Teaching supply chain management through global projects with global project teams

Production and Operations Management, Spring 2000 by Kopczak, Laura Rock, Fransoo, Jan C

Knowledge and Application of SCM and IS Theory

Most projects require the students to perform traditional analyses of supply chain structure, physical flows, information flows, planning and manufacturing cycle times, and inventory policies and how they affect the cost/service trade-off curve. Students typically apply simple inventory models, such as the news vendor model and periodic or continuous replenishment models. They also analyze the supply chain and recommend where inventory control points should be located and how control should be implemented. These types of models were used in an early project that compared the use of country-based versus regional distribution centers for distributing Hewlett-Packard LaserJet printers in Latin America and in Eastern Europe. They were later used in a project sponsored by Texas Instruments and Nokia to address the question of how to achieve flexibility-through inventory or through capacity. Multiechelon models were used in the Ericsson-sponsored project on spare parts and in the Manugistics-- sponsored project on pharmaceutical industry supply chains.

Recently, companies have been interested in understanding how information flows can be streamlined to reduce inventory levels and to move the Customer Order Decoupling Point farther upstream. In one project, the students measured the Bullwhip Effect. In the project that Lucent sponsored, students compared supply chain performance under MxP-based procurement to performance under an alternative, pull-based procurement system that generated demand signals for suppliers based on shipments to customers. Companies are also interested in Internet-based solutions and recommendations about software and systems. We have been able to provide this analysis by identifying the project requirement early and selecting a Stanford student who has worked for an enterprise or supply chain software company to be on the project team. Furthermore, since Stanford is in Silicon Valley, it has been easy for Stanford students to visit leading-edge software companies.

The crc seeks to reinforce, apply, and develop concepts that have already been studied in a lecture-based class. Thus, this class complements other classes that most of the students have taken. (See Table 2 for a listing of the main SCM-related courses at Eindhoven and Stanford and the topics covered.) Some of the students, however, need to play catch-up while in the class. Although this learning process suffices for the purposes of the project, we believe that a regular structured class adds this type of value in a more effective and efficient way.

One issue that we have encountered is a strong tendency for students to favor the literature and theories that are most familiar to them and to reject theories suggested by the other half of the team. For example, while the U.S. students know about postponement, the Dutch students are familiar with the Customer Order Decoupling Point. The concepts are both useful and can be used together, but it can be a challenge to get the teams to accept them. We mention this issue during the kick-off and deal with it to some extent by having students use the same inventory textbook by Silver, Pyke, and Peterson (see Appendix A). We also work with the team early to generate a list of potentially useful theoretical concepts and then provide papers on those concepts for the whole team to read. We also suggest teaching cases and papers about best practices for the team to read. Some of the papers that we have found to be useful are listed in Appendix A. This list corresponds to some extent to the papers that students read in their lecture-based classes. Since the Dutch students read additional papers in Dutch that are therefore not accessible to the full team, our list is understandably U.S.-centric.