Enhancing supply chain solutions with the application of chaos theory

Abstract

PurposeThe purpose of this article is to expand the base of supply chain knowledge by applying chaos theory principles to selected supply chain functions.Design/methodology/approachResearchers borrow chaos theory from the natural sciences, provide a basic explanation, and then examine how it may be applied to enhance supply chain management techniques.FindingsChaos theory principles are used to assist in the examination of forecasting, product design, and inventory management challenges currently facing supply chain practitioners.Research limitations/implicationsApplication of chaos theory to various supply chain issues and key functional areas may produce an increase in the level of understanding of supply chain ambiguity and how chaos theory may provide valuable insight into the effective management of supply chain networks.Practical implicationsWhen applied correctly, chaos theory shows potential to be a tool that can be instrumental in helping explain why unpredictability occurs within nonlinear systems. A better understanding of this phenomenon may help researchers to develop better, more accurate models to assist managers in making better supply chain management decisions, benefiting organizations and customers by simultaneously enhancing cost‐effectiveness and improving customer service levels.Originality/valueThe principles of chaos theory have been introduced as a method that shows early promise as a tool to enhance supply chain effectiveness. Specific applications must now be examined through empirical research.