Tuesday, March 6, 2012

The Bullwhip Phenomenon in the Management of an Oil Refinery
©2012 INSEAD Case Study
Also available: Teaching Note

The case examines the impact of variability in demand and the supply chain on the operations of an oil refinery. The impact of external financial metrics by other stakeholders in the refinery is discussed, and policy measures for the improvement of the operations of the oil refinery are proposed.

Pedagogical Objectives: The objective of the case is to describe a real life situation in the oil industry, where the financial standards the refinery is held to dictate its inventory and supply chain management policies. it analyses the impact of negotiating more meaningful measurement techniques with the agencies on the operations and the financial stability of the oil refinery. The case illustrates the importance of aligning incentives on supply chain performance in the oil industry.