What is the definition of the Houlihan effect in logistics?

The Houlihan effect in logistics refers to a phenomenon where inaccurate or unreliable forecasting and purchasing decisions lead to inefficiencies in supply chain management. Named after its proponent, Brigadier General Andrew P. Houlihan, the term highlights the adverse consequences of relying on flawed demand forecasts and inadequate inventory management practices. This effect results in imbalances between supply and demand, leading to excess inventory, stockouts, increased costs, and decreased customer satisfaction. Understanding and mitigating the Houlihan effect requires accurate forecasting, robust inventory management, and effective communication throughout the supply chain.

This mind map was published on 15 November 2023 and has been viewed 81 times.