Simulation

Global Supply Chain
Management Simulation
Debrief Slides

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Learning and and
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Harvard
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School (revised Dec 2010)

1

Board Members’ Objectives
Member

Objective

Betty

Forecasting: choice of options (consensus vs. mean) Doug

Forecasting: choice of options (role of risk)

Yvonne

Stocking Levels: Weighing the costs of over/understocking Meryl

Production flexibility: accurate response/ sourcing strategy (focus on flexibility)

Paul

Production flexibility: accurate response/ sourcing strategy (focus on demand uncertainty)
2

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Enspire
Enspire
Learning
Learning and and
Harvard
Harvard
Business
Business
School
School (revised Dec 2010)

2

1. Betty?

3
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Learning
Learning
and and Harvard
Harvard
Business
Business
School
School (revised Dec 2010)

3

1. Betty: Forecasting Room Choices
• Consensus forecasts can be problematic: – Can be skewed by interpersonal dynamics: e.g. person with power or
“squeaky” wheel can dominate
– Can lose valuable information about variance in opinions
• Betty believes that using the mean of the forecasters for your point estimate is a better choice than the consensus.
• Betty withholds her vote if you choose an option that has:
– Consensus forecast ,
– Mean forecast , and
– No change in profitability
©©
Enspire
Enspire
Learning
Learning
and and Harvard
Harvard
Business
Business
School
School (revised Dec 2010)

4
4

The Details: Betty’s Criteria
Betty withholds her vote if you choose a
High Consensus/Low Mean option.
There were 6 such options (Model A):

5
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Enspire
Enspire
Learning
Learning
and and Harvard
Harvard
Business
Business
School
School (revised Dec 2010)

5

2. Doug?

6
©©
Enspire
Enspire
Learning
Learning
and and Harvard
Harvard
Business
Business
School
School (revised Dec 2010)

6

2. Doug: Forecasting Room Choices
• It is critical to consider forecast variance when making product design decisions and production planning decisions.
• High