Define the four entities (Products, Facilities, Vehicles, Routes) and place them on the map to create a model of your supply chain. Then simulate how your supply chain will perform. This page is a quick start guide for running simulations and working with the data that simulations produce.
Watch the video and scan the screenshots below
This video shows examples from the Cincinnati Seasonings case study, but what you see here applies equally to any other case study. In the screenshots below we show examples from the Collaborative Supply Chains case study.
All supply chain models must be approximations to some degree because making absolutely precise measurements of supply chain entities in the real world is not possible. You can make very precise operating measurements at the level of an individual facility such as a factory or warehouse because within that facility you have a lot of control over what happens (so fractions of meters and minutes are meaningful). But what level of precision is realistic when measuring operations across an entire supply chain operating out in the world?
It is not possible to get absolutely precise weights and measurements of every product and shipping container in a supply chain. It is not possible to predict or control external factors impacting supply chain operations such as traffic jams, accidents and breakdowns, storms and disasters. So data used must be averages reflecting this reality. Use best data available for defining your supply chain model, but do not obsess over levels of accuracy beyond what is realistic (see more about this in All Supply Chain Models are Approximations).
SIMULATING SUPPLY CHAINS — IMPROVING THEIR DESIGN
Follow these 8 steps shown in the screenshots below to simulate performance of your supply chain and improve its design based on simulation results:
NOTE: Make sure there are no blank numeric fields for any values in the supply chain entities. If you erase a number for one of the entities, either type in a new number, or type in a zero, do not leave it blank.
Step 1 — To start a simulation, click the “Simulation” Button on supply chain edit screen.
Step 2 — A new browser tab opens when you click the “Simulation” button. This simulation screen is where you run simulations. Click the “Play” button on the simulation screen to start a simulation.
Step 3 — When the simulation begins, the supply chain operations data generated by the simulation is displayed on the right side of the screen. Vehicles are also shown as they move on the routes to carry products between facilities. Vehicle positions on the map are shown as hourly snapshots so slow moving vehicles move more smoothly and fast moving vehicles move in jumpy motions. Scroll through the list of facilities and click on different facilities to see graphic and numeric displays of their performance. Learn more about analyzing this simulation data in “Analyzing Simulation Data“.
Step 4 — A simulation will run until it finds one or more points of failure. Points of failure are facilities in the supply chain that either run out of products or that accumulate too much on-hand products and thus run out of storage space.
Step 5 — Data displays provide information about supply chain performance. Use this data to assess what is happening and fix points of failure. Shown below are examples of the data displays available under the four data tabs. The facility tab shows data about facilities. The vehicle tab shows vehicle data, and the products tab shows product data. The console tab shows all the data. Click on the button labeled “Export Results to Excel” to export the simulation data as a spreadsheet (a CSV file) to your PC or laptop. Learn more about analyzing simulation data in “Analyzing Simulation Data“.
Step 6 — Leave the simulation browser tab open so that you can refer back to the data as needed. Click on the browser tab for the screen where you edit the definitions of the four entities (Products, Facilities, Vehicles, Routes).
Step 7 — Make changes to products, facilities, vehicles and routes as needed to fix the point of failure that caused the simulation to stop. On the edit screen, use the accordion menu on the right to select the products, facilities, vehicles, and routes that you wish to change. Make changes and click “Update” button to record those changes. From time to time, as you make changes, it is good to click the browser refresh button to synchronize those changes and update the supply chain data model.
Step 8 — You flip back and forth between the two browser tabs as you encounter points of failure in your supply chain design and fix those problems, . On the edit tab you edit the definitions of the four entities to fix points of failure, and on the simulation tab you run the simulation again to see what happens. Always click browser refresh or “Refresh Supply Chain” button on the simulation screen before running a new simulation.
If you go back to EDIT screen before playing the simulation and make more changes, you need to click browser refresh on SIMULATION screen to update the simulation with those additional charges before you play the simulation.
TIP: SAVE BACKUP COPIES of your supply chain model from time to time as you make changes. Click “Save” button next to your model in Account Management screen. There is no “undo”, but if a change doesn’t work out, you can restore from a saved copy. And sometimes supply chain model files (json files) become damaged and they no longer work, so you want backup copies of your supply chain to restore from when that happens.
To send a copy of your supply chain model (.json file) to other SCM Globe users see ““Download and Share Supply Chain Models”
DIFFERENCE BETWEEN SIMULATION AND OPTIMIZATION
THERE ARE BIG DIFFERENCES between simulation and optimization. SCM Globe does simulations, and the simulations generate data that can be used for optimizations. We provide spreadsheet templates where you can import simulation data and run optimizing algorithms on that data. Learn more about this in “Analyzing Simulation Data“ (scroll down to “Download Simulation Data to Spreadsheet Reporting Templates”).
SIMULATION allows you to model any existing or proposed supply chain and see how it works. It shows how different supply chain designs will work, and what their costs and performance levels will be. Simulations show which supply chain designs work best in any given situation. They let you see how supply chain entities interact with each other, and how the entire supply chain works as a unified system. Simulations also generate data that can be used in optimizations.
OPTIMIZATION allows you to take a single supply chain design and optimize specific variables in order to obtain the best possible performance from that design. Optimizations refine existing designs, but they do not create new designs. Optimizations used for supply chains in high change environments require that every time a variable changes (such as fuel prices, rent or labor costs, demand forecasts, procurement costs etc.) a new optimization should be done to take those changes into account. Last month’s optimized solution can quickly become this month’s big mistake.
Real world supply chains work toward optimal performance, but can never actually achieve optimal performance because unforeseen events caused by factors out of our control always force supply chain operations to be less than optimal. The best approach is to use simulations to identify good supply chain designs, then optimize their performance as best you can, knowing that you must continually re-optimize as prices and demand levels change. Good performance in a good supply chain design beats optimized performance in a bad supply chain design. There is no automated algorithm to replace people thinking creatively. Simulations let you try out ideas and see what works best in different situations. Use continuous simulations like radar to probe through the fog of uncertainty on the road ahead and find the best ways to respond as events unfold.
An informative article in Supply Chain Digest expands on the differences between simulation and optimization – http://www.scdigest.com/assets/FirstThoughts/07-05-31.php
You can learn more about the modeling and simulation logic used by SCM Globe in “Supply Chain Modeling and Simulation Logic”
…NOW VIEW THE LAST quick start tutorial — “How to Work with Case Studies“
NOTE: The academic version of SCM Globe supports supply chain models containing up to 15 – 20 products and a similar number of facilities, vehicles and routes. Models exceeding these limits will run slowly and experience other problems. See “Tips for Building Supply Chain Models” for ways to work with these limits and other useful techniques you will need when you build new supply chains or add new products, facilities, vehicles and/or routes to existing supply chains.
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