I.Introduction The SCM Globe system is a learning tool whose purpose is to provide hands on education in the basic dynamics of supply chain management. During the course of the semester, while using the SCM Globe simulation and performing the activities related to the case study presented, students were afforded the opportunity to manage and operate different supply chains. Students got a firsthand feel of how supply chains operate.
A.Overview of Cincinnati Seasonings Supply Chain
The Cincinnati Seasonings Supply Chain case study is a basic simulation of a simple supply chain to support a company that designs and markets food seasonings and sells its products in stores throughout the Midwestern United States. The purpose of the case study is to familiarize students with how to set up a supply chain and simulate its operations. Students get practice defining the product that the supply chain handles and in setting up the facilities, vehicles and routes that make up the supply chain.
When students simulate the operation of the supply chain that is created they will get an appreciation of some of the central challenges involved in operating a supply chain. Students will get insights into balancing the need to run a responsive supply chain that never lets its customers run out of product with the need to run an efficient supply chain that also minimizes supply chain inventory and operating cost.
Cincinnati Seasonings is located in Cincinnati, Ohio. The founder of the company was born and raised in Cincinnati and learned about seasonings because the family operated a chain of restaurants in the city that served up Cincinnati-style Chilli. This dish is Cincinnati’s offering to world cuisine and it uses a certain fine mix of seasonings to give it the flavor it is famous for.
The company has done well. You have been hired to head up the company’s supply chain operations. They have a seasonings factory and a distribution center in Cincinnati and they are delivering product to stores in Ohio and the surrounding states who sell their seasonings. The company is looking to you to set up and operate a supply chain that keeps customers supplied with product and also runs as efficiently as possible so as to keep costs down. B. The initial supply chain scenario
The initial scenario was that the seasonings factory and the company distribution center contained a route connecting these two facilities. The objective was to create a supply chain to support the Cincinnati Seasonings business. This was to be done by either creating or deleting product, adding trucks, routes and/or facilities and maneuvering the chain supply so that it ran on average upwards of twenty days or more consecutively.
The objective of the simulation is for students to run their supply chain design to determine how inventory moves through the different facilities. Students are able to see where too much inventory builds up and where they would run out of storage capacity. Students are also able to see where there aren’t enough inventories. Students are able to click on the tabs for the different facilities and vehicles to see the data and graphs of the data. Students are to look for patterns and figure out what needs to be done to fix the problem that stopped the supply chain in that simulation. Students are able to make those modifications to the supply chain facilities, vehicles and routes and run the simulation again. The ultimate objective is to attempt to get the supply chain to run for at least 20 days before it crashes.
Managers are faced with the daunting tasks of getting the products to locations, planning truck routes and just overseeing day-to-day operations. A breakdown in the operation causes shortages or no product inventory therefore no profit is made, but the associated costs will still keep coming creating company loss, plant and store closures etc.
A. What went well
I was able to integrate the new truck into the schedule and move product inventory around so that the stores ran out of product inventory less frequently and the cost associated with a store running out of inventory decreased to the fact of it happening less. By modifying the transportation route, the trucks were able to get the product inventory to intended destinations somewhat faster which was another factor in the stores stabilizing product inventory on location. Because the product was leaving the warehouse and getting to stores quicker, I was able to reduce the storage space which was an initial problem so the increase of costs because of it decreased. The stores showed a moderate increase in profit. The actions I took in attempts to reduce or better yet, eliminate the issue of overabundant product inventory, included making my shipments larger so that stores where there was low inventory product could retain a normal or slightly more of the product to reduce risk of shortage. Due to making my shipments larger I added an additional truck to assist in getting the product inventory from the warehouse to the stores.
B. How could you have improved
Movement along the route was one of the many ways in which I could have improved in using the simulation. I feel that if I could have transported more product inventory along the route and between the warehouses and stores, I could have created a way to lower fuel cost more without increasing storage costs.
Finding ways to shorten routes and delivery times between stores would also been a benefit for the company. When I would attempt to fix one problem, it eventually led to the creation of another problem and initially led to additional costs until I stabilized the main problem.
