1 the beer game debriefing. 2 the blame game how did you feel? who did you blame?
Post on 18-Dec-2015
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1
THE BEER GAME DEBRIEFING
2
The Blame Game
How did you feel?
Who did you blame?
3
Summary of Each Team’sOrders, Inventories, & Total Cost
Go to Excel Workbook
4
CHARACTERISTICS OF THE GRAPHS OF WEEK-BY-WEEK
ORDERS AND INVENTORY
Oscillation “Peaks” and “Valleys”
Amplification of Orders Placed As RWDF, there are higher and higher peaks
and lower and lower valleys.
Phase Lag As RWDF, the start of an increase to a peak
or a decrease to a valley occurs later and later.
5
A FINANCIAL NEWS REPORT“On Wall Street today, news of lower interest rates sent the stock market up,
but then the expectation that these rates would be inflationary sent the market down,
until the realization that lower rates might stimulate the sluggish economy pushed the market up,
before it ultimately went down on fears that an overheated economy would lead to a reimposition of higher interest rates.”
From a cartoon by Mankoff (October 12, 1981).
6
MOTOROLA ARTICLE
From Business Week, March 6, 1995.
7
U.S. ECONOMY
8
HOW CAN WEIMPROVE PERFORMACE?
Understand how the game’s structure influences the behavior of the players.
Supply Chain Management
9
“Take two aspirin and wait!”
“If you have a headache and need to take aspirin, you don’t keep taking aspirin every five minutes until your headache goes away. You wait patiently for the aspirin to take effect, because you know that aspirin operates with a delay.”
From The Fifth Discipline, by Peter M. Senge, 1990.
10
Panic!!!(Order Placed) = (Recent Incoming Order)-(Inventory)+(Backlog)
(NOTE: If above quantity is < 0, then reset Order Placed to 0.)
Order Quantity (week-by-week)
0
500
1000
1500
2000
2500
0 5 10 15 20 25 30 35
Week
Ord
er
Qu
anti
ty
Retailer Wholesaler Distributor Factory
INVENTORY (week-by-week)Total Cost = $208,864
(2000)
(1000)
0
1000
2000
3000
4000
5000
6000
0 5 10 15 20 25 30 35
Week
Inve
nto
ry
Retailer Wholesaler Distributor Factory
11
1-for-1 Ordering
(Order Placed) = (Incoming Order)
Order Quantity (week-by-week)
012345678910
0 5 10 15 20 25 30 35
Week
Ord
er Q
uant
ity
Retailer Wholesaler Distributor Factory
INVENTORY (week-by-week)Total Cost = $3232
(32)(28)(24)(20)(16)(12)(8)(4)04812
0 5 10 15 20 25 30 35
Week
Inve
ntor
y
Retailer Wholesaler Distributor Factory
12
A “Scientific” PolicyFor R,W,D: (Order Placed) = 16–(Inventory)+(Backlog)–(Undelivered Orders)
For F: (Order Placed) = 12–(Inventory)+(Backlog)–(Undelivered Orders)
(NOTE: If above quantity is < 0, then reset Order Placed to 0.)
Order Quantity (week-by-week)
0
4
8
12
16
20
24
0 5 10 15 20 25 30 35
Week
Ord
er Q
uant
ity
Retailer Wholesaler Distributor Factory
INVENTORY (week-by-week)Total Cost = $304
(4)
0
48
12
16
20
0 5 10 15 20 25 30 35
Week
Inve
ntor
y
Retailer Wholesaler Distributor Factory
13
Perfect InformationWhat if it were known in advance that the customers’ week-by-week demand would be 4-4-4-4-8-8-8-8-8-…?
Order Quantity (week-by-week)
012345678910
0 5 10 15 20 25 30 35
Week
Orde
r Qua
ntity
Retailer Wholesaler Distributor Factory
INVENTORY (week-by-week)Total Cost = $144
(4)
0
4
8
12
0 5 10 15 20 25 30 35
Week
Inve
ntor
y
Retailer Wholesaler Distributor Factory
14
AND THE WINNER IS …
???
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