Information technology is merging with traditional technologies used in manufacturing and supply chain operations. Traditional technologies such as machines that make products in factories, forklift trucks that move products within warehouses, and vehicles that deliver products to customers are all taking on new capabilities as they merge with information technology. Activities involved in moving physical products from one location to another remain the same, but the ways in which these activities can be planned and carried out are changing in a big way.
Imagine there is suddenly a real opportunity to stop the fighting in Syria. After months of tense negotiations and years of carnage, all the parties reach an agreement. But unless this agreement is implemented quickly it will collapse into chaos once again. The diplomats and politicians have reached agreement on strategy, now they need professionals to make it happen. And that means logistics and supply chains to support the movement of 500,000 refugees. Immediately.
SITUATION REPORT: The UN Security Council has approved the Munich Security Conference recommendation previously endorsed by the 17-nation International Syria Support Group. In this UN Security Council resolution, a Chapter VII Peace Enforcement mission is authorized with participant nations committing Peace Keeping (PK) forces as part of the approved Peace Support Operation (PSO). The mission has been assigned the code name “Inherent Rescue”.
Simulations are a great way to learn about and teach about how supply chains work. What used to be so complicated only a small group of experts could understand, is now accessible to anyone wishing to use simulations to analyze supply chain operations and explore different possibilities – SCM Globe.
Simulations show the best way to support a continuous flow of merchandise on the ancient Silk Road was to have large stocks of inventory at key locations. They would act as buffers to absorb the fluctuations in product supply inevitably created by the bullwhip effect. Two such locations are shown in the screenshot below. [This article picks up where the second article “Taming the Bullwhip on the Silk Road” left off]
And this observation raises a big question: Who would have owned and operated the facilities where these huge inventory buffers were located? It required someone with a lot of money to store and protect the inventory, and It required someone who looked to the long term to make money, not just from one year to the next. Let’s see what emerges.
How was it possible in the year 210 A.D. to maintain a continuous flow of merchandise on the Silk Road and to match supply with demand as conditions changed from one year to the next? How could people without telephones or any form of communication faster than the pace of a camel caravan figure out how to operate this vast supply chain without continuously running out of products in one city and building up too much somewhere else? [This article picks up where the first article “Ancient Silk Road – First Global Supply Chain” left off]
Based on simulations of Silk Road operations, and a bit of historical research, an interesting answer emerges. This answer cannot be absolutely verified, yet it fits the available facts and provides a simple and coherent explanation. Let’s start with the simulation results. In the initial simulation the supply chain runs for eight weeks and then silk inventory runs out in Palmyra (4), as shown in the screenshot below.
(click on image for bigger picture) Continue reading
CASE STUDY CONCEPT: Timeless Supply Chain Challenges (inventory, location, transportation, the Bullwhip)
Imagine it is the year 210 A.D. and you are the head of the largest merchant trading house on the Silk Road. The long prosperity of the Pax Romana has created strong demand in the Roman Empire for the luxury products that you import from China and India. Chief among those products is silk. Everybody who is anybody wants their clothes made of silk.
Along the four thousand miles of the Silk Road stretching from the borders of the Roman Empire in the west to the Middle Kingdom (China) in the east, there are many cities and many merchants, yet all know your company and your name — you are the Merchant House of Barmakid in the city of Merv.
“We wargame because we must. There are certain warfare problems that only gaming can illuminate.” – Robert Rubel, Professor Emeritus, Naval Warfare Studies, U.S. Naval War College.
Military organizations have been using games to train their officers and predict possible outcomes of future battles since the Prussian Army began using the game “Kriegsspiel” some 200 years ago (http://en.wikipedia.org/wiki/Kriegsspiel_(wargame)). This shouldn’t be surprising if we accept the notion that games are a biological adaptation in mammals to gain survival skills. In nature, play is the activity of practicing survival skills in low-urgency situations that can then be used in high-urgency, life-and-death situations. This is exactly the way the military uses wargames.
Could we use games to explore different supply chain options, just as the military uses games to explore different strategies? Could a supply chain game show us the best supply chain solutions the same way wargames show the best strategies? If so, what would that supply chain game look like? Continue reading
If first responders in a disaster do not get the supplies and equipment they need when they need them, then they cannot do their jobs. Dr. Dennis Duke from Florida Institute of Technology and Michael Hugos from SCM Globe co-presented a paper at the ITEC Conference in Prague CZ (http://www.itec.co.uk/).on the use of simulations to train disaster response managers to set up and operate effective supply chains.
We built a scenario based on the flooding disasters that happened in central Europe in 2002, 2010 and 2013. SCM Globe was used to design supply chains for responding to this scenario and exploring different options. We applied a three-part framework to describe activities in the disaster management life cycle as shown below.
[This flooding disaster scenario is available as a case study in the SCM Globe library – “Disaster Response Supply Chains – Flooding Scenario“]
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.
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.
You’ve worked in the family business for years and learned the olive oil trade. Your uncle just retired and now you run the show; it’s your time to show what you can do. And to be blunt about it, the family expects you to make money and grow the business – their livelihoods depend on it. Let’s take a look at the operations you manage. (This article picks up where the first article in the series, Supply Chains of the Roman Empire, left off.) Continue reading