Simulating Effects of Supply Chain Configuration on Industrial Dynamics in the Forest Sector

Abstract

Two wood games are developed based on the structure and dynamics of the Beer Game. By introducing divergent and convergent flows in the supply chain, the relevance to the forest sector is increased. Using eight players in each run, the game is, in essence, a simulation tool that includes the human aspect in decision-making. The wood game is used to simulate the challenges that may be met when introducing a greater degree of customer orientation in the forest sector.

Performance is measured using total system costs, amplification of demand variation and basic statistics of order rates. Results from pilot experiments indicate that performance and predictability of the system are negatively affected by increasing the complexity of the supply chain. The level of demand distortion varies considerably between different games. Distorted demand signals may complicate the planning and execution of upstream operations.

Keywords:

• Forest sector
• supply chain performance
• multiple feedback
• demand distortion
• parallel interactions
• human decision making