Manufacturing game Part 1 Chapter 1 Introduction Version

Manufacturing game Part 1 - Chapter 1 Introduction Version : August 2009 © Léger et al. 2009. 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 2009 © SAP 2009 / Page 3 © Léger et al. 2009. 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 2009 © SAP 2009 / Page 4 © Léger et al. 2009. 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 2009 © SAP 2009 / Page 5 © Léger et al. 2009. 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 2009 © SAP 2009 / Page 6 © Léger et al. 2009. 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 2009 © SAP 2009 / Page 7 © Léger et al. 2009. 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=XYFJASo. YGps Version : August 2009 © Léger et al. 2009. 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 2009 © Léger et al. 2009. 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 Version : August 2009 © Léger et al. 2009. 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 2009 1. 0 KG © Léger et al. 2009. 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 2009 © Léger et al. 2009. 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 2009 © Léger et al. 2009. 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 cashto-cash cycle Version : August 2009 © Léger et al. 2009. 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 2009 © Léger et al. 2009. 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 2009 © Léger et al. 2009. 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

DC 10 Hypermarkets • • • Buy only large boxes (1 kg) Payment delay of 30 days More sensitive to price Less sensistive to advertising No partial orders - Must be able to obtain the full order in order to buy from a particular plant. • Buy about 3 different products Version : August 2009 © HEC Montréal 2009 / Page 18 © Léger et al. 2009. 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

DC 12 Grocery chains • Buy small boxes (0. 5 kg) and large boxes (1 kg) • Variable payment delay between 15 to 20 days • Buy about 4 different products – seek to buy those from a unique vendor Version : August 2009 © HEC Montréal 2009 / Page 19 © Léger et al. 2009. 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

DC 14 Independent grocers • • Only buy small boxes (0. 5 kg) Less price sensitive Sensitive to advertising Variable payment delay between 5 to 30 days • Buy about 2 different products Version : August 2009 © HEC Montréal 2009 / Page 20 © Léger et al. 2009. 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 2009 © Léger et al. 2009. 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 2009 © Léger et al. 2009. 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 2009 © Léger et al. 2009. 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 boxes and space for 1, 000 bags • Additional warehouse space can be rented: • 100, 000 boxes (or part thereof), @ € 200/day (less than € 0. 01 per box per day) • 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 2009 © HEC Montréal 2009 / Page 24 © Léger et al. 2009. 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

Fixed costs per week Version : August 2009 © Léger et al. 2009. 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 • Interest payment and loan renegotiation • Customers do not change throughout the game, hence you may learn from their past behaviour • The company displaying the highest shareholder’s equity at the end of the simulation wins the game • You must behave ethically at all times • At the end of the game, raw material and finished goods inventory will be sold out at a reduced price (optional) Version : August 2009 © Léger et al. 2009. 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 2009 © Léger et al. 2009. 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

Pre-register now ! http: //erpsim. hec. ca/competition/ Version : August 2009 © Léger et al. 2009. 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