Web-Based Beer Game: Logistic Challenges - Essay Example

Introduction
The understanding of the web-based beer game could be applied in situations of logistic challenges and the outcome of the decisions taken in order to solve the logistic challenges which could be analyzed. The costs involved in the distribution of goods include the cost of inventory and the back-order cost. The total cost of the distribution system is the sum of the costs of inventory and the back order in each of the four stages.

Discussion: Logistic challenges in the supply of stationery paper/pen and computers
The logistic challenges are present in the requirement of stationery pens and papers, computers in the university. The rise in demand for stationery items as well as computers requires the suppliers to provide more stationery items and computers as required during the course of the university. The increase in the number of students and increase in the number of courses conducted by the university led to the requirement of more number of stationery items like pen and paper and also educational systems like computers. The logistic challenge that has been faced is that the procurement and supply of an increased number of items are needed to occur through four different stages of the factory, distributor, wholesaler, and retailer. The level of the available inventory in each of the four different stages is a point of concern for the distributor, wholesaler, and retailer which comprises the distribution system. The level of inventory against the level of demand is the most crucial part in dealing with the delay in the distribution of the items required (Kook, 2013, p.3). The supply of the stationery items like pens and paper, computers are delayed with the increase in the intermediate players starting from the retailers, wholesalers, and distributors. The logistic challenge is even more when the suppliers, wholesalers, and dealers run out of stock. This increases the backorder cost of the distribution system. These are the wholesome challenges in logistics that are faced due to the increase in demand for stationery items and computers in the university.

Bullwhip effect
The Bullwhip effect is an effect in the logistics and distribution system which is observed in the forecasting of the supply of goods in the distribution channel. The bull-whip effect shows that the changes in the level of inventory undergo a greater change due to the change in the level of demand of goods. In the case of rising demand for stationery items like pen and paper, computers there would be bull-whipped effect in the distribution system for supplying the goods to the university. A change in demand of the goods would require the retailer, wholesaler, and the distributor to maintain a higher level of inventory as compared to the demand in order to keep an allowance for the delay in the distribution system and to keep the inventory cost and the back order cost under control. Thus the bullwhip effect gives rise to greater change in the level of inventory in response to a change in the level of demand of the stationary items and the computer.

Conclusion
The challenges in the logistics and distribution system for the supply of stationery items and computers due to changes in the pattern of demand could be explained by the web-based beer game. The challenges in the distribution of the goods to the university are mainly due to the delay in the supply of goods across the supply chain that includes the factory, distributors, wholesalers, and the distributors. The delay occurs due to the lack of inventory present with the distributors, wholesalers, and retailers. There are cases when the wholesaler, distributor, and retailer run out of stock. For this reason, order for the required items is placed at a higher level than the actual demand which increases the backorder cost. The changes in the level of inventory in higher proportions to the change in the demand are explained by the Bullwhip effect.