The game illustrates in a compelling way the effects of poor system understanding and poor communication for even a relatively simple and idealized supply chain. At the end during the debriefing, it is explained that these feelings are common and that reactions based on these feelings within supply chains create the bullwhip effect. The team or supply chain that achieves the lowest total costs wins. Players look to one another within their supply chain frantically trying to figure out where things are going wrong. The retailer draws from a deck of cards for what the customer demands, and the manufacturer places an order which, in turn, becomes product in four weeks. In the board game version, players cannot see anything other than what is communicated to them through pieces of paper with numbers written on them, signifying orders or product. There is a one-point cost for holding excess inventory and a one-point cost for any backlog (old backlog + orders - current inventory).

Make order decision: Decide how many units are needed to order to maintain stock.Īs previously said, there are four stages, manufacturer, distributor, supplier, retailer, with a two-week communication gap of orders toward the upstream and a two-week supply chain delay of product towards the downstream.

Deliver beer: Deliver as much beer as a player can to satisfy the demand (in this game the step is performed automatically).

Check orders: How many units the customer has ordered.

Check deliveries: How many units of beer are being delivered to the player from the wholesaler.

The game is played in 24 rounds and in each round of the game the following four steps have to be performed: The goal of the game is to meet customer demand with minimal expenditure on back orders and inventory. The task is to produce and deliver units of beer: the factory produces, and the other three stages deliver the beer units until it reaches the customer at the downstream end of the chain. In the beer game participants enact a four-stage supply chain. The beer game was a result of his work on system dynamics. The Beer Game was invented by Jay Wright Forrester at the MIT Sloan School of Management in 1960. Therefore, the order taking of a group also highly depends on decisions of the other groups. Each group can highly influence the entire supply chain by ordering too much or too little which can lead to a bullwhip effect. Therefore, each group has only significant control over their own part of the supply chain. The most interesting part of the game is that each group has no control over another part of the supply chain.

Due to lack of information, suppliers, manufacturers, sales people and customers often have an incomplete understanding of what the real demand of an order is. This game outlines the importance of information sharing, supply chain management and collaboration throughout a supply chain process. The game represents a supply chain with a non-coordinated process where problems arise due to lack of information sharing. It reflects a role-play simulation where several participants play with each other. The beer distribution game (also known as the beer game) is an educational game that is used to experience typical coordination problems of a supply chain process. Recommended for graduate students, members of the business management community Multiple teams with a minimum of 4 playersĦ0–90 minutes another 60–90 minutes for debriefing

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