Bullwhip Simulation: Part 2

There are a couple of ways in which one can go about reducing the Bullwhip effect. First and foremost, the manager has to focus on the demand experienced by factories rather than being getting to myopic about the demands from the customers only. As demand from customers is easy to predict, many managers get complacent doing so, which ignores day-to-day fluctuations in favor of running level. Another method would be to reduce or eliminate the delays along the supply chain. It’s easier to say than to accomplish. And I can definitely say that after completing the Bullwhip simulation where it is such a commonplace to fall for either the demand creep from the customers or the inventory creep because of over producing or wrong prediction.

Bullwhip Simulation : Part 1

I completed the Bullwhip simulation and I felt that it really got into my nerves. It was frustrating for me as I was not able to able to return the systems to equilibrium. Though it sounded very simple as an objective to return the systems to equilibrium, once somebody starts playing it, they will soon realize that it is more intense and complex than it initially seemed. I thought the concept behind the simulation was also very complex but the way they have worded it, seemed like they wanted to camouflage that complex idea with simple words. It sounded so simple. Customers are ordering 10 cases of beer and you have 10 cases of inventory each week. In week 2, your customers will increase their orders from 10 cases of beer a week to 15 cases of beer. That was it. I had to make sure that I can control my supply chain in conformance with the customers’ demand. But, I was wrong. It’s not that simple. I applied two strategies. One was to start off with the customers’ order in mind only. I wanted to make sure that the customers are getting what they are asking for. Pretty soon, I ran into an inventory creep, so I had to cut my supply. In a particular moment of time, I got really scanty. But that didn’t save my day as well. Time isn’t static and it beat me in the long run. Then I applied my second strategy. And that is to start in a skeptical manner. Producing and supplying less, which at one point of time, prompted me to produce by zillions. I was getting messages that my customers are thirsty and I had no means to quench their thirst once the demand started to creep in. And lastly, I would like to say that one has to be really, really judicial in his/her decision while completing this simulation to be successful.

BudNet and SCM

The five factors that are driving SCM success are making the sale to the suppliers, weaning employees off traditional business practices, ensuring the SCM system supports the organizational goals, deploying in incremental phases and measuring and communicating success and last but not the least being future oriented. And now we can draw our attention as to how BudNet had its effect on each of these aforementioned five factors. BudNet has included the distributors as well as the sales representatives in its SCM network, thus touching upon the first factor. As the BudNet had good response from Anheuser-Busch's distributors and sales representatives because of its user-friendliness, it has been successful in addressing the second factor as well. The organiaztional goal of Anheuser-Busch has been to be the best in the industry that they are in. And BudNet has surely been able to successfully achieve that with their SCM system which is said to be even better than Coca-Cola. It has been progressing by having digestable bites of its SCM system, thus touching upon the fourth factor and last but not the least, the tendency to be future oriented has surely been met by Anheuser-Busch merely implementing the SCM systems, giving an important signals to its rivals that they are here to stay and excel, not only for the time being but in the days to come as well.

SCM is experiencing explosive growth

SCM is actually experiencing explosive growth. We can prove that statement by using BudNet as an example. It has helped Anheuser-Busch's share of the $74.4 billion U.S. beer market inch up to 50.1 percent from 48.9 percent. It also helps them to constantly change marketing strategies, to design promotions to suit the ethnic makeup of its markets, and as early warning radar that detects where rivals might have an edge. Thus it has become an integral part of every successful company to have an effective and efficient SCM system. In the recent past, this lone factor has been making all the differences betwenn companies as to who has the better edge over the other. Thus, it is no wonder that SCM is experiencing explosive growth.

Supply Chain Management and Anheuser-Busch

An SCM system can help a distributor immensely such as Anheuser-Busch to make its supply chain more effective and efficient. It helps them to understand as to what products are selling, which campaigns are successful and what needs to be done to help the customer's business. It gives Anheuser-Busch get facts and numbers on how much of the sales they did when they had a display in a certain location. Overall, the SCM systems that Anheuser-Busch adopts has helped them to be more effective and efficient than its rivals.

Autonomous Vehicles

Autonomous vehicles could be used by industries in manufacturing plants to transport raw materials or other heavy equipments, suppose from point A to point B, saving the manufacturing plant labor cost. As it could be able to lift heavy loads, that capability would surely add to the efficiency of the organization. And as more raw materials would be turned to finished products more rapidly, the effectiveness of the organization would increase as well.

Use of DARPA Grand Challenge

With a lucrative prize money and a grand event, DoD was able to draw much more attention than it would have through other means. The DARPA Grand Challenge brought together individuals and organizations from industry, the R&D community, government, the armed services and acamedia. Such amalgamation of minds is more likely to produce a better and sophisticated vehicle than a product produced by a pigeonholed mindset.