Background: An organization's ability to control bound material can be the difference between success or failure. Organizations that effectively work with supply chain management has strengthened their positions and increase their competitive edge on the global market. Organizations is the pharmaceutical industry has a major social responsibility by ensuring a continuous flow of medicines as well as pharmaceutical equipment. The industry is controlled by the strict regulations. The stringent security requirements for delivery reliability and delivery precision combined with extensive production regulations have resulted in these organizations having difficulty in maintaining even inventory levels.   Purpose: The study aims to investigating the correlation between high level of safety requirements in the pharmaceutical industry and high inventory levels with the help of a case study. The study wants to investigate consequences of such connection as well investigate potential solution in which organizations can reduce their inventory levels without jeopardizing the delivery precision and delivery safety of pharmaceutical organizations.   A case study has been conducted at the pharmaceutical company Fresenius Kabi who is a global market leader in the production of intravenous nutritional solutions.   Finding: Findings of the study indicates that safety requirements controlling the pharmaceutical industry have a major impact on the organization's production planning and storage. The consequences of the high security requirements results in in uneven production patterns and tied capital in high inventory levels. The consequences also indicated on a Bullwhip-effect. Lean management enables organizations in the pharmaceutical industry to establish even production patterns and reduce their inventory levels.   The study presents a new factor that prevents organizations in the pharmaceutical industry to reduce the number of articles. The new factor has a strong link to why organizations in the pharmaceutical industry have high inventory levels. / Bakgrund: Hantering av lager och uppbundet material kan vara avgörande för en organisations framgång eller misslyckande. En ökad globalisering av dagens marknad har lett till att organisationer som effektivt arbetar med supply chain management stärker sina positioner och ökar sina konkurrensfördelar. En bransch på den globala marknaden som verkar under håra regleringar är läkemedelsbranschen. Branchen har ett stort samhällsansvar genom att säkerställa ett kontinuerligt flöde av läkemedel samt läkemedelsutrustning. De hårda säkerhetskraven på leveranssäkerhet och leveransprecision i kombination med omfattande produktionsregleringar har resulterat i att dessa organisationer har svårt att upprätthålla jämna lagernivåer. Syfte: Med hjälp av en fallstudie vill studien undersöka hur sambandet mellan höga säkerhetskrav och höga lagernivåer inom läkemedelsbranschen ser ut. Studien vill undersöka hur sambandet påverkar organisationer inom läkemedelsbranschen samt analysera hur man medhjälp av olika åtgärder kan minska lagernivåer utan att äventyra organisationernas leveransprecision och leveranssäkerhet. Fallstudien är baserad på läkemedelsorganisationen Fresenius Kabi. Fresenius Kabi är en global aktör som är marknadsledande inom produktion av intravenösa näringslösningar. Studien har undersökt produkten smofkabvien som produceras i Uppsala i syfte till att besvara studiens frågeställning. Med hjälp av intervjuer och insamlad sekundärdata besvaras studiens syfte. Slutsats: Studienkonstaterar att säkerhetskraven som reglerar läkemedelsbranschen har en stor inverkan på organisationens produktionsplanering och lagerhållning. Resultatet av de höga säkerhetskraven resulterar i ojämna beställning-och produktionsmönster vilket resulterar i hög kapitalbindning samt indikerar på en potentiell Bullwhip-effekt inom försörjningskedjan. Med hjälp av Lean management, heijunka och just-in-time kan organisationer inom läkemedelsbranschen upprätta jämna produktion-och beställningsmönster samt reducera sina lagernivåer. Studien presenterar en ny faktor vilken förhindrar organisationer inom läkemedelsbranschen möjlighet att reducera antalet artiklar. Den nya faktorn har en stark koppling till varför organisationer inom läkemedelsbranschen höga lagernivåer.

The bullwhip effect is defined as an upstream amplification of demand variability and has received interest within multinational companies for decades. As early as in the 1950’s, Forrester (1958) discussed what is today known as the bullwhip effect, which has a negative impact on the customer service, costs, and inventory investment in a supply chain (Lee et al., 1997). Even though the bullwhip effect has been noticed in various industries, the consequences, in form of decreased availability and increased costs the further up the supply chain the bullwhip goes, still remain. The employees at Volvo Group Service Market Logistics suspect that their supply chain has been affected by the bullwhip effect and want to know if it is correct and subsequently know why it has occurred. Therefore, this master’s thesis highlights the root causes of the bullwhip effect and presents strategies to mitigate it. To understand how the bullwhip effect affected the Volvo Group Service Market Logistics’ supply chain, the purpose was formulated as follow: The purpose of this study is to identify events in the Volvo Group Service Market Logistics’ supply chain where the bullwhip effect has occurred, its root causes, and how to reduce or eliminate the bullwhip effects.  The studied flow was from the Central Distribution Center (CDC) in Ghent, to the Regional Distribution Center (RDC) in Brazil, to the Dealers associated to the RDC in Brazil, and the customers. Data was collected from each node and events were studied to find bullwhip events. After sorting out the part numbers that passed the criteria for bullwhip events, the amount of data had to be reduced even more. A couple of different conditions were applied which resulted in four suitable bullwhip events. Thereafter, the authors conducted interviews with Logistics Managers at each node of the supply chain to find the root causes of the bullwhip effect in each studied event.  Among the several found root causes, lack of information transparency was the most frequent occurring root cause, found in three out of four studied bullwhip events. Insufficient communication and lack of information sharing cause bullwhip effects, and the authors found that improved communication both between and within the nodes will contribute to better planning, and consequently avoided bullwhip effects. Other root causes found were issues with the ordering system, lack of learning and experience, neglected lead times, fear of empty stock, price fluctuations, and phase-out of the spare part.  To reduce or eliminate the bullwhip effect, the focus was on mitigating the root causes since the root causes create opportunities for the bullwhip effect to occur. Four suggestions were given with suitable mitigation strategies found in the literature, where the four suggestions were sales campaigns, prepare for boosts, keep track of manually placed orders, and ordering system and Logistics Manager behavioural issues. The suggestions could then be connected to the different found root causes. The stated suggestions and mitigation strategies focused on mitigating the root causes in a long-term perspective and consequently the bullwhip effect itself.