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Assignment: 1. What is your evaluation of ChemBright's strategy? How sound is the business at
this point? What changes could Steve Vitale make to improve company profitability?
3. If this threat is surmounted, what avenues of expansion appear most promising for
ChemBright?
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Module: Supply Chain Fundamentals: Matching Supply with Demand
Section: 00
Date: January 17, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic:
Materials: Excerpts from Chapters 4 and 5 from Production and Operations Analysis by
Steven Nahmias.
Inventory Slides
Assignment: The reading for this class is fairly technical and not representative of the rest of the
course. Do not worry if some portions are difficult to follow, especially the
derivations for the formulas. However, an understanding of the economics of
inventory is vital to be an effective supply chain manager.
4. How would you evaluate the various alternatives available to Brent Cartier to
address the inventory and service problems? (If needed, use z = 2.05 to calculate a
safety stock level for a 98% service level.)
Assignment: 1. What is the value proposition offered by AESCO and ESCI? Identify the value
added by each firm to the channel. Think about why OEMs might buy product from a
distributor instead of buying directly from the manufacturer.
2. What do AESCO and ESCI have to do well to grow? What does the
owner/president of each firm need to do well for his firm to be successful?
3. How might industry trends towards consolidation, globalization, and the Internet
affect each of these distributors?
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Module: Supply Chain Fundamentals: Matching Supply with Demand
Section: 00
Date: January 30, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic:
2. How should Obermeyer management think (both short-term and long-term) about
sourcing in Hong Kong versus China?
3. Based on Exhibit 10 in the case, how should Wally plan production in November?
Make sure to identify factors that would affect the timing and quantity of production
decisions.
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Module: Supply Chain Fundamentals: Matching Supply with Demand
Section: 00
Date: February 6, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic: Global Supply Chain Management Simulation
Assignment: The Global Supply Chain Management Simulation will allow you to manage the
supply chain of a cell phone manufacturer. You will be put in charge of the
introduction of two cell phone models, and will be required to design the product line,
forecast demand, choose a set of suppliers with different cost and lead-time
characteristics, and allocate production among your chosen suppliers.
After completing the product and supply chain design phase, you will observe actual
monthly demand, and will have opportunities to respond to unexpected events. The
simulation is repeated over a four-year period, allowing you an opportunity to revisit
your decision processes each year after learning from the feedback you receive about
the previous year's results.
At the end of each year, the company's virtual board of directors will evaluate your
performance. In addition, profits for each year are computed. Team performance will
be revealed in class on Thursday, February 6.
Availability of Simulation
The GSCM Simulation will be available for you to play any time between 11:30 am
on January 30, 2003 and 8 pm on February 5, 2003. To run the simulation for class,
you have been assigned to a two-person team, which we have found greatly facilitates
learning. On Friday, January 24, you will receive an email from Maggie Davis that
will specify your teammate, your team's log in ID, and your team's password. You and
your teammate should find a time and location when you can take between 2 and 3
hours to run the simulation. You can run the simulation in the Shad R&T Lab, in
Spangler, or from your home. Although the application works over a 56K modem, it
is faster using a high-speed connection. It is also better to have the ability to listen to
audio.
Important:
3. When you and your teammate run the simulation, you must run
through the entire 4-year period and submit those results without
restarting the simulation. This set of team results will be tabulated and
shown in class. You must complete all four years in order to have your data
recorded. You are done with the simulation after you have answered all of the
feedback questions at the end of year 4.
4. As you and your teammate run the simulation, please input the
decisions you make and the rationale behind those decisions on the word
document "GSCM Sim.Record Sheet," posted on the course platform. After
completing the GSCMS record sheet, please save the record sheet as a
Microsoft Word document with the name TeamXSim (using your unique team
number in place of the letter X) and email to araman@hbs.edu and
madavis@hbs.edu by 8 pm on February 5, 2003. Make sure to also bring a
copy to the debrief session in class on Wednesday!
5. If you restart or refresh Internet Explorer you will lose your data from
the current year. The simulation data is being recorded on the server at the
end of each year, so if for some reason you do lose your internet connection or
have to restart the simulation, you can quickly advance through the years you
have completed until you reach the beginning of the year that you were last
playing in. No data from completed years will be lost or overwritten. Once
you get to the start of the year that you were last playing in when you lost the
connection, all of your new data will be recorded again.
You will know that your data have NOT been recorded if at the end of a year
after visiting the board room you receive a "Server Timeout" error message. If
the "Server Timeout" error message appears, click the "retry" button (do not
click "continue" or your data for the year you just played will not be saved). If
you get the error message again after clicking "retry", you should re-start
Internet Explorer and re-run the most recent year.
