All posts by Willy Michaell

The excessive fluctuation in the supply chain by the whip effect

The bullwhip effect in the supply chain can cause stock problems and additional costs as well as affect customer satisfaction. For instance, an excessive increase in production can lead to a lack of control in each of the logistical commitment processes in all the companies involved. This can be called bullwhip effect.

Resultado de imagen de efecto del latigo

How the whip effect is triggered

The bullwhip effect is the tendency to an excessive fluctuation of inventories and orders in the supply chains that does not correspond with the actual demand of the customers. It is then that the small variations in a certain point of the chain are increasing and moving to all the procedures as the chain progresses, producing inventory problems in its wake.

If there is no constant information and feedback on the inventories and the current demand of the consumer in the different links in the supply chain, the whip effect generates over stock and, as a consequence, the final product is radically made more expensive.Such whipping in supply chain fluctuations increases the costs associated with inventory, transportation, shipping and receiving, etc

¿what factor cause the bullwhip effect?

  • Lack of information between suppliers and intermediate buyers.
  • Management without order in production orders.
  • Lack of precision in the forecast of demand
  • Making panic-driven orders in situations of stock breach

How to Avoid the Whip Effect ¿what factor cause the bullwhip effect?

  • Get the supply chain to react to sales immediately.
  • Planning in the warehouse management with a good forecast of the demand
  • Understand the behavior of demand peaks and seasonality of products.
  • Ability to integrate Just In Time dynamics to strengthen integration and synchronization with customers and suppliers.

In this way we will be able to adapt the client’s demands with the fluctuations of our supply chain in a correct and farsighted way.








The productivity of a logistics center depends to a large extent on the efficiency of the picking process. Therefore, the parameters that I consider most important before selecting this process are the performance, flexibility and ergonomics of the picking system.

As we have already learned in class, there are 3 modes to make the picking, which will not cease to exist even if a picking system is included.

  • Goods to Person

The required articles are brought from the warehouse to the selector by means of conveyor technology. The picker collects the products for an order in one or several containers.

Example: Flexible voice-based solutions


  • Person to Good

The selector moves within specific zones of the goods, selects the desired number of items and places them in a container of orders.

 Link: Example

  • Automatically

In this case no manual action is required.

method that best fits a company depends on the specific application, however, four parameters must be considered before deciding on a specific solution:

Range of articles
Average order size
• Frequency of picking
• Weight and dimensions of the articles


The 4 major drawbacks of warehouse design

I believe that warehouses are a critical necessity in the global chain to satisfy customers and therefore a poorly designed warehouse design can be an essential element in having a logistics problem in a Company.

Despite this element, I consider that the supply chain faces two other important barriers, such as the determination of picking techniques and the choice of technology. That is why given my experience, I will mention other extra points to the class, which would be important to keep in mind when designing a store.


Photographic credits: macrovector

I.   Fixed costs. Always contemplate the investment (from the racks to conveyors, from forklifts to picking systems).  

II.     The difficulty of coordination with other functions, such as distribution and transportation. In this point there must be the flexibility and agility to adaccionar to the high peaks both the input and the delivery (output) of the warehouse. 

III.     What was considered optimum can stop being fast, so always take in to account the existence of a percentage of uncertainty in all the steps of the design. Example; (The internal flows of your warehouse may vary as well as the type of unit load. 

 IV.   Take into account that at some time the scope of the warehouse design is exceeded, so you can keep articles, boxes and pallets in the most unexpected places, but do not design to take everything that you do not have.

´´Remember that by introducing changes in warehouse design to achieve greater efficiency and more dynamism, increase supply chain sustainability´´.

Pokayoke and Supply Chain

Pokayoke is a simple technique that was developed from Toyota’s production system (Lean methodology) and usually consists in a simple and low-cost device that prevents errors from occurring or detects them, so that you do not go to the next operation. This way of working increases the effectiveness of control by overcoming the inefficiencies of inspection.

The supply chain benefits from pokayoke. Examples are the following situations:

Detection of human errors, alert for something inevitable in daily operations and giving the opportunity to step back and correct them on time.

