How would you restock after a demand surprise?
Forecasting and inventory adjustments can amplify variation as orders travel through a chain.
Inside this model
Demand starts at 20, jumps by the chosen amount on day 4, then returns. Each stage orders its current input plus reaction × the change in that input from the previous day, clipped at zero. The plot shows retail demand and a two-stage illustrative order chain.
Out in the world
A practical use
A retailer ordering extra after a short sale spike may send a much larger signal to suppliers.
A useful lens. Not a universal law.
- This is a transparent amplification toy, not an inventory-optimized supply chain with lead times or backorders.
Associated thinkers
Further reading
Explore the original research or the teaching reference behind this experiment.
Jay Forrester — Industrial Dynamics After the First Decade ↗