THE IDEA

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.

WHERE IT BREAKS

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 ↗