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INTEGRATED LOGISTICS AND OPERATIONS: LEARNING THROUGH GAMES

August 31 – September 4, 2015

Professor: Glen Schmidt Office and Telephone: e-mail: glen.schmidt@utah.edu Course Description: We will further develop and refine our intuition and knowledge of operations and supply chain management using interactive games. The games will generally involve team participation and competition, and are computer or internet based. As a prerequisite, students are expected to have basic knowledge of operations and logistics management, however games can be played quite competently using qualitative analysis (good quantitative analysis may further enhance performance). Topics covered in playing the games may include product design, forecasting, pooling, the impact of variability, capacity management, managing bottlenecks, inventory management, managing lead times, customer responsiveness, and the bullwhip effect. It is anticipated that each student will come away with deeper insights in several of these areas. Also note that most of these principles apply to both service and manufacturing settings – the course is applicable to both.

PERFORMANCE EVALUATION

Game outcomes (35%)

Performance in each game is scored is some fashion. For example, the player or team may have the goal of maximizing firm profitability, where profitability is determined by the moves that the team makes in the game. Thus the game itself offers direct feedback. That is, proper application of management principles will lead to a better score in the game.

Reports (30%)

After each game, each participant (or team if it is a team-based game) will prepare a short report outlining how they made decisions regarding the moves to be made in the game. Further, the report will, in retrospect, describe why those were in fact the right moves to have made, or if not, what moves would have been better, and why.

Final exam (25%)

We will have a final exam to test students on the principles learned in playing the games.

Course participation (10%)

After each game we will have a class discussion to reinforce what was learned from the game. Students are expected to be active participants in all discussions, as well as in discussion with their team members outside of class (for those games involving teams). We may also give you the opportunity to make an oral presentation of your play of the game.

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Monday, Aug 31, Session 1: Review of some operations and logistics principles Readings:

1) “The curse of variability.” Teaching note by Glen Schmidt. 2) “Littlefield Overview.” 3) “Littlefield Assignment 1: Capacity Management.”

9:15 – 10:45: Classroom “Lecture” 11:00 – 12:30: Classroom “Lecture” 1:30 – 3:00 p.m. : Classroom “Lecture” Discussion: We begin by reviewing basic concepts in operations management (OM). It is important that we have a common understanding of the definitions of throughput time, throughput rate, processing rate, processing time, demand rate, variability in demand inter-arrival times, and variability in processing time. It is also important to define what we mean by the terms capacity utilization and bottlenecks. One of the key insights derived within the field of Op’s Management (OM) is that variability can have a devastating effect on the firm. I call this the “curse of variability.” In this session we look at a very simple model that helps us gain some insight into the impact of variability. We also begin a look at the Littlefield game. The reading “Littlefield Overview” gives a synopsis of the game while the document “Littlefield Assignment 1” gives information specific to the first assignment (we will run a second round of the game on day 4). The Littlefield simulation addresses the concepts of capacity management, inventory management, managing bottlenecks, pooling, managing lead times, the impact of variability, and customer responsiveness. Littlefield is a factory which assembles Digital Satellite System (DSS) receivers. These receivers are assembled from kits of electronic components procured from a single supplier. The assembly process consists of four steps carried out at 3 stations. The demand stream is uncertain but is characterized for players in general terms. Players must decide whether to cater to customers wanting short lead times, decide how much capacity to acquire, decide how to prioritize jobs, decide whether to split jobs into multiple lots, and must set reorder points and reorder quantities. You will play in teams. All teams must be exactly 2 people unless otherwise authorized by the instructor. To prepare for the Littlefield game, come up with a team name and password, and register your two-person team at http://quick.responsive.net/lt/himolde/start.html . You will need the code “throughput” to register.

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Tuesday, Sep. 1, Session 2: Review (cont.) and Play First Round of Littlefield Readings:

1. “The pooling principle.” Teaching note by Glen Schmidt. 2. “The OM triangle.” Teaching note by Glen Schmidt. 3. “The newsvendor model.” Teaching note by Glen Schmidt.

9:15 – 10:45: Classroom “Lecture” 11:15 – 12:45 p.m. (days 50 – 140 of game) 1:45 – 3:03 p.m. (day 140 – 218 of game with days 218 – 268 run “instantaneously) Discussion: We continue our review of operations concepts and play round 1 of the Littlefield 1 game. Littlefield Assignment: You will play the game at the exact times specified above. Everyone must be logged into the game during this exact time or you will not be able to play the game. You will access your game at the website below, but you will not be able to access the game until EVERYONE has registered for the game (to register, please see the details for Monday’s class). Once the simulator has started, access your team from http://quick.responsive.net/lt/himolde/entry.html . Your team should turn in a set of PowerPoint slides (12 maximum) describing how you played the game and, in retrospect, if you did not play it optimally, please describe how you SHOULD have played the game. Please turn in a printout of your slides printed 6 per page The slides must be easily readable at this resolution. Please also email your PowerPoint presentation to glen.schmidt@utah.edu. The assignment is due at the start of class on Wednesday.

