocks the operating resources. Some of the common causes of BWE are demand order variations, long lead times, competence defects between supply chain links, lack of communication among links in the chain, etc. There have been efforts to overcome these issues. However, very little work has been reported based on formal representation and analysis of resource flow in the supply chain system. In this work, a novel framework is proposed using Generalized Stochastic Petri-net (GSPN) model towards handling this issue in a distributed scenario. The analysis on the stochastic nets allows identifying the bottlenecks in the supply chain echelons along with customer relationship management (CRM). This has been used to rebuild infrastructure with the end-objective of reducing the BWE