1. The Supply Chain Simulation Game
2012 Utah Operations Winter Conference
The Supply Chain Simulation Game
Gal Raz
Darden School of Business, University of Virginia

2. Supply Chain Management Elective
Jan 18 (Wed)
Jan 26 (Thu)
Feb 1 (Wed)
Introduction to Supply Chain Management
Supply Chain Network Design
(K&S)
Data Rich Management
(SEJ)
Feb 2 (Thu)
Feb 8 (Thu)
Feb 15 (Wed)
Feb 16 (Thu)
Feb 22 (Wed)
Sourcing from an Ops / People Perspective (K&S China (B))
No Class
Aligning Incentives in Supply Chains
(Blockbuster)
The Negotiations Exercise (Uncle Coco Magic shop)
The Supply Chain Game – Part 1
Feb 23 (Thu)
Feb 24 (Fri)
Mar 1 (Wed)
Mar 8 (Wed)
Mar 9 (Thu)
The Supply Chain Game – Part 2
The Supply Chain Game – Debrief
Recycling and Reverse Logistics
(Sandvik)
Green Product-Service Systems (Netafim)
Green Product-Service Systems (Better Place)
Jan 19 (Thu)
Jan 25 (Wed)
Outsourcing and Offshoring (Timbak2)
Sourcing from an Ops / People Perspective (K&S China (A))
* The Negotiation Exercise on Thursday February 16th and the Supply Chain Game on Wednesday and Thursday February 22-23
will be from 2:45pm to 4:45pm and thus there will be no class on February 8

3. The SC Simulation Game Main Learnings
Managing a global supply chain that competes by making timely decisions of pricing, ordering, and logistics that impact both the market and competitors
The impact of supply chain contracts on supply chain and individual firm performance
Negotiation under asymmetric information
Supply chain strategy (responsiveness versus efficiency)

4. The SC Simulation Game Procedure
The game is played with competing teams of 4–8 players
Each team has four roles: a Retailer, Wholesaler, Distributor, and Manufacturer
The game is played for up to 96 weeks (2 simulated years)

5. The flow of product and orders
Manufacturer
Retailer
Customers
Wholesaler
Distributor
Manufacturing and transport takes 1 or 2 weeks.
Orders are received immediately

6. The Decisions Weekly: Quarterly: Half Yearly: Order quantity
Mode of transportation (trucks vs planes)
Quarterly:
Retail Price
Half Yearly:
Supply Chain Contract Negotiations (Revenue Sharing or Wholesale Pricing Contracts)
Information System

7. The SC Game Interface
Retailer Screen

8. The SC Game Interface
Distributor Screen

9. Contract Screen (RS Contract)1 2

10. Quarterly Reports

11. The SC Game Debrief Market Strategy – Pricing and market share
Supply Chain Strategy – Ordering, using fast mode of transportation (Responsiveness vs efficiency), coordinated ordering
The Supply Chain Contract
Wholesale pricing contract
Revenue sharing contract
Use of Information Sharing
Individual vs Supply Chain Profit

12. Market Strategy

13. Supply Chain Strategy
Team Team 3

14. The Supply Chain Contract
Revenue-Sharing contract versus Wholesale-Pricing contract
What is the goal and impact of the revenue sharing contract? What is the optimal revenue sharing contract?
What is the impact of the Asymmetric Information?

15. Administrator Interface