FALL 2006
VOL. 8 NO. 1

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Special Feature

Teams Play Supply Chain Game in First Global Competition ►

Logistics used to be considered ‘back-of-the-house’ activity; it was thought of in terms of minimizing costs and ensuring that there weren’t too many screw-ups. In today’s global, digital, intricately interconnected economy, logistics is now a strategic issue that can provide powerful competitive advantage to companies, or hold them back in equal measure. Wal-Mart and Dell have captured the top spots in their markets in part because of the innovations introduced into their supply chains.

The just-in-time economy depends on the quick and reliable delivery of goods and services, and a breakdown anywhere along the line can throw a serious spanner in the wheels—as Toyota found out in 1997, when a fire in an Asian brake factory shut down the company’s car assembly plants around the world for several days.

Meeting the supply chain challenge has become a more complicated and critical endeavor than ever before. The Smith School is at the forefront of this field, with a strong academic program that is producing the managers, scholars and innovators of tomorrow.

Supply Chain Management at Smith
The Smith School’s Logistics, Transportation and Supply Chain Management (LTSCM) program is robust and exciting, but like the field of logistics, it is doesn’t always get the recognition it deserves.

Smith’s LTSCM undergraduate program is one of the largest in the country, second only to Penn State. Coursework focuses on globalization and information management tools that integrate procurement, operations and logistics, from raw material suppliers to the final customer. Students have the chance to use computer models and programs which will be key to their later careers, and to work in the school’s Supply Chain Management Center, a leading producer of practical, relevant research in this area.

Starting in 2008, students will also have the option to pursue special co-curricular events and study opportunities through a Supply Chain Management Fellows track as part of the Smith Undergraduate Fellows program. SCM Fellows may take one additional specialized course, but most of their extra time will be spent doing internships and attending trade shows on Fridays throughout their junior and senior years.

The school’s academic program has produced winners of national supply chain management scholarships two years running—Anna Kroupnik in 2005 and Jonathon Ulrich in 2006—showing the excellent preparation students receive in the program.

There are only 18 programs in the country offering LTSCM courses at both the undergraduate and graduate level, and Smith has one of the most comprehensive and far-reaching course offerings available. Students can pursue an MBA with a concentration in LTSCM or a PhD in LTSCM, which gives students more depth and a greater strategic understanding of the models and programs they use as undergraduates.

Starting in 2007, Smith will also offer an Executive MS in Supply Chain Management, aimed at practitioners looking to update and upgrade their skills. “The MS in SCM will give corporations the opportunity to develop the skills of their high-end employees,” says Bill DeWitt, Professor of the Practice of Supply Chain Management at the Smith School and the program’s most ardent advocate. “It will permit them to do more strategic work with modeling. They already know how to use SAP or Oracle, but this will help them understand how to make the most effective use of it.”

Student Involvement LTSCM students are some of the most involved in the Smith School community. The LTSCM Society is an undergraduate student-run organization which promotes careers in LTSCM, sponsoring weekly talks by industry leaders. Graduate students participate in the Graduate Supply Chain Club. The two organizations work together to sponsor an annual Industry Day, a large employment fair and networking event for those in the industry. Last year, 80 recruiters from more than 30 companies attended the event. These events create important networks of connections for students moving on to the marketplace after graduation.

And when they’re ready to move on, Smith LTSCM alumni are sought-after employees. Most LTSCM majors double major in another academic area as well—finance, marketing and information systems are the most common. This gives students both managerial depth and a breadth of focus that recruiters just love.

The Smith School isn’t just teaching cutting-edge material; we’re teaching it in cutting-edge ways. The globalization of supply chains has created new challenges for companies: longer transportation times, big inventories, complex logistics and the high cost of coordinating information, goods and money across the globe. A new Web-based management game at the Smith School is the first of a series developed to address supply chain challenges such as globalization, the increasing importance of the customer role and mass customization.

Thomas Corsi, Michelle E. Smith Professor of Logistics, and Sandor Boyson, research professor, who are co-directors of the Smith School Supply Chain Management Center, developed the Distributor Game, a management game designed to help students engage with supply chain challenges related to globalization, giving students a feel for the 24/7 global environment of the supply chain world.

But this isn’t just a game. It’s a powerful new teaching tool that is transforming the way students think about logistics. Computer models are an important tool for supply chain managers, and the Distributor Game was a natural outgrowth of that tool. “Gaming and modeling are two sides of the same coin,” says Bill DeWitt, “but gaming is more interactive and fun.”

Students playing the game log in to a Web portal that contains the instruction, content and background information for the game. The scenario focuses on a demand surge for laptop computers in Asia and a diminishing demand for desktop computers. Suppliers in the Asian region were modeled in such a way that they could not meet the increased demand of distributors, causing shift in demand from Asian distributors to suppliers in the U.S.

Players have to manage a variety of operational-level decision-making processes to keep their distributors in an economically healthy state. Players deal with quotes, orders, confirmations, and bills. Shipments and payments are handled by computational algorithms that support the human players. The game’s architecture supports splitting the decision-making process between multiple players on a team, so that one player focuses on inventory and one on sales, for example.

To better reflect the pace of the real-time global supply chain, the simulator allows for continuous play by looping over an event list while taking pre-defined steps in between. The controls allow the game operators to slow down or speed up a game, helping to emphasize and control the attention and focus of the players. A game may last several weeks or even over the course of a semester, where players can make decisions to manage companies at different times and from different locations. Continuous time advance, rather than turn-based play, allows players to interact with the game over a long period of time.

This fall teams from a number of business schools worldwide will go head-to-head, playing the Distributor Game against one another over the Internet. The competition is being sponsored by Sun Microsystems, which has supplied funding, equipment and technical assistance.

The Distributor Game was jointly developed by the Smith School’s Supply Chain Management Center and the Delft University of Technology, Delft, The Netherlands.

The Smith School’s Supply Chain Management Center, led by co-directors Sandor Boyson, research professor, and Thomas M. Corsi, Michelle E. Smith Professor of Logistics, was established in 1998 to advance supply chain practices and research.

The center developed a prototype supply chain portal through which all the functions of a supply chain—demand forecasting, collaborative planning, inventory optimizations, warehouse management, transportation planning, and customer service, among others—are conducted. The portal helps teach all aspects of management of a real-time supply chain, and uses some high-tech tools to do so, including RFID (radio frequency identification) technology.

In addition to its research projects, the center also offers consulting to major U.S. and international corporations. “We’ve conducted graduate field projects with U.S. Maritime Administration, BAE and Censeo and worked with Black and Decker on a Undergraduate Total Quality project in Logistics,” says Corsi, describing some of the Center’s recent work. “We have also sponsored MBA consulting projects with Lockheed Martin.”