Supply Chain Modelling and Simulation_My_Guru_Software

Simulation and modeling using My Guru software

Details

1. Introduction
A company has a long-running distribution network with one (1) warehouse and three (3)
distributions centres in the UK. Having reviewed its current operations, the company is intending to
close all existing distribution centres and set up one large distribution centre.
2. Assignment
You have been asked to simulate both networks (existing and proposed) to evaluate their
performances.
3. Data
(a) Product
Cost = £100
Selling Price = £200
(b) Existing Facilities
Facility Location
Warehouse London
Distribution Centre DC1 Birmingham
Distribution Centre DC2 Leeds
Distribution Centre DC3 Glasgow
(c) Demand
Distribution Centre Customer locations served by the
distribution centre
Weekly Demand
DC1 (Birmingham) Birmingham 100*[Group No]
Cardiff 750*[Group No]
DC2 (Leeds) Leeds 1250*[Group No]
Liverpool 500*[Group No]
Manchester 1000*[Group No]
DC3 (Glasgow) Glasgow 900*[Group No]
Edinburgh 1500*[Group No]
Dundee 400*[Group No]
All weekly demands are subjected to + 10% variation
(d) Transportation Times
All distribution centres take a day to deliver shipments to customer locations.
(e) New DC
New DC (instead of 3 existing DCs) is to be in Sheffield. It will serve all current customer
locations in the country.

4. Model Building & Execution
Stage 1 – Modelling existing network
You are required to estimate Reorder Level (R) and Reorder Quantity (Q) for each storage location in
the network. These estimates need to be used in the SCG model.
Stage 2 – New Network
Use the same demand data and estimate R and Q for each storage location and use them in
the simulation model.
Simulation run length – 3 months
No of replications per experiment = 4
5. Report
Produce a report to present the following information.
(a) Introduction to the simulation study, outlining the purpose of the simulation (1/2 page)
(b) Tables containing R and Q estimates used in the model and how they were derived.
(c) Your choice of performance indicators for comparison of two networks. You need to justify your
choice of performance indicators.
(d) For the above project, the company has used a consulting firm. But for future projects, it is
considering building simulation capabilities internally (software and skills). How do you advise the
company on avoiding pitfalls in simulation projects? (3/4 – 1 page maximum)