Developing Students’ Understanding of Co-opetition and Multilevel Inventory Management Strategies in Supply Chains: An In-Class Spreadsheet Simulation Exercise

Abstract

Instructors look for ways to explain to students how supply chains can be constructed so that competing suppliers can work together to improve inventory management performance (i.e., a phenomenon known as co-opetition). An Excel spreadsheet-driven simulation is presented that models a complete multilevel supply chain system—customer, retailer, wholesaler, distributor, and manufacturer—for up to six competing products. Students are provided the opportunity to compare the inventory cost and other key performance metrics of the alternative multilevel supply chain structures. This article explains the simulation model, describes the instructional approach, and presents assessment results from students in an introductory operations management course. Students find that the simulation is easy to use and helps them understand the performance impact of strategic supplier collaborations on supply chain operating performance.