Not long ago, logistics executives at Procter & Gamble (P&G) examined the order patterns for one of their
best-selling products, Pampers. Its sales at retail stores were fluctuating, but the variabilities were
certainly not excessive. However, as they examined the distributors' orders, the executives were
surprised by the degree of variability. When they looked at P&G's orders of materials to their suppliers,
such as 3M, they discovered that the swings were even greater. At first glance, the variabilities did not
make sense. While the consumers, in this case, the babies, consumed diapers at a steady rate, the
demand order variabilities in the supply chain were amplified as they moved up the supply chain. P&G
called this phenomenon the "bullwhip" effect. (In some industries, it is known as the "whiplash" or the
"whipsaw" effect.)