The Root Beer Game Simulation

Forio Group. (2011). Root beer game demo. HBR. Retrieved from http://forio.com/simulation/harvard-root-beer-game-demo/login" rel="nofollow">in.htm Runnin" rel="nofollow">ing the simulation in" rel="nofollow">involves the followin" rel="nofollow">ing steps: •Review the Simulation Summary, Your Role, and How to Play sections under the Prepare tab. •Go to the Analyze tab to run the simulation. •Submit your weekly order in" rel="nofollow">in the Enter Order field; at least 20 rounds are necessary to get a good feel for the problems in" rel="nofollow">involved. •When fin" rel="nofollow">inished, review your performance under the Dashboard Overview, Inventory and Shipments, Orders and Backlog, and Cost Detail tabs. It sounds easy, right? Try it and see how good you are at gettin" rel="nofollow">ing root beer to your customers while keepin" rel="nofollow">ing your in" rel="nofollow">inventory and costs low. See if you can control the bullwhip oscillations of stock-outs followed by over-supply. To run the simulation several times, you will need log out and start again" rel="nofollow">in. The log out command is on the bottom left side of the page. Spend a maximum of 30 min" rel="nofollow">inutes workin" rel="nofollow">ing with the game. Then thin" rel="nofollow">ink about it in" rel="nofollow">in conjunction with this module's readin" rel="nofollow">ings for perhaps another 15-20 min" rel="nofollow">inutes. address the followin" rel="nofollow">ing questions: 1.What did you do in" rel="nofollow">in the simulation? What activities did you engage in" rel="nofollow">in? What did you learn about what's goin" rel="nofollow">ing on? 2.What have you learned about supply chain" rel="nofollow">in management from your participation in" rel="nofollow">in this simulation? you will be personally experiencin" rel="nofollow">ing the importance of supply chain" rel="nofollow">in management (SCM) through a simulation exercise. Your job is to fully understand the components of SCM and how they are broken down in" rel="nofollow">into parts. SCM in" rel="nofollow">includes the customer as the in" rel="nofollow">input and output in" rel="nofollow">in the chain" rel="nofollow">in through plannin" rel="nofollow">ing, purchasin" rel="nofollow">ing, in" rel="nofollow">inventory, production, and transportation. SCM ensures that products and services are delivered efficiently usin" rel="nofollow">ing IT and related applications such as enterprise resource plannin" rel="nofollow">ing (ERP), Oracle, and SAP. More specific applications in" rel="nofollow">include customer relation analysis (CRA), material resource plannin" rel="nofollow">ing (MRP), and in" rel="nofollow">inbound and outbound logistic trackin" rel="nofollow">ing systems, among others. These applications in" rel="nofollow">integrate to the full value chain" rel="nofollow">in and in" rel="nofollow">interface with customers and suppliers via the Internet and mobile technology. The challenge of SCM is coordin" rel="nofollow">ination. Suppliers, manufacturers, sales people, and customers have their own, often in" rel="nofollow">incomplete, understandin" rel="nofollow">ing of what real demand is. Each group has control over only a part of the supply chain" rel="nofollow">in, but each group can in" rel="nofollow">influence the entire chain" rel="nofollow">in by orderin" rel="nofollow">ing too much or too little. Furthermore, each group is in" rel="nofollow">influenced by decisions that others are makin" rel="nofollow">ing. This lack of coordin" rel="nofollow">ination coupled with the ability to in" rel="nofollow">influence while bein" rel="nofollow">ing in" rel="nofollow">influenced by others leads to what Stanford's Hau Lee refers to as the Bullwhip Effect. Decisions made by groups along the supply chain" rel="nofollow">in may actually worsen shortages or overstocks. The bullwhip effect is illustrated by a story Lee tells about how Volvo found itself with extra in" rel="nofollow">inventories of green cars. To get them off the dealers' lots, Volvo's sales department offered special deals, so demand for green cars in" rel="nofollow">increased. Production, unaware of the promotion, saw the in" rel="nofollow">increase in" rel="nofollow">in sales and ramped up production of green cars. Coordin" rel="nofollow">ination is not just about communication. Even in" rel="nofollow">in supply chain" rel="nofollow">ins where communication is perfect, manufacturin" rel="nofollow">ing and procurement delays can wreak havoc. While customers are orderin" rel="nofollow">ing, backlogs can build, and it is easy to confuse backlogged orders with in" rel="nofollow">increases in" rel="nofollow">in demand.