In a supply chain, as information about product demand moves from one company to another, it can get distorted, leading to wrong decisions about how much to make or store. This confusion is called the "bullwhip effect." The further back in the chain you go, the bigger the distortion. The main reasons for this mix-up are how demand signals are processed, games played with limited supply, grouping orders together, and changes in prices. To fix this problem, companies can take certain actions to lessen its impact.