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Fundamentals of Channel Management

Target courses: The Fundamentals of Channel Management simulation is targeted at almost any supply chain (logistics) course where there is a desire to give students experience in setting up and managing a supply chain. The focus is on the development and maintenance of business-to-business relationships between teams who become either suppliers or distributors of microcomputers.

Content: This simulation is a shortened and abbreviated version of the Supply Chain and Channel Management Simulation. Marketing, sales channel, accounting, and finance decisions are simplified while business-to-business operations are deeply explored. Students will discover the challenges and rewards of setting up and managing a lean, reliable supply chain within a one-year time frame (4 quarters or decision periods).

The simulation is ideal in situations where there is limited time to run a simulation within the course design.

Time frame: The game is set for 4 decision rounds, with each round taking 2 to 3 hours to complete.

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The demo below highlights the key decision areas of this simulation.

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More details: The Fundamentals of Channel Management simulation is targeted at almost any supply chain (logistics) course where there is a desire to give students experience in setting up and managing a supply chain.

At the outset of the exercise, student teams must choose between the two roles of supplier or distributor. If they choose to become a distributor, they must find suppliers who can produce the goods they wish to sell to the end user market. If they choose to become suppliers, then they must approach distributors to become their sources of supply.

The channel element provides the students with a full set of supply-chain options, allowing them to make investments to speed up and better coordinate the exchanges between business partners. After a series of such expenditures, suppliers will be able to fulfill a reseller's orders without inventory ever touching the reseller's warehouse. However, achieving this level of supply-chain coordination requires extensive negotiations and trust between the parties.

The supply chain looms ever larger as a component of today's business. The outsourcing component can help business students appreciate the complexities of supply-chain management. It's very easy for students to believe they can develop a business simply by outsourcing everything. In reality, it isn't so easy to do. It requires more than the intention. It takes lots of work, lots of time, and lots of building up of relationships and channels.

The Fundamentals of Channel Management simulation gives students in-depth exposure to what actually goes into making supply chains work. They learn that it is not easy to execute a supply chain strategy; it's very complex; there are many conflicts. They have to learn to balance selfishness and short-term gain with the potential for greater reward in the long-term.

One important skill students will practice in the outsourcing module is negotiation. Students will learn to negotiate to achieve desired ends. It's a stimulating activity, but it can be frustrating. They must learn about the setting of priorities and attainment of mutual goals.

The simulation is about learning to look at the end result and focusing on that win-win solution, but recognizing that it's not easy to get there. It takes negotiation, cooperation, and coordination. It's important to recognize, even with all the hard work through the complicated process of building relationships and putting channels in place, that things can still go wrong.

Students can play against their peers. The grading is based on the balanced scorecard that measures profitability, customer satisfaction, market share in the targeted market segments, human resource management, asset management, preparedness for the future and wealth.

Sample instructor materials:

	PowerPoint Presentation
	Game scenario
	Sequence of activities

Note: Full set of instructor materials is available for registered Instructors.

View the complete list of simulations for different courses and their decision content

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