The complete server timeout error message reads: "Server Timeout: If you
have disconnected from the Internet, please re-connect and click the retry
button. If you cannot connect to the Internet, you may continue, but your data
will NOT be saved. If you are connected to the Internet and still get this
message, please contact support@enspire.com."
6. At any point in the simulation, you may use the game buttons to click back
to previous decisions you have made in the same or previous years.
8. You will also be provided an individual login ID and password. After you
have submitted your team's results, you can log on as an individual player
and run the simulation as many times as you wish prior to class, and anytime
over the course of the next year.
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Module: Supply Chain Fundamentals: Matching Supply with Demand
Section: 00
Date: February 7, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic: Review of Inventory Fundamentals
Assignment: We will use this day to review multiple concepts relating to inventory models.
1. Examine the logic behind different components of inventory -- EOQ (or cycle
stock), expected lead time demand, and safety stock. Why is each of them needed in a
supply chain? Examine what would cause each of these components to be higher or
lower. Examine problem # 1 below and determine Anna's optimal inventory level
using the spreadsheet "Hamptonshire Express Proble #1."
2. Reflect on why "delayed differentiation" in the HP case reduced the need for safety
stock in the European warehouse. How would the level of optimal safety stock change
if the leadtime was 1.5 months instead of 1 month? What if the leadtime was variable
too?
Problem #1
Sheen daily wrote stories and articles around news and feature material that she
gathered from around town, and type-set the newspaper using desktop software and a
PC leased from a large Pittsburgh-area retailer. She estimated her lease cost at
approximately $ 10 per day. The newspapers were printed overnight by a local
printer at a marginal cost of $0.20 per copy (i.e., the printer charged 20 cents for
each additional copy of a newspaper). Anna sold the copies the following morning
from 6 a.m. to 10 a.m. from a newsstand at the intersection of Main Street and Center
Street in the center of Hamptonshire. Newsstand rental was $30 per day. Express
was sold to consumers for $1 per copy. Copies not sold by 10 a.m. were discarded.
Demand for newspapers was unpredictable; Sheen estimated demand daily before
delivering it to the printer. Based on data from similar entrepreneurial ventures and
interviews with potential Hamptonshire customers, she estimated that daily demand
for the Express was normally distributed with a mean of 500 and standard deviation
of 100.
a. How many newspapers should Sheen stock? Use the simulation in the spreadsheet
“Hamptonshire Express: Problem #1” to identify the optimal stocking quantity. What
is the profit at this stocking quantity?
b. Verify that the value derived in part (a) is consistent with the optimal stocking
quantity in the Newsvendor model.
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Module: Incentive Alignment and Implementation Challenges
Section: 00
Date: February 12, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic:
Assignment: 1. Diagnose the underlying causes of the difficulties that the JITD program was
created to solve. It may be useful to reflect on your experiences with the Beer Game
simulation you ran in first year TOM.
2. What are the benefits and drawbacks of the proposed JITD program?
3. What conflicts or barriers internal to Barilla does the JITD program create? What
causes these conflicts? As Giorgio Maggiali, how would you deal with these?
4. As one of Barilla's customers, what would your response to JITD be? Why?
5. In the environment in which Barilla operated in 1990, do you believe JITD (or a
similar kind of program) would be feasible? effective? If so, which customers would
you target next? How would you convince them that the JITD program was worth
trying? If not, what alternatives would you suggest to combat some of the difficulties
that Barilla's operating system faces?
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Module: Incentive Alignment and Implementation Challenges
Section: 00
Date: February 13, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic:
1. What are the greatest sources of the economic benefit that the JITD program is
intended to provide?
2. Which ditributors should Barilla target for the JITD program?
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Module: Incentive Alignment and Implementation Challenges
Section: 00
Date: February 20, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic:
2. How should Campbell structure prices for its CPR customers? What additional
policies (if any) should it put into place for its CPR partnerships?
3. What changes should Campbell make to its internal processes? When should these
changes be made?
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Module: Incentive Alignment and Implementation Challenges
Section: 00
Date: February 21, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic:
Materials: Hamptonshire Express (698053)
Aligning Incentives for Supply Chain Efficiency (600110)
Hamptonshire Problem #1
Hamptonshire Problem #2
Hamptonshire Problem #3a
Hamptonshire Problem #3c
Hamptonshire Problem #3d
Hamptonshire Problem #4a
Hamptonshire Problem #5a
Hamptonshire Problem #5b
Assignment: Read the Hamptonshire Express case. Download the 8 excel spreadsheets in the
courseware area for today's class then answer the questions for each problem
described in the case.
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Module: Retail Operations
Section: 00
Date: February 26, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic:
Assignment: 1. How should Conacher deal with the technological changes impacting book
retailing? Specially, how should he deal with the Internet retailing? You might want to
compare the websites for Amazon.com and BarnesandNoble.com.
