Information systems affect supply chain profitability by ________.
A) increasing inventories
B) checks and balances
C) eliminating the bullwhip effect
D) adding more vendors to the supply chain

Question

Quizplus · Accepted Answer

Information systems can help eliminate the bullwhip effect, which is a phenomenon where demand variability increases as one moves upstream in the supply chain. This can lead to excess inventory, inefficient production, and increased costs. By providing better visibility into customer demand and inventory levels, information systems can help companies better manage their supply chains and reduce the bullwhip effect, ultimately improving profitability. Options A and D are incorrect because increasing inventories and adding more vendors can actually increase costs and decrease profitability. Checks and balances could be helpful in ensuring the accuracy and reliability of the information system, but it may not have a direct impact on supply chain profitability.

Information Systems Affect Supply Chain Profitability by ________