The bullwhip-effect in the electricity supply

Péter Bajor ()
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Péter Bajor: Széchenyi István University

A chapter in Symposium for Young Researchers 2007: Proceedings, 2007, pp 19-25 from Óbuda University, Keleti Faculty of Business and Management

Abstract: The bullwhip-effect is a very costly phenomenon. Recent days the length of different supply chains become longer and longer. Due to the delays in the adaptation of changes, supply chains can be dynamically unstable with respect to perturbations in the consumption rate. It can lead to stock-outs, large and expensive capacity utilisation swings, lower quality products, and considerable production/transport on-costs as deliveries are ramped up and down at the whim of the supply chain. The first part of the paper presents the bullwhip-effect in the conventional logistics systems. The main goal of different type of studies to understand the nature of this harmful effect, and to investigate the best form of modelling – and to develop the best management tools and strategies. The second part contains the specialities of production, transportation, distribution and consumption of electrical energy, including the storage opportunities. We could not imagine our everyday life without the absolute availability of electrical energy, and this is a typical „pull” system, without significant storage possibilities in an economy, like the Hungarian one. At the first sight it seems free of the bullwhip-effect, because in this system we should follow the customer demands from moment to moment – but there are extremely high inventory levels in the inbuilt capacities of power stations. The analogies could be profitable on the conventional fields of logistics – and from this viewpoint, we could formulate useful theories for further bullwhip-effect modelling and simulation researches.

Keywords: bullwhip-effect; infrastructure (search for similar items in EconPapers)
Date: 2007
ISBN: 9789637154645
References: View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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