Which of the following best describes what happens when order volumes from customers increase and multiply through the supply chain?

Which of the following best describes what happens when order volumes from customers increase and multiply through the supply chain?
A . Pareto curve
B . Opitz system
C . Forrester effect
D . Seasonal demand

View Answer

Answer: C

Explanation:

The bullwhip effect (or Forrester effect) is a distribution channel phenomenon in which forecasts yield supply chain inefficiencies. It refers to increasing swings in inventory in response to shifts in customer demand as one moves further up the supply chain.

Seasonal demand: consumer interest in purchasing particular products only during a specific peri-od within the calendar year.

OPITZ is a coding system used to form Groups in Group Technology philosophy of Manufacturing.

The Pareto Curve is the shape created when the bars of a Pareto Chart are progressively summed and the points joined together. The final curve ends at 100% of items in the chart, which means that you can then draw a line across at 80% and ‘bounce’ it down to find the bar which, when combined with all bars to its left, will give 80% of all items.

Reference: CIPS study guide page 112

LO 2, AC 2.3