To read the full version of this content please select one of the options below:

System dynamics modeling with fuzzy logic application to mitigate the bullwhip effect in supply chains

Mehdi Poornikoo (Department of Maritime Operations, University of South-Eastern Norway, Vestfold, Norway)
Muhammad Azeem Qureshi (Business School, Oslo Metropolitan University, Oslo, Norway)

Journal of Modelling in Management

ISSN: 1746-5664

Article publication date: 2 May 2019

Issue publication date: 18 September 2019

970

Abstract

Purpose

A plethora of studies focused on the cause and solutions for the bullwhip effect, and consequently many have successfully experimented to dampen the effect. However, the feasibility of such studies and the actual contribution for supply chain performance are yet up for debate. This paper aims to fill this gap by providing a holistic system-based perspective and proposes a fuzzy logic decision-making implementation for a single-product, three-echelon and multi-period supply chain system to mitigate such effect.

Design/methodology/approach

This study uses system dynamics (SD) as the central modeling method for which Vensim® is used as a tool for hybrid simulation. Further, the authors used MATLAB for undertaking fuzzy logic modeling and constructing a fuzzy inference system that is later on incorporated into SD model for interaction with the main supply chain structure.

Findings

This research illustrated the usefulness of fuzzy estimations based on experts’ linguistically and logically defined parameters instead of relying merely on the traditional demand forecasting based on time series. Despite the increased complexity of the calculations and structure of the fuzzy model, the bullwhip effect has been considerably decreased resulting in an improved supply chain performance.

Practical implications

This dynamic modeling approach is not only useful in supply chain management but also the model developed for this study can be integrated into a corporate financial planning model. Further, this model enables optimization for an automated system in a company, where decision-makers can adjust the fuzzy variables according to various situations and inventory policies.

Originality/value

This study presents a systemic approach to deal with uncertainty and vagueness in dynamic models, which might be a major cause in generating the bullwhip effect. For this purpose, the combination between fuzzy set theory and system dynamics is a significant step forward.

Keywords

Citation

Poornikoo, M. and Qureshi, M.A. (2019), "System dynamics modeling with fuzzy logic application to mitigate the bullwhip effect in supply chains", Journal of Modelling in Management, Vol. 14 No. 3, pp. 610-627. https://doi.org/10.1108/JM2-04-2018-0045

Publisher

:

Emerald Publishing Limited

Copyright © 2019, Emerald Publishing Limited

Related articles