Global Supply Simulation Presentation - Team 14

1. Simulation
Global Supply Chain
Team 14: Ian Davidson, John Sherril, & Uchenna Okezie
C580 - Operations Management
Due: February 27, 2016

2. February 27, 2016
1) How did you think about which options to choose (i.e.,
What criteria did you use to select options? What were the trade offs
you considered? What analyses did you conduct?)
• Options were selected for driving the profitability of the
models.
• Consensus of the forecasting team were also taken into
consideration.
• Large variations in the recommendation of an option
indicated more risk in that option.

3. February 27, 2016
2) The Forecast Room: What did you use for your
forecast?
• A high standard deviation indicates more risk that a model
may be overstocked.
• A lower markdown price indicated more risk in overstocking
a model, but potential for higher profit margins.
• A higher stocking cost indicated more risk in overstocking a
model.

4. February 27, 2016
3) The Production Room: How did you decide which
suppliers to use? How did you think about setting initial
production levels? How did you decide whether to issue
production change order?
• A dual supplier strategy was used – one overseas for low
cost and one local for flexibility to meet demand (which is
necessary for stability).
• Initial production levels were set based on the average
forecasts, and supplier advantages and capabilities.
-The local supplier’s initial order was sized to be able to
increase or decrease as needed once demand develops.
-The higher risk of model B was well suited for local
production.
• To better meet demand, change orders were used sparingly,
and for the local supplier only.

5. February 27, 2016
3a) How did you think about the value of adjusting
production levels compared to the $2 million cost?
Did you invest in the Celldex show? How did you think
about the value of the information compared to the $2
million cost?
• The 2 million dollar price of a change order is well worth the
cost compared to the better opportunity to meet demand.
- This is most useful with the local suppliers due to time to
respond.
• Celldex was invested in; and it was useful to be able to view
demand more accurately to issue a more effective change
order.

6. February 27, 2016
5) What advice would you give to your colleagues who will
be doing this simulation in the spring quarter?
• Supplier selection was handled well and would not be
changed to achieve maximum profit.
• Change orders were issued effectively –
-Minimum number of change orders,
-Used to match Celldex demand,
-Used with local suppliers only.
• Inventory could have been managed better;
-Starting with inventory levels too high and overseas
caused problems in not being flexible to adapt.

7. Team Results:
Year 1 Year 2
February 27, 2016

8. Team Results:
Year 3 Year 4
February 27, 2016

9. February 27, 2016
This Concludes Our Presentation.

10. February 27, 2016
This Concludes Our Presentation.