Coordination across functions in organizations

Root Beer Simulation

In this simulation, I played the role of the retailer trying to obtain wholesale products and sell them to consumers. However, because of the size of the orders I was getting, it seems clear that I was more of a distributor; getting wholesale stuff and selling it to large customers, rather being a retailer selling products directly to consumer customers. My understanding is that different students have different aspects of the project, and I would have been interested to be the shipper from the manufacturer and see what that involves. I would also have been interested to see how consumer demand would impact the customer.

Running this simulation and coming into it mid-stream was a very interesting process. I came into the simulation with a backlog that started at week 8. I was worried about over ordering at that point, and that my customer would reduce orders, leaving me with too much product on hand. However, I was also worried that if I did not order enough, the backlog would continuously increase, costing me money. By the time the simulation ended, I still had a slight backlog, but I believe I would have been able to correct that within two more inventory cycles.

This simulation was helpful in teaching about supply and demand. It helped me understand that the operations management process is not really an internal process because it is so dependent upon supply and demand. Trying to anticipate demand is difficult enough, but then being able to anticipate demand without having an adequate supply to meet customer orders is even more complicated because it is impossible to tell if customers are placing orders in an effort to try to cure their own backlog or because that is their actual consumer demand. Therefore, one simply does not know how much product to keep in inventory. Furthermore, I can see how any mistakes on my part would have a similar impact in both the supply and demand segments. This made it clear that I would need to learn flexibility, which might even be a good subject for future training (Saslow, n.d.).

One thing that I found myself wishing I could do was communicate with the customer and the supplier, which, of course, I could do in a real life scenario. In that situation, I could get a much better idea of when I could expect the backlog to clear and why the supplier was unable to meet my order requirements. I could also have used that information to convey to my customer my expectations of when I would be able to fulfill their orders. Having this ability to extract information would be very helpful. "While one strategy may work for a majority of companies, it may not be the best strategy for your organization" (Neal, 2010). It seems impossible to develop strategy without having strong forward and backward communication.