April 1996 € Volume 23 € Number 2
Supply Chain Simulation Model
The analysts at IBM Research developed a supply chain simulation model
that allowed detailed modeling of various business processes of a manufacturing
and distribution supply chain (see Figure 4). The discrete event simulation
was implemented in the MODSIM II object-oriented simulation language from
CACI Products Company. Many of the ideas used in developing the supply chain
simulation objects have been incorporated into SIMPROCESS, a software tool
for business process modeling marketed by CACI and jointly developed by
IBM Research and CACI.
Figure 4
The modeling system consisted of a set of approximately 80 objects which
can be used to represent supply chain processes. These simulation objects
can be broadly partitioned into three groups: nodes, entities and supporting
data structures. The nodes captured the behavior of various business functions
such as manufacturing, transportation, supply planning and customers. Movement
of both physical goods (e.g. products being delivered) as well as information
(e.g. base plans and customer orders) were modeled by various types of entities.
The support class category contained other information necessary to model
and analyze a supply chain such as bills of material and statistical output
reports.
Creating a model of the European PC business was then a matter of integrating
these objects into a network that represented all the relevant business
processes and their interactions. The next step was to collect appropriate
data that would drive the simulation. After a validation process which involved
comparing simulation output with historical data, numerous experiments were
performed to evaluate alternative business strategies under different market
scenarios.
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