Indexing the archive…
Your Universe of Digital Possibilities
Customers buy a steady four cases a week, then eight. Four honest managers, each ordering sensibly from the orders they see, turn that one step into a wave that swamps the factory.
Anchor on the demand you expect, then adjust toward the stock you want (S*) and the supply line you should have (SL*). β is the weight a manager gives what is already on order: Sterman’s players gave it about a third. At β = 0 The Whip’s step game is still swinging at week 104; at β = 1 it settles.
An order-up-to stage that forecasts by a p-period moving average and covers a lead time of L periods, under AR(1) demand of correlation ρ: equality when it keeps no safety stock. Long windows and short lead times damp the whip. In The Whip’s engine (L = order + shipping delay) the retailer measures 3.47 against 3.46 at L = 3, p = 4, ρ = 0.5.
The Generals relayed every message so the loyal could agree; the beer game relays only orders, and four reasonable managers disagree with the customers by a factor of a hundred. Nothing is broken — the information is local. The same delayed feedback runs The Jam’s stop-and-go waves and The Tide’s lagging oscillations; The Grid is the case where the line must answer in milliseconds.