Beer Essentials in Supply Chain Management
Discover the four essential roles in the beer supply chain - retailer, wholesaler, distributor, and producer. Learn how orders and shipments flow between these entities each week, aiming to minimize costs through efficient inventory management. Dive into the Beer Game simulation for hands-on learning.
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Presentation Transcript
supply chain: the beer essentials overview four roles: retailer, wholesaler, distributor, and producer. each week orders are submitted upstream. retailer to wholesaler, wholesaler to distributor, orders take one week between firms each week shipments are delivered downstream. producer to distributor, distributor to wholesaler, ... shipments take either one or two weeks between firms goal is to minimize costs Carry cost: end of each day penalized for each unit held in inventory. Backlog cost: end of each day penalized for each order you could not fulfill beer game www.moblab.com 9A Playground for Decisions 9
your game screen click truck to accept new shipment beer game www.moblab.com 9A Playground for Decisions 9
your game screen click to add shipment to inventory beer game www.moblab.com 9A Playground for Decisions 9
your game screen inventory updates. click to read orders. beer game www.moblab.com 9A Playground for Decisions 9
your game screen orders update. click to fulfill orders out of inventory beer game www.moblab.com 9A Playground for Decisions 9
your game screen use slider to choose how much to order. beer game www.moblab.com 9A Playground for Decisions 9
your game screen place order beer game www.moblab.com 9A Playground for Decisions 9
your game screen click magnifying glass to get important information beer game www.moblab.com 9A Playground for Decisions 9
your game screen orders flow upstream. shipments flow downstream beer game www.moblab.com 9A Playground for Decisions 9
your game screen backlog cost. carry cost beer game www.moblab.com 9A Playground for Decisions 9
your game screen click the magnifying glass to return beer game www.moblab.com 9A Playground for Decisions 9
your game screen click history tab for information on your order ETA beer game www.moblab.com 9A Playground for Decisions 9
payoffs objective=efficiency Goal: minimize cost Balance: If you increase (decrease) inventory you reduce (increase) risk of incurring backlog cost but increase (decrease) carry cost. (Cases Moved x 100 x max{carry,backlog})/Total Cost cases moved payoff = x 100 x max{carry,backlog} Total cost beer game www.moblab.com 9A Playground for Decisions 9
payoffs an example You moved 100 cases You incurred carry costs of $100 and backlog costs of $0 You incurred a total cost of $100 cases moved payoff = x 100 x max{carry,backlog} Total cost beer game www.moblab.com 9A Playground for Decisions 9
happy playing! payoffs an example You moved 100 cases You incurred carry costs of $100 and backlog costs of $0 You incurred a total cost of $100 cases moved payoff = x 100 x max{carry,backlog} Total cost 10,000 100 x 100 x 100 100 beer game www.moblab.com 9A Playground for Decisions 9
