Frequency response analysis of inventory variation in production networks with information sharing

Abstract Previous discrete event simulation studies have found that information exchange can be beneficial to the various stakeholders in resource sharing networks. However, the fundamental dynamic behavior that produces these benefits has yet to be theoretically characterized and quantified. In this paper, frequency response analysis is used to predict the magnitude of inventory variations that result from different options for information sharing between and within entities in a production network. An example from the steel industry is used to illustrate how control theoretical models can be constructed and used to explain how variations in demand propagate through a production network.