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Wed., Sep. 2, Session 3: Play the Global Supply Chain Management Simulation Readings:

1) “Inventory Management Fundamentals.” 2) “Making Supply Meet Demand in an Uncertain World.”

9:15 – 10:45: Littlefield debrief 11:00 – 12:30: Classroom “Lecture” Afternoon is free to play the Global Supply Chain Management Simulation “at your leisure” Report due on Littlefield 1. We will hold a debrief on the initial Littlefield assignment. Teams will randomly be asked to present their slides (see the assignment for Tuesday for details on preparing the slides). Global Supply Chain Management Simulation: Continuing to focus on the impact of variability in demand, this session focuses on creative ways that the supply chain can be managed to efficiently use production capacity. The firm would like to smooth production such that resources are utilized even during times of slack demand, and are not over-utilized during times of peak demand. This type of problem is magnified in the ski-wear industry, in that sales are seasonal, and styles change from year to year. Furthermore, supply chains involve producers in one part of the world and consumers in other parts. The reading “Making Supply Meet Demand in an Uncertain World” offers some insights on how to manage capacity and inventory in this setting. The Global Supply Chain Management Simulation will allow you to design and manage the supply chain of a cell phone manufacturer over a multi-year period. You will be put in charge of the introduction of two models, and will be required to design the product line, forecast demand, choose a set of suppliers with different cost and lead-time characteristics, and allocate production among your chosen suppliers. After completing the product and supply chain design phase, you will observe actual monthly demand and will have opportunities to respond to unexpected events. The simulation is repeated over a four-year period, allowing you an opportunity to revisit and refine your decision processes each year. At the end of each year, the company's board of directors will evaluate your performance and your annual profits computed. Team performance will be revealed during the in-class simulation debrief. Running the simulation You should sign up just once at the web site given to you by your instructor, using the same team name as you used for the Littlefield simulation. We have paid for a limited number of slots so DO NOT sign up a second time. You and your teammate should find a time and location when you can take between 2 and 4 hours to run the simulation. The web site to play the game will be given to you by the professor. You first need to register as a student at the web site. As always, if you have problems, email the instructor. Assignment requirements: Your team should turn in a set of PowerPoint slides (12 maximum) describing how you played the game and, in retrospect, if you did not play it optimally, please describe how you SHOULD have played the game. Please turn in a printout of your slides printed 6 PER PAGE. The slides must be easily readable at this resolution. Please also email your PowerPoint presentation to glen.schmidt@utah.edu. The assignment is due at the start of class on Thursday.

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Thursday, Sep. 3, Session 4: Play Round 2 of Littlefield Readings:

1) Re-read the “Littlefield Technologies Overview” document. 2) “Littlefield Assignment 2: Managing Customer Responsiveness:”

9:15 – 10:45 in classroom 1:30 – 3:00 p.m. (days 50 – 140 of game) 3:30 – 5:00 p.m. (day 140 – 230 of game with days 231 – 366 run “instantaneously” Report due on Global Supply Chain Game. We will hold a debrief on the Global Supply Chain Game. Teams will randomly be asked to present their slides (see the assignment for Wednesday for details on preparing the slides). Round 2 of Littlefield

Today we will play round 2 of the Littlefield game. In the first round of the simulation you had limited opportunity to manage the facility, as you focused primarily on capacity (buying and selling machines). This time you will have the opportunity to make more decisions than in the first round. The second Littlefield simulation runs for almost 4 hours.

Assignment requirements: Your team should turn in a set of PowerPoint slides (12 maximum) describing how you played the game and, in retrospect, if you did not play it optimally, please describe how you SHOULD have played the game. Please turn in a printout of your slides printed 6 PER PAGE. The slides MUST be easily readable at this resolution. Please also email your PowerPoint presentation to glen.schmidt@utah.edu. The assignment is due at the start of class on Friday.

Friday, Sep. 4, Session 5: De-Brief of Game Results; Exam Readings: None. 9:15 – 10:45 in classroom 11:00 – 1:00 p.m. Final Exam. Report due on Littlefield 2. We will hold a debrief on the second Littlefield assignment. Teams will randomly be asked to present their slides (see the assignment for Thursday for details on preparing the slides). Final Exam.

We will have a final exam covering material learned in class.