A system dynamics approach for leveraging blockchain technology to enhance demand forecasting in supply chain management

Abstract

This study investigates the impact of blockchain technology on demand forecasting and the associated costs in supply chain management using system dynamics modeling. With the increasing complexity and challenges of demand prediction in modern supply chains, the potential of blockchain to enhance the accuracy of demand forecasting and reduce related costs has become a critical area of interest. The research employs system dynamics to model the interrelationships between key factors such as blockchain adoption, data accuracy, transaction transparency, and supply chain performance. The findings highlight that blockchain integration significantly improves demand forecasting accuracy by ensuring real-time data sharing, reducing information asymmetry, and enhancing decision-making processes. Moreover, the simulation results show that blockchain adoption can reduce forecasting errors, thereby lowering operational costs. This research contributes to the existing literature by demonstrating the practical benefits of blockchain in supply chain operations, offering valuable insights for practitioners and researchers. It also provides a foundation for future studies to explore the scalability of blockchain in different sectors and its broader applications in optimizing supply chain functions.