2. Can Borders integrate the capabilities of the Internet and the retail store? What is
the role of phantom stockouts in achieving this integration?
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Module: Retail Operations
Section: 00
Date: February 28, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic:
Assignment: 1. Identify examples of supply chain conformance problems that you have
experienced either in your work or as a consumer.
Assignment: 1. Examine the features of fashion apparel retailing in Japan. How can a company use
its supply chain to compete in this environment?
2. World could replenish products in two weeks, and design and replenish new
products in six weeks. Some retailers in the US have leadtimes of over six months to
replenish similar products. Examine the supply chain at the World, and identify why
the company is able to respond so effectively.
3. Can the World's supply chain processes be replicated at other apparel companies?
What about non-apparel supply chains? Identify potential barriers.
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Module: Coordinating Retail and Manufacturing Operations
Section: 00
Date: March 6, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic: Mass Customization in Upholstered Furniture: Marketing & Retailing
Assignment: Read the on-line case and view the video clips. The (B) Case, to be covered in class
on March 12, looks at manufacturing and transportation issues for the same firm.
1. Evaluate Norwalk's business model. Examine the company's products, the location
of its stores, and its use of various retail channels.
2. How should the company plan its future growth? Should the company partner with
franchises, set up company owned stores, or sell through independent retailers?
4. Watch the related videos on the "store tour" and the "customer interaction process."
How might the internet affect the future of Norwalk's marketing and retailing model?
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Module: Coordinating Retail and Manufacturing Operations
Section: 00
Date: March 12, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic: Mass Customization in Upholstered Furniture: Manufacturing and Transportation
Assignment: Read the on-line case and view the video clips.
1. Identify the drivers of cost and leadtime in Norwalk's operations. How can the
company reduce cost and leadtime?
3. How would you expect Norwalk to perform in the future, given information in both
Norwalk (A) and (B) cases?
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Module: Coordinating Retail and Manufacturing Operations
Section: 00
Date: March 13, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic:
Assignment: 1. Read the assigned chapter and examine the "Strategic Profit Model." Contrast the
"profit path" and the "turnover path." The reading is fairly basic and all of you will
follow the logic easily. (Note: There are typos at the top of page 217: The first ratio
equals 1.15, not 2.5, and the second equals 1.83, not 4.)
2. Read the paper "Linking Finance and Operations" and reflect on the following
questions:
a. Why would you expect ROE and ROA to not differ among different segments of
retailing?
b. Would you expect inventory tuns and gross margins to differ among segments?
c. Critique the methodology in the paper to relate long-term stock market value and
various operational measures.
3. Think about the following questions before class:
a. Why have retail inventory turns not improved in recent years, despite the
considerable investment in IT? (Data show that average inventory turns across all
retailers have stayed steady at about 6 turns per year over the15 year period from
1985-2000.)
b. However, during the same period, we find considerable variation in inventory turns
at the firm level. For example, between 1985 and 2000, the Gap’s inventory turns
ranged from a low of 3.6 to a high of 6.3, Best Buy’s from 3.8 to 9.1, and Wal-Mart’s
from 4.9 to 7.2. What might explain this firm-level variation?
c. How much might we expect a firm’s inventory turns to increase with additional
capital investment (e.g. in IT, warehousing, etc.)?
d.How can we compare the inventory productivity of two retailers, such as Target and
Wal-Mart, which have different gross margins?
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Module: Factor Markets and the Role of Intermediaries
Section: 00
Date: March 14, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic:
Assignment: 1. Analyze the "Prato system." How does it work? What is the role of the impannatore
and how will that role change with the new technology?
Materials: HBR Article: An Interview with Victor Fung "Fast, Global and
Entrepreneurial: Supply Chain Management, Hong Kong Style" 98507
Opening Slides
Assignment: 1. Why does Li and Fung "break up the value chain and rationalize where they do
things"? How does this add value to the supply chain?
2. How does Li and Fung make the supply chain more responsive (i.e. reduce
response time)?
4. Identify salient features of a "global" supply chain and how an intermediary like Li
and Fung can add value to such a chain.
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Module: Analytical Techniques for Supply Chain Management (Optional)
Section: 00
Date: March 28, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic: Analytical Session 1: Forecasting Time Series
Assignment: Read pages 55-87 in Chapter 2 from Production and Operations Analysis by Steven
Nahmias. Focus on the following sections. (Note: A data file for the assigned
problems is posted in the courseware section for today's class.
1. In section 2.6, examine the various measures that have been identified to evaluate
forecasts. Read example 2.1 to understand the approaches. Solve problem # 13 on
page 66 (Problems for Section 6.)
