Logistics Process Diagnostics was one of the first modules I took with the Logistics Institute. It was and still is one of my favourite modules taken thus far, the facilitators and course content was amazing.
The “Beer game” is used to drive home the “Bull Whip Effect” and what causes it to occur. The bull whip effect is mainly caused by three underlying problems: 1) a lack of information, 2) the structure of the supply chain and 3) a lack of collaboration.
The Game: you are assigned to a group of 4 and participate as the Supplier, Manufacturer, Distributor or Retailer. 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.
The aim of the players is rather simple: each of the four groups must fulfill incoming orders of beer by placing orders with the next upstream party.
Communication and collaboration are not allowed between supply chain stages, so players invariably create the so called Bull Whip Effect.