Developing a Systemic Framework to Reduce the Bullwhip Effect in the Construction Industry: Empirical Insights and Practical Implications
Year: 2025
Type: article
Abstract: Background The construction industry faces systemic inefficiencies and cost overrun. Many of these issues result from demand amplification, known as the Bullwhip Effect (BWE), within supply chains. Aim To investigate the root causes and impacts of the Bullwhip Effect during construction. Establish a foundation for mitigation strategies using a conceptual framework. This framework was validated using a real-world case study to support effective mitigation. Methods This study systematically identified and analyzed twenty-one underlying causes of the Bullwhip Effect in the supply chain. The effect was calculated for the selected construction materials using data from Mostashar United Company-Kuwait. Results The Bullwhip Effect in the construction industry emerges not from a single cause but from a complex interaction of factors that significantly influence the phenomenon and are deeply embedded within the industry’s structural and operational practices. These causes are grouped into three main dimensions: informational, operational, and behavioral factors. BWE can be quantitatively measured and directly escalates production costs and intensifies over time if mitigating strategies are not implemented. Research has identified several strategies that can effectively prevent the occurrence or reduce the bullwhip effect in the construction industry, such as collaboration and teamwork enhanced strategies between SCM partners, optimizing information exchange and communications among SCM partners, Building SCM Resilience Against Component Shortages, and Strategic Planning for Resource Utilization. Conclusion The causes of Bullwhip Effects and impacts are interconnected rather than segregated or isolated, creating a reinforcing feedback loop where informational opacity sparks behavioral reactions, further intensifying operational instability. A bullwhip mitigation policy should include addressing data transparency, supply chain process coordination, and contractual early incentives, instead of focusing on isolated symptom management, instead of systemic resolution.
Source: F1000Research
Institutions: Hashemite University, Al Yamamah University
Language: English
Subfield: Management Information Systems
Domain: Social Sciences
Open Access status: gold
Estimated APC paid: $1,350
OpenAlex ID: W4416509477