Hosoda, Takamichi and Disney, Stephen Michael ![]() |
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Abstract
This paper investigates the impact of mis-specifying the market demand process on a serially linked two-level supply chain. Box–Jenkins models are used to represent both the true and a mis-specified market demand processes. It is shown that the impact of mis-specification on cost is minor if the supply chain tries to minimise the market demand forecast errors. Furthermore, our analysis suggests that mis-specification does not always result in additional costs. A managerial insight is revealed; poor forecast accuracy is not always bad for the total supply chain costs. In other words, employing more accurate forecasting methods may actually result in higher total supply chain costs.
Item Type: | Article |
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Date Type: | Publication |
Status: | Published |
Schools: | Business (Including Economics) Centre for Advanced Manufacturing Systems At Cardiff (CAMSAC) |
Subjects: | H Social Sciences > HB Economic Theory H Social Sciences > HD Industries. Land use. Labor H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management H Social Sciences > HG Finance |
Uncontrolled Keywords: | Order-up-to policy; Base-stock policy; Mis-specification; Forecasting; Box–Jenkins model |
Publisher: | Elsevier |
ISSN: | 0925-5273 |
Last Modified: | 24 Nov 2024 04:45 |
URI: | https://orca.cardiff.ac.uk/id/eprint/18909 |
Citation Data
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