The week before the club’s visit to Danone, a group of twenty 1st year MBA students participated in a hands-on simulation of a brewer’s supply chain, and I was one of that twenty! In this simulation, we were able to experience the basic coordination issues of a traditional supply chain that lacks collaboration and information sharing between the actors, while strengthening our knowledge on the processes that we later experienced in Danone’s visit.
We were divided into teams that represented each of the players of a typical supply chain (consumers, retailers, wholesalers, distributors, manufacturers and suppliers) and assume their responsibilities in terms of efficiency and service. It quickly became obvious that the lack of communication between the different silos, coupled with the ability to influence while being influenced by others, lead to the Bullwhip Effect, which ultimately lead to shortages and overstocks across the supply chain. Although the simulation was planned to be done online, due to connectivity issues we decided to do it on paper, which turned out to be more dynamic and fun!… Using paper, we were able to really see the bullwhip effect in action: zero inventory vs. piles of inventory accumulated.
We were able to experience first-hand the challenges that supply chains face on a daily basis and understand what can be done differently in order to avoid these “failures.” Thank you all for your active participation and we hope to see you at our upcoming events!