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Inventory and ordering decisions: a systematic review on research driven through behavioral experiments

H. Niles Perera (Department of Transport and Logistics Management, University of Moratuwa, Moratuwa, Sri Lanka) (Institute of Transport and Logistics Studies, The University of Sydney, Sydney, Australia)
Behnam Fahimnia (Institute of Transport and Logistics Studies, The University of Sydney, Sydney, Australia)
Travis Tokar (Department of Information Systems and Supply Chain Management, Texas Christian University, Fort Worth, Texas, USA)

International Journal of Operations & Production Management

ISSN: 0144-3577

Article publication date: 2 June 2020

Issue publication date: 20 November 2020

1208

Abstract

Purpose

The success of a supply chain is highly reliant on effective inventory and ordering decisions. This paper systematically reviews and analyzes the literature on inventory ordering decisions conducted using behavioral experiments to inform the state-of-the-art.

Design/methodology/approach

This paper presents the first systematic review of this literature. We systematically identify a body of 101 papers from an initial pool of over 12,000.

Findings

Extant literature and industry observations posit that decision makers often deviate from optimal ordering behavior prescribed by the quantitative models. Such deviations are often accompanied by excessive inventory costs and/or lost sales. Understanding how humans make inventory decisions is paramount to minimize the associated consequences. To address this, the field of behavioral operations management has produced a rich body of research on inventory decision-making using behavioral experiments. Our analysis identifies primary research clusters, summarizes key learnings and highlights opportunities for future research in this critical decision-making area.

Practical implications

The findings will have a significant impact on future research on behavioral inventory ordering decisions while informing practitioners to reach better ordering decisions.

Originality/value

Previous systematic reviews have explored behavioral operations broadly or its subdisciplines such as judgmental forecasting. This paper presents a systematic review that specifically investigates the state-of-the-art of inventory ordering decisions using behavioral experiments.

Keywords

Acknowledgements

This study was funded by the Australian Research Council (Grant ID: IC140100032).

Citation

Perera, H.N., Fahimnia, B. and Tokar, T. (2020), "Inventory and ordering decisions: a systematic review on research driven through behavioral experiments", International Journal of Operations & Production Management, Vol. 40 No. 7/8, pp. 997-1039. https://doi.org/10.1108/IJOPM-05-2019-0339

Publisher

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Emerald Publishing Limited

Copyright © 2020, Emerald Publishing Limited

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