Having too much product inventory with not enough storage space at the warehouse led to more of the product being farther away from the stores needing the product at storage warehouses farther away along on the route. Connecting to the issue of too much product inventory and not enough storage space was transporting the excess product inventory to other locations on the route while keeping the costs from cutting into the profits and creating a loss that could eventually lead to a store, production plant or warehouse closing.
Another issue I had was with having enough storage space to contain the over flow of product, determining where, how much additional storage space was needed and the costs associated with obtaining the space became additional problems that required immediate attention.
I learned that in attempting to fix one problem led to the creation of another problem and initially led to additional costs until I stabilized the main problem. Upon discovery that I did not have enough storage space to contain the over flow of product, determining where, how much additional storage space was needed and the costs associated with obtaining the space became additional problems that required immediate attention.
Is it better to expand the existing factory to support demand from the new stores or better to keep existing factory as is and build a new factory closer to the new stores? Based upon my findings, I feel that it would be more beneficial to the company to build a new factory closer to the new stores rather than to expand the existing factory. Building the new factory along the route between the new stores could possibly work to reduce delivery time, cut down on fuel costs as well as a decrease in the amount of trucks used to transport between the stores based on the factory location. Even though there are initial costs to building a new factory, it may still pan out to be less than conducting upgrades to the existing factory which is farther away from the new stores. Those initial start up costs with building the new eventually subside to lesser costs in upkeep, repairs etc.
By building the new factory closer to the new stores, delivery of the goods may occur with less time which would mean the product reaches the store shelves faster and may produce an increase in product sales. Transportation advantages are a plus for building the new factory closer to the new stores. Less fuel would be needed along the route due to close proximity of the new factory to the newer stores. There would also be fewer trucks to be maintained and drivers as well. The funds allocated for these expenditures could be shifted towards lowering other costs. Storage costs may also be lowered as product goes to the stores faster upon manufacturing.
A. If you were to do the simulation series over, what would you have done differently? Because the object of the simulation was to design and manage a chain supply so that students could observe how inventory moves through the different facilities. Students were able to see where too much inventory built up and when they would run out of storage capacity. Students also got to see where there wasn’t enough inventory.
If I could go back and redo the simulation series over, I believe I would take better care to maneuver product around the warehouse into the stores before there would be a shortage in a store. A key factor to ensuring that product inventory was at locations on time was transportation. I would also make more adjustments to keep my operating costs as low as possible. B. Recommendation: How could this learning experience be improved?
This was an extremely good learning tool overall. With that being said, some of the problems that I encountered very early on had to do with getting started. I found my first attempts to install, log on and use the program extremely difficult. I made three or four attempts when the instructions were put out. I used the email address as instructed but it never would work. It was only after being informed there were known performance issues when running under Microsoft Internet Explorer 9 and the simulation would pause and a message would display about a long-playing script that the class was told to use the Google Chrome browser and that it could be downloaded for free and it installed quickly and co-existed well with Microsoft IE9 browser.
Information indicated that the SCM Globe ran much faster under Chrome. It was only after I downloaded Google Chrome, that the program worked well and I was able to get started on using and managing the program and actually work on the simulation. As far as using the SCM Globe Simulator once getting the software to work for me was not the greatest meaning at times it worked well and at other times not so well. Once I did get through some of the technical issues I had to go back and start the process all over again. Sometimes the program would freeze up during the simulation and would start me back at the beginning. I was able to get the results of 22 days straight which is a great improvement from the 9 day, 15 day to 20 day streak.
A plus were the four training videos to help familiarize students with SCM Globe. The training videos got right to the point of describing the things needed to know to work the program. The User Manual was also a short guide and used screenshots and bullet point notes to tell aid students in what was needed to know to assist in the simulation program and was also helpful. Even though there were no right or wrong way to manage the simulation, I wished there was more definite way for me to determine if what I was doing was more right than wrong.
Overall, the SCM Globe was a great learning experience. It gave me a more defined feel to what managers go through in daily operations and what could happen if major changes occurred to daily operations.