Detection of simple errors, such as the existence of duplicates, in shipments or documentation:

Detection of mistakes that would otherwise have been unforeseen, spelling mistakes that affect the direction of a shipment, errors in punctuation marks that vary the amount of an invoice or any other similar type of failure that can negatively influence the reputation. , Customer confidence and its positioning in the market.

Example of Pokayoke:


The transport of the merchandise can be affected by a bad choice in the packaging of the product. As we have discussed in class, there are many factors to take into account, the most important are:

  • The stability of the load.
  • The amount of unit load to be carried.
  • The change in transport or in the vehicle.
  • The type of good of the commercial exchange.
  • The unitary load standards across the supply chain.
  • Resistance of packaging material to climatic changes.
  • The distance that will have to travel in the transport.
  • The intensity of the manipulation to which it will be subjected during the journey and until reaching its destination.

Based on these factors will have to determine the most suitable type of packaging, which will help to prevent the breakage of goods, their loss or deterioration.


From my point of view, choosing the packaging is an important decision. Consider commercial and marketing aspects, such as consumer tastes in the destination country or the trend in the local market; But also the practical part should be evaluated. Must be assessed:

  • The adequacy of the manipulation.
  • The need to contain, isolate or protect depends on the product.
  • The applicable regulations: which may require the packaging to include certain information or its translation into the local language.


However, in all the different packaging options, it is necessary to take into account the Price, Risk and Normative.

Backhaul: taking advantage of returning vehicles

In many cases you have been seen, how a vehicle made a full delivery and went back to its point of return with empty hands. It is customary to think that this is what happens when making deals but, would be better to go to deliver a package and return to your starting point with another type of merchandise taking advantage of the trip. (This exists in the world of logistics and it´s called backhaul).

Often, backhaul is used in different types of companies, specially in centralized distribution companies such as beverages, household items and those who use some kind of waste to incorporate back into their process and obtain a benefit.

Examples :


The idea is simple; Once the merchandise is delivered, on the way back the vehicle is stopping to those companies that have to return merchandise, products or packaging to the point of return. This type of reverse logistics that is characterized by the return of travels with useful merchandise, brings many benefits for companies that opt for it:

  • Increased workload.
  • Save time in deliveries.
  • Supply more customers.
  • Higher priority to customers.
  • It can be seen as a new way of business.
  • Cost optimization. Cost reduction in the company that supply the material and the company that collect the merchandise.

When the company do the normal route and the return, prevents that other suppliers have to go to the distribution company with the load. With this measure is less contaminated because less CO2 is emitted to the atmosphere by the reduction of trips of the trucks.

When designing a backhaul strategy you have to take into account mainly the planning of delivery routes and collection.

                                                                                                                                    Willy M. De Leon


The general focus for the effect of  the distribution of work centers is to order workplace with similar processes in order to optimize their relative location. In many facilities optimum location often means that large volume work centers between departments are placed side by side.

In my years of experience, I have been able to know the different basic formats of distribution can be: Distribution by functions, assembly line and distribution by project.

Distribution by functions, occur when a group of functions or similar equipment, are located in the same are of work in the company. The parts in production advance with a preset sequence of each operation. This type of distribution is common in Hospitals (maternity rooms, intensive care unit).

A good example of this distribution, was the one known through the visit to FORD company, where the work areas are divided by specific functions, (Painting, welding, molding, mechanics). But also they have a assembly lines at the end of the production chain.

The assembly lines, are present when the route of the product or the parts that compose it are in straight line while the transformation or assambly occurs, such as car washes. This is very used in large volumes of production, specially in textile factories or production of alcoholic and non-alcoholic beverages.

The distribution by project, in this case the product stays fixed in a place during its manufacture and the production equipment goes to the product. This is common in products with a high weight, as a boat manufacturing amd plane manufacturing.

Cells (Celdas)

This is a hybrid between assanble lines and work centers (distribution by functions). It is widely applied because of its flexibility to work and maximum utilization of human labor. The image shows some of the ways that improvements to assembly lines can take.


My purpose with this topic is, recommend to all the class group the use of U-cells to facilitate human relations, improve the experience of each participant, have less material on the study table and prepare faster assignments made in class.

Reference: Operations management (Production and supply chain) Chase, Richard ; 2009