MIE363H1: Operations and Supply Chain Management
Operations and Supply Chain Management
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MIE363H1: Operations and Supply Chain Management
Project 2: Supply Chains
Project Specifications
Introduction
For this project, you will be playing a game simulating a supply chain. You and your teammates
will act as different parts of the supply chain and experience it in this Excel-styled ecosystem.
Once your team has played the game, conduct a team debrief and write a 4-to-8-page report
responding to the questions outlined in the debrief. Instructions for how to play the game and
questions to answer for the debrief report can be found in this document.
The goal of this project is for students to understand the application of supply chain management
through a simulation exercise, and further their communication and professionalism skills through
report writing.
Note: Your final mark for this project is NOT affected by the numbers determined during gameplay;
rather, we are interested in knowing how and why you made decisions throughout the game.
Group Formation
Projects will be done in groups of up to 3 members. You are free to change groups by joining a
different group on Quercus. Remember that you must be enrolled in a group on Quercus prior to
submitting the project, otherwise a penalty will apply.
Problem Context
Consider a distribution supply chain for a product consisting of three companies: Retailer A,
Retailer B, and a common Supplier. The figure below illustrates the supply chain graphically:
Retailers A and B have different target customer market; this means that you can assume their
demands are independent of each other. However, they do sell the same product, and the Supplier
is the only company that makes this product, so it is not possible to procure the product through
other means.
Although the Supplier would like to meet all the demand for the product, it is constrained by its
own suppliers, and therefore the quantity of products that they can provide to both Retailers might
not be enough to satisfy the requested quantities.
On each day, each Retailer will see the amount of demand for the product for that day and will
then submit an order request to the Supplier stating the number of units they would like. This order
Supplier
Retailer A
Retailer B
Customer A
Demand
Customer B
Demand
request takes one day to reach the Supplier; for example, if the order request was made by Retailer
A on Day 2, the Supplier will only see this order on Day 3.
On each day, the Supplier will see the orders from both Retailer A and Retailer B from the day
before, as well as amount of the product they have available. The Supplier will then decide how
much of the product to allocate to each retailer. The allocated products will then take one day to
reach the Retailer; for example, if the Supplier made allocation decisions on Day 3 (which means
they will have seen the Day 2 orders), the retailers will only receive these products on Day 4.
For both Retailers, backlogging is allowed for this product; however, each unit of unmet demand
will incur a cost of $3 every day that it is not met. On the other hand, a cost of $1 is incurred for
each unit of the product in inventory at the end of each day. Your job is to minimize the cost
incurred to your own company.
For the Supplier, you can only allocate the units within your on-hand inventory (which cannot be
negative). Your job is to allocate units as closely to the requested amount as possible, with any
shortfall incurring a cost of $3 per unit per day and any excess inventory incurring a cost of $1 per
unit per day. Note that the fill rate is defined as the number of units actually allocated to a retailer,
divided by the number of units requested by that retailer.
Setting Up the Game
This activity is designed for 3 players. Start by designating a role to each person of your team:
• Player 1: Retailer A
• Player 2: Retailer B
• Player 3: Supplier
If your group has 1 or 2 members, find a friend or two to join you for the gameplay portion of this
project. They don’t have to have taken MIE363.
Each group needs to download 1 copy of the Excel file: this file needs to be saved to a common
folder that each player has access to and can simultaneously edit (e.g., Google Drive, Microsoft
OneDrive).
Each player will then open the Excel file on a computer – each player should be playing from a
different computer. Each player should go to the Excel sheet that is indicative of their role:
• Player 1 will go to sheet “Retailer A”
• Player 2 will go to sheet “Retailer B”
• Player 3 will go to sheet “Supplier”
Note: at no point during the game will you need to go to any other player’s sheet.
Once all players are on their own computer and on the Excel sheet corresponding to their role,
each player should write replace the “FALSE” with “TRUE” in the orange-colored cell B2 of their
sheet. When all three players have done so, the game will begin.
How to Play
This is a turn-based game with 60 rounds (“days”) in the game.
At the start of Day 1, players are to perform the following activities in order:
Step 1: Retailer A and Retailer B will enter in their Day 1 order in cell D7 of their respective sheets.
These orders will be revealed to the Supplier on Day 2.
Step 2: The Supplier will see the requested quantities of the product from the day before. The
Supplier will now make decide how many units of the product each will receive Retailer by filling
in the orange-coloured cells for that day (cells G7 and H7). The total allocation across both
Retailers cannot exceed the amount of available on-hand inventory (cell F7).
Step 3: Retailer A and Retailer B will receive the products allocated by the Supplier from the day
before (on Day 1, they will receive allocations made in Day 0).
Once Step 3 is completed, the round ends and the next day begins.
From Day 1 to Day 30 inclusive, do not discuss metrics and/or strategies with the other players.
This is to simulate the limits of information sharing in the supply chain. From Day 31 onwards,
you will be given access to additional information that may help your decision making, and you
can then speak to the other players.
Note: Each action has a 1-day lead time due to the time required to process each order. This is
why on Day the Supplier sees the requests of Day ( − 1) from the Retailers and the Retailers
receive product for Day on Day ( + 1).
The game ends when all players have reached Day 60.
Debrief
Once the game has been played, answer and submit a response to the questions below:
Reflection on the game
Note: Your mark is not affected by the numbers in the game; rather, we are interested in knowing
how you made the decisions you made.
1. What was your decision-making process in coming up with your requests/allocations in the
first 30 days? How did your strategies perform?
2. Did the additional information and ability to discuss strategies starting from Day 31 your
decision-making process? Were there any noticeable differences between Days 1-30 and Days
31-60 as a result of the extra information sharing?
3. Is there additional information (other than what was provided in the Excel file) that might have
helped you in making better decisions? What are they and how would they help? Are there
challenges to accessing this information, and if so, what are these challenges?
Relevance to Reality
4. The Bullwhip Effect can often be seen in supply chains. Was the Bullwhip Effect apparent in
your group's results? Why do you think it did or did not appear?
5. In this activity, we made no distinction between the two retailers or the customers that they
serve. However, it is quite possible that the two retailers serve very different customers.
Imagine that one retailer served predominantly affluent customers while the other served
customers more likely to experience poverty. If you were the Supplier, does knowing this
information change your distribution strategy? Why or why not?
Deliverable
Submit the answers to the above questions as a single PDF file on Quercus (do NOT submit the
gameplay Excel file), with the following formatting requirements:
• 12pt font, Times New Roman or Arial
• 1-inch margins, double spaced
• Cover page with names and student numbers of all team members
• Report body with maximum of 6 pages
• Figures and tables (if any) must be captioned and referred to in the body of your report
• No appendices or additional files are allowed (do not submit your Excel file)
• If references are used, include a reference list with appropriately cited references and
written in accordance with an established standard (e.g., IEEE)
• Number all responses in your report to match the question being answered. You do not
need to re-write the questions in the report.
Be sure to back up as many claims as you can with evidence/metrics from the activity data, or with
research from external sources.
Mark Breakdown
• Question 1: 15 marks
• Question 2: 15 marks
• Question 3: 20 marks
• Question 4: 15 marks
• Question 5: 25 marks
• Formatting (writing quality and adherence to submission requirements): 10 marks
For a total of 100 marks.