The effect of risk taking by decision making teams on the order stability in supply chains: Exploring risk attitude as a behavioural factor influencing the bullwhip effect
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2018-07-10
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en
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Abstract
Literature widely explores factors causing the bullwhip effect. However, less is known about behavioural factors influencing this phenomenon. Previous research indicated that risk attitude might be an important behavioural factor. Therefore, this experimental research assessed the effect of risk attitude of a team of decision makers on the variance of orders placed by a team (i.e. the bullwhip effect), using the Beer Game. Additionally, it investigates whether team diversity and risk perception influence this relation. Teams who played the Beer Game consisted of decision makers with the same risk attitude, with different compositions in terms of gender and country of origin. Evidence was found that decision making teams who were risk averse created a larger bullwhip effect than risk seeking decision making teams. This was especially true upstream the supply chain and when the team consisted of culturally diverse decision makers. Risk attitude seems to be an important behavioural factor influencing the bullwhip effect, indicating that it is worthwhile to take the risk attitude of supply chain employees into consideration, as a selection criterion in application processes.
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Faculteit der Managementwetenschappen