Manufacturing game
Pierre-Majorique LÉGER
Jacques ROBERT
Gilbert BABIN
Robert PELLERIN
Bret WAGNER
Version : August 2011
Part 1 - Chapter 1
Introduction
Copyright © 2011 HEC Montréal
ERP Simulation Game
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
What’s an ERP?
Each team of 4 to 5 players…
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Running a make-to-stock company…
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Before ERP systems
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
With an integrated enterprise system
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Collaborating using the end-to-end
power of SAP !
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Description of your
new company
Welcome to your new job !
http://www.youtube.com/watch?v=XYFJASoYGps
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Location of the 26 companies
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Muesli Cereals
Wheat
Oats
Nuts
Raisins
Blueberries
Version : August 2011
Strawberries
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Product size
0.5 KG
Version : August 2011
1.0 KG
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Your 6 products
40% wheat
40% oat
20% nut
1 box
1 bag
40% wheat
40% oat
20% raisin
1 box
1 bag
40% wheat
40% oat
20% blueberry
1 box
1 bag
50% wheat
50% oat
1 box
1 bag
40% wheat
40% oat
20% strawberry
1 box
1 bag
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
35% wheat
35% oat
10% raisin
10% nut
5% strawberry
5% blueberry
1 box
1 bag
Muesli Manufacturing
Association Label Regulation
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Operations in the
cash-to-cash cycle
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Input Cost
at low seasonal price
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Number of stores by
geographical area
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
DC10
Hypermarkets
•
•
•
•
•
Buy only large boxes (1 kg)
Payment delay of 20 days
More sensitive to price
Less sensitive to advertising
Will have a stronger preference for 3 particular
products during the simulation
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
DC12
Grocery chains
• Buy small boxes (0.5 kg) and large boxes (1 kg)
• Payment delay of 10 to 15 days
• Will have a stronger preference for 4 particular
products during the simulation
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
DC14
Independent grocers
•
•
•
•
•
Only buy small boxes (0.5 kg)
Less price sensitive
Sensitive to advertising
Payment delay of 5 to 10 days
Will have a stronger preference for 2 particular
products during the simulation
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Number of retailers per
Länders
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Risk premium on credit
ratings
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Production improvements
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Warehousing cost
automatically charged
• Each team has 3 warehouse storage areas:
• Finished product - space for 250,000 boxes
• Raw materials - space for 250,000 kg
• Packaging - space for 1,000,000 boxes and space for 1,000,000
bags
• Additional warehouse space can be rented:
• 100,000 boxes (or part thereof), @ € 200/day (less than € 0.01
per box per step)
• 100,000 kg (or part thereof), @ € 350/day (more expensive
because it's raw food product)
• 100,000 boxes AND/OR bags (or part thereof), @ € 50 day
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Total costs per week
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Review of the major rules
• You may not change the recipe of a product if you are
still carrying inventory
• Customers preferences do not change throughout the
game, hence you may learn from their past behavior
• The company displaying the highest shareholder’s
equity at the end of the simulation wins the game
• You must behave ethically at all times
• The end of game inventory will be value at cost price
in the final balance sheet. Therefore, you shouldn’t sell
under cost at any time during the game.
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca
Elements of a winning strategy
• Use the ERP system efficiently
• Do not run out of stock
• Delays, production capacities and liquidity
constraints are important elements of the game
• Exploration and exploitation
• Team organization is more important than you
think
• Have fun!
Version : August 2011
© Léger et al. 2011 ERPsim is proprietary technology developed by researchers at HEC Montréal, École Polytechnique de Montréal and Western Michigan
Univ. ERPsim is owned by Polyvalor and Valorisation Gestion and commericialized by Baton Simulations. More info at erpsim.hec.ca