3. Section 2.8 describes how regression analysis could be used for forecasting when
the underlying series has trend. Example 2.4 on page 78 provides an example of how
regression analysis can be used. Try to solve problem 2.4 on your own using Excel for
the regression analysis (To use Excel for regression, look under the "Tools" menu for
"Data Analysis"--the rest of the steps will hopefully be obvious. If not, use the Help
tool in Excel to learn about the "Regression analysis tool." Check your numbers with
Nahmias'.)
4. In section 2.9, read example 2.6, example 2.7. Solve problem #33 on page 87
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Module: Analytical Techniques for Supply Chain Management (Optional)
Section: 00
Date: April 2, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic: Analytical Session 2: Inventory Models
Assignment: Please plan to come prepared to discuss Dan Williams questions in the Chemplan
case.
Specifically:
1. Run the regression using Construction Index as an independent variable. What are
the R-squared and standard error? Predict the paint sales for 1965 given that estimated
Construction Index in 1965 is 50.
2. Run the regression using Loans and Construction Index as explanatory variables
(Sales = a1 + b1* Loan + c1* Construction). What are the R-squared and standard
error of the regression? Is this regression better than the regression in question 1?
Predict the paint sales for 1965 based on the regression model.
3. What happens when we use all three independent variables in the regression (i.e.,
Sales = a2 + b2*Year + c2*Loan + d2*Construction)?
For Nopane:
Assume that you believe Silk’s hypothesis about competition, which is that "Nopane’s
competitors will react to our national strategy the same way as they did in the test."
Further assume that Silk decides to spend an advertising level of $8.00.
1. Which regression or regressions would you use to estimate the effect of emotional
versus rational copy?
2. Using your selected regression or regressions, calculate the best estimate (point
forecast) of the unit sales of Nopane in a Segment A sales territory if:
(a) you use emotional copy for your advertising campaign,
(b) you use rational copy for your advertising campaign.
3. Which type of copy, the emotional or rational approach, would you prefer?
The Nopane data file and regressions are located in the courseware section for today's
class.
The Chemplan data file is located in the courseware section for today's class.
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Module: Analytical Techniques for Supply Chain Management (Optional)
Section: 00
Date: April 3, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic: Analytical Session 3: Aggregate Production Planning
3. In class, we will demonstrate how such linear programs can be solved using
Microsoft Excel "Solver" and we will examine how the output from "Solver" can be
interpreted.
Assignment: We will review concepts from Linear Programming and discuss the case "Short-Run
Manufcaturing Problems at DEC." Please attampt to formulate the decision problem
at DEC as a linear program. I recognize that some of you, because you are new to
linear programs, might find this exercise challenging. Try to solve the problem using
Excel solver.
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Module: Analytical Techniques for Supply Chain Management (Optional)
Section: 00
Date: April 10, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic: Analytical Session 5: Inventory Models
Assignment: Read "Yield Management at American Airlines" for an overview of the use of
quantitative tools applied to yield management in the airline industry.
Read the case "Revenue Management at Atlantic Air" and analyze the two scenarios
described on page 9, using the spreadsheet model for the case that is posted on the
course platform
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Module: Analytical Techniques for Supply Chain Management (Optional)
Section: 00
Date: April 16, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic: Analytical Session 6
Assignment:
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Module: Analytical Techniques for Supply Chain Management (Optional)
Section: 00
Date: April 17, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic: Ananlytical Session 7
Assignment:
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Module: Analytical Techniques for Supply Chain Management (Optional)
Section: 00
Date: April 24, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic: Ananlytical Session 8
Assignment: 1. Identify the factors behind i2's success. Why is the company's stock valued so
highly by investors? Examine the company's products, its sales and implementation
process, its SOA process, etc.
2. Hasso Plattner, co-CEO of SAP was quoted saying, "We're SAP. We dominate the
most important category of enterprise software. We intend to control all the enterprise
software our customers use. If our partners cross us, we will crush them into dust".
Given SAP's ambitions, comment on i2's future in the Enterprise Application Market.
(“The E-Ware War: Competition Comes to Enterprise Software,” David KirkPatrick,
Fortune, December 7, 1998)
Assignment: Class discussion will focus on the articulation of course learning. Students should
come to class prepared to share their key learnings from the course. In addition to
providing a forum for discussing learnings from the course in general, this final class
will allow an opportunity for those who took different "tracks" to share their learning
from those different experiences with each other. Those who wrote papers should be
prepared to share with others in the class their key learnings from their research; those
who took the analytics track should be prepared to share their key learnings from the
analytics sessions with those who wrote papers.
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Module: Analytical Techniques for Supply Chain Management (Optional)
Section: 00
Date: May 1, 2003
Time: 8:30 AM
Location: Aldrich Hall 12
Topic:
Assignment:
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