Four Reasons to Use Simulations for Supply Chain Learning

There’s an old saying that goes like this, “Amateurs talk strategy, and professionals talk logistics.” Logistics has always been the foundation upon which successful strategies support themselves. Now in our interconnected and globalized world, skills in logistics and supply chain management are more crucial than ever. In this article we’ll discuss four key reasons for using simulations to develop world-class supply chain professionals.

Key Reason 1. There are Two Kinds of Knowledge — We Need Both

There are two ways of knowing things, and they build upon each other. Those two ways are:

  • Tacit knowledge – difficult to articulate; usually defined as “know-how” or “street-smarts”. It can be transmitted through stories, through social interactions in a group, and through personal experience.
  • Explicit knowledge – codified in language and discourse. It is the facts and figures that can be transmitted by books and dialogue.

An example of tacit knowledge can be seen with a child learning how to hit a nail with a hammer for the first time. You can codify the process to hit the nail with the hammer and explain it to the child as explicit knowledge. But the child only develops the actual skill to do it by taking action, and through trial and error, discovering how to hold the hammer and hit the nail properly.shutterstock_164833697“While tacit knowledge can be possessed by itself, explicit knowledge must rely on being tacitly understood and applied. Hence all knowledge is either tacit or rooted in tacit knowledge. A wholly explicit knowledge is unthinkable.” –Michael Polanyi (http://en.wikipedia.org/wiki/Michael_Polanyi)

Simuations can provide a learning platform where students take actions in a simulated world and develop tacit knowledge. This tacit knowledge enhances classroom lectures because we rely on tacit knowledge to understand explicit knowledge. Simulations can make the class content “click” when students see the practical and actual uses for what is being taught in lectures and textbooks.

Key Reason 2. Praxis Makes Perfect

Praxis is a philosophical concept that consists of going through a loop between: Theory (explicit knowledge); Practice (tacit knowledge); and Reflection (internalizing and memorizing what we have learned). There seems to be correlations between the learning process of Praxis and some studies on the cognitive aspects of skill acquisition.

For example, studies on skill acquisition in chess players show that only the individuals who spend a significant amount of time reading chess books ever reach the level of Grandmaster (http://psych.utoronto.ca/users/reingold/publications/PDFs/Charness.Tuffiash.Krampe.Krampe.Vasyukova.2005.pdf). Players who don’t read soon plateau, never to advance in their ranking regardless of hours spent practicing. Only the players who spend time reading see their ranking grow (sometimes exponentially) with every passing year.

Books and Chess4

In the same manner, supply chain simulations can complement readings from any supply chain or logistics textbook by illustrating the concepts and principles in the text (the explicit knowledge). Through building and operating simulated supply chains (like playing a game of chess), students learn by applying what they learn from textbooks and lectures to solve problems in realistic simulations (thus turning explicit knowledge into tacit knowledge).

Just as simulators are used to train pilots and build confidence in their ability to respond to unusual circumstances, they can also be used to train and build competency in supply chain managers. What type of simulator can accomplish this? Not closed “black box” simulators into which numbers are entered and a result is returned. That kind of simulation provides little in the way of data or transparency to help students see the connection between their actions and the outcomes that result. What is needed are simulations that let students manipulate all elements in the simulations, and then see how their actions create the results that follow. That level of transparency is critical to drawing students into the intense level of engagement which is needed to turn explicit knowledge into tacit knowledge.

Key Reason 3. Deliberate Practice is Key to Skill Development

“Deliberate practice” is a concept developed by Anders Ericsson (http://projects.ict.usc.edu/itw/gel/EricssonDeliberatePracticePR93.pdf). It is considered to be key to developing expertise in any area. Deliberate practice is a planned activity designed to be mentally challenging, and to improve performance. It uses continuous feedback to point out mistakes the student is making. And the student then immediately takes action to correct those mistakes and try again. Deliberate practice pushes students to concentrate deeply in order to significantly increase their skill levels.

