The game was held over a week and enabled us to increase our understanding of inventory management at the production stage in the supply chain. In this game, the objective was to accomplish production and delivery of the production within 3 days of lead time. Over the course of the game, we were to monitor the production numbers and make adjustments through the number of machines which we owned. Machines affected the revenues through the purchases and the goal was to obtain as much revenue as possible. Through the game, we learnt how to analyse our production numbers and plot strategies to tackle the demand that was constantly changing.
Strategy
Our strategy was to obtain a stable utilization rate throughout all machines to prevent incurring any late penalty. For example at Day 50, before the game started, we observed that machine 1 was running at 100% utilization for a few days before, and we predicted a bottleneck situation would occur here. Therefore we decided to purchase an additional machine immediately as the game started so as to allow continuous processing of lots to meet the demand and prevent losses in revenue.
After purchasing additional machine 1, we continued observing the utilization of the machine. We were careful not to buy additional machines unnecessarily so that we can earn more revenue from the interest. On day 88, machine 1 hit 100% utilization for 4 consecutive days. However, the average revenue earned was still $1000 despite the high utilization. Therefore we decided not to purchase additional machines at station 1. This proved to our favour as the revenue earned did not drop during this period of time even though station 1 utilization continue to be close to 1. Furthermore, we continued to earn a higher interest than other teams who bought additional machines. Due to this plan, we were amongst the top few teams at this period of time.
At day 120, a situation similar to day 88 began to occur; machine 1 hit 100%