Abstract

Emergent technologies, such as the `blockchain,' are enabling unprecedented coordination across firms in Supply Chains (SC). Firm decision-makers ultimately are going to need to understand how they can control (and optimize) such a network of relationships. However, the study of SC-level behavior leaves many open questions. Current approaches typically assume a focal firm, and the modeling of SC behavior is usually limited to single-product serial networks. In contrast, real-world SCs show that often a firm has many suppliers, even for the same raw material. This paper aims to understand how demand disturbances (e.g. the 'bullwhip effect') propagate and intensify throughout the SC. We find that having a structure that enables managerial decision making (policy) is not enough to amplify these disturbances. Rather, the structure has to be accompanied with a dynamic policy to see changes in demand disturbances. We also explicate a novel and scalable model for a SC. The model can be used in future research to test the implications of our main result: diversifying a firm's supplier-base has the potential to amplify disturbances more quickly.

Degree

College and Department

Computational, Mathematical, and Physical Sciences; Computer Science

Rights

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