Deliberate practice improves performance through neurological changes in the brain. When you perform an activity there’s a neurological network in charge of carrying out that task (grey matter). When immediate feedback is available showing mistakes, it fires up this particular neurological network. When your performance is corrected and immediately repeated, it builds a fatty sheath around this network called myelin (white matter). Myelin speeds up the communication between neurons which improves performance as you learn new skills (http://thetalentcode.com/myelin/).

The key to deliberate practice is this: you take action, you get immediate feedback on mistakes, you analyze the situation, and immediately repeat the activity while correcting your mistakes. Simulators can become platforms allowing us to deliberately practice career specific skills. Students can design supply chains and run them in simulations. Right away they get feedback on performance, and make corrections and improvements to their supply chain designs, and run the simulations again.

Work with case studies

Simulations identify points of failure in supply chain designs. They stop and show students exactly where the failures are. And they provide a context for students to understand what went wrong. Then students make corrections and try again. They are drawn into a process of concentrating, analyzing feedback, and repeating the process after making corrections to their supply chain designs (this is deliberate practice).

Key Reason 4. Using a Supply Chain Abacus

It is said that the tools we use rewire our brains. There are several studies indicating that individuals who learn math through the abacus or slide rule have a cognitive advantage over those who didn’t use these tools (http://news.stanford.edu/news/2011/august/abacus-mental-math-080311.html). There are two theories as to why this is. The first is that abacus users develop mathematical skills in areas of the brain in charge of motor skills instead of language, which allows them to process mathematical problems much faster. The second theory is that by using the abacus, we’re able to see every single step it takes to solve a mathematical problem, and that allows subconscious areas of our brain to visually identify mathematical patterns and employ them to increase our math performance levels.

It is the second theory, seeing every step, that is applicable to the way simulations can be used in teaching and learning about supply chains. Using the abacus analogy, we could say there are four types of beads on a supply chain abacus as shown in the picture below. Those four types of beads are: products; facilities; vehicles; and routes. When students create their supply chain model by entering the modeling data themselves for these four beads (or supply chain entities), it causes them to think about how the different entities interact, and how that interaction affects the performance of the entire supply chain system they are creating. A supply chain abacus shows students how to move and manipulate the entities so as to improve performance levels of the whole supply chain.

Four Beads on Supply Chain Abacus

Effective simulations also link operating performance in a supply chain with economic performance so students see how to combine different supply chain entities to get both good performance and good economic results. Virtual economies in many video games combine performance with economic results, but they often work like simple calculators and don’t let players directly manipulate each entity (because that would not make for good entertainment). So many video game simulations are good for entertainment, but not so good for learning.

An effective supply chain simulation for learning should be like a logical abacus. It should enable students to directly manipulate the different entities of the supply chains they design, and in doing so, enable a deep understanding of the operational and economic inter-relationships between these entities. When students are exposed to each supply chain entity, and see how different combinations of these entities produce different results, then they develop the same sense of visual patterns that people develop while doing mathematical calculations on an abacus.

Conclusion

We need to go through the Praxis loop to take our skills to the next level. A virtual simulator allows us to stop, take time to reflect on our decisions and experiment with new combinations (which can rarely be done in the real world). People need to try out new skills and get immediate feedback on mistakes they make. And then try again, and again, until new skills become integrated into the way they think and act.

Simulations can provide people with realistic and safe-to-fail environments where they use a process of deliberate practice to develop new problem solving skills. The same skills people develop in simulated environments can then be applied in the real world. The degree of difficulty and skill levels required in simulations should be adjustable to fit the needs of a wide range of students from beginners to experienced professionals looking to take their skills to the next level.

Co-authored by Michael Hugos – co-founder of SCM Globe, and Eugene Sheely – instructional designer located in Provo, Utah USA

[SCM Globe is an online supply chain simulator – it is a “supply chain abacus” for designing supply chains and seeing how they work. It draws students into a process of deliberate practice to increase their understanding and strengthen their problem-solving skills in supply chain management.]

Update: Thank you to all who voted for us in the MODSIM World entrepreneurship contest (http://www.modsimworld.org). At the conference, in two rounds of presentations, the judges selected us as the winner. They liked our “cool factor” and innovative use of simulations to engage students in supply chain learning. See more here – SCM Globe Wins Entrepreneurship Contest at MODSIM World 2015.

 

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