Some strategies for mitigating ordering inefficiencies in supply chains advise sharing information among decision‐makers. However, there has been little consideration of how individual perceptions intervene in the use of available information in decision‐making processes. This article reports the results of an experiment in which participants were instructed to minimize inventory holding and backlog costs for their supply chains as a whole. The analysis suggests that additional information affects supply chain inventory management costs only when rational decision‐making processes are followed. Decreased costs are observed when rational decision‐making is applied with backlog information. In contrast, increased costs are observed when consumer demand information is available.
A web based version of the common “Beer Distribution Game” that facilitates experiential learning was developed and tested for use across the business curriculum. While the fundamental elements of the original paper based game were preserved, the web-based on-line multiplayer version offers refinements to game play, administration and debriefing that allow more focus on the learning experience and open possible applications beyond the traditional one-time demonstration of the bullwhip effect. The web-based supply chain management simulation was tested and refined in Strategic Management courses and Integrated Business Curriculum courses at two widely separated universities. Students responded favorably to the on-line simulation and were very willing to reflect on what they learned about how they made decisions, how worked under conditions of uncertainty, how they treated information and how they worked in the supply chain environment. The simulation can be used to demonstrate systems thinking and various other concepts throughout the business school curriculum including courses in Operations Management, Strategy, Information Systems, and Marketing.
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