Vol. 5, No. 2, January 2005, pp. 80–83
issn 1532-0545 05 0502 0080
informs
®
doi 10.1287/ited.5.2.80
© 2005 INFORMS
I N F O R M S
Transactions on Education
Making Operations Management Fun:
Littlefield Technologies
Julia Miyaoka
Department of Decision Sciences, College of Business, San Francisco State University,
jmiyaoka@sfsu.edu
the students see it on the simulation web page. Students can obtain information about their factory and
make decisions by clicking on the icons on the factory layout. The simulator runs such that one hour in
real time is equivalent to one day in the factory. This
allows the run time to represent the product lifetime.
There is also a competitive aspect to the simulation.
Throughout the simulation teams are continuously
ranked from first to last based on their cash position.
Thus, at any time during the game, each team can
compare its cash status to that of all the other teams.
This competition really motivates a number of teams.
Many students get addicted to the game and spend a
lot of time checking how they are doing against the
competition. On a number of occasions, students have
told me that the competition drove them to make
decisions that they would have not made otherwise.
Littlefield Technologies has two main assignments:
Capacity Management and Customer Responsiveness. In addition, there are several variations of each
of these two games to choose from. I run Capacity
Management first, after covering forecasting, capacity
management and queuing. Several weeks later, I run
Customer Responsiveness, after covering inventory
management concepts such as the economic order
quantity (EOQ), safety stocks, re-order point, lot sizes,
and set-up times.
I have used Littlefield Technologies in both my
undergraduate and MBA operations management
courses. Overall, I have used it in three undergraduate
classes with a total of 150 students and in one MBA
class with 40 students. I run the same Capacity Management game for both the undergraduate and MBA
classes, but for the Customer Responsiveness game
I run a less complex version for the undergraduate
students.
One of the challenges of teaching operations management is getting students to think beyond the formulas to solve real-world problems. Simulation games
can be very helpful in getting students to think
through problems in an environment with complexity,
uncertainty, and constraints. However, for a simulation game to be effective, it must illustrate specific
class concepts, provide an appropriate level of complexity and be user friendly.
This paper reviews Littlefield Technologies, a webbased simulation game where student teams manage
a factory. I have found that Littlefield Technologies is
an effective teaching tool that the students seem to
really enjoy. What I really like about Littlefield Technologies is that the simulation games are strongly
linked to class concepts—the students are forced to
think logically about the problems that they are facing
and they learn from iterative experimentation. This
experimentation is in contrast to homework problems,
where I often see students plugging numbers into formulas without really understanding the problem.
For the simulation, the students group themselves
into teams of three to four and each team receives
its own factory to manage for a period of time, typically one to two weeks. The students are told that
the objective of the game is to maximize the cash
generated by the factory over the product lifetime.
The factory assembles digital satellite system receivers
from kits of components which are purchased from
a single supplier. The assembly process consists of
four steps that are carried out at three workstations.
At Station 1, components are mounted and soldered
onto PC boards. At Station 2, the boards are tested.
At Station 3, the components are tuned. Finally, in
the fourth step, the boards go back to Station 2 for
final testing. Figure 1 illustrates the factory layout as
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INFORMS Transactions on Education 5(2), pp. 80–83, © 2005 INFORMS
Figure 1
1.
Capacity Management Game
In the Capacity Management game, students can buy
and sell machines at each of the three workstations.
They can also change the way Station 2 (the testing
station) is scheduled. They can choose first-in-firstout (FIFO), give priority to step 2 or give priority to
step 4. The purpose of this assignment is for students
to utilize queuing concepts and forecasting methods
to manage capacity. This game takes 7 days.
In the simulation, customer demand is random and
the students are told that demand is expected to grow
at a linear rate for the first several months, stabilize,
and then decline at roughly a linear rate. Customer
orders that are not filled within the quoted lead time
incur a late penalty. If the order is too late, then it
will not generate any revenue. When the game begins
there are 50 days of history and Station 1 is already
near 100 percent utilization. Thus, the students are
faced with a tradeoff between capacity and waiting
time. They can buy machines to reduce waiting time
in order to meet the quoted lead time; however, they
don’t want to buy too many machines because the
machines are expensive.
I find that most students figure out that there is a
tradeoff between capacity and waiting time. However,
many teams wait until the lead times become so long
that they are making little or no revenue before they
buy machines. Since these reactive teams generally do
not do as well as proactive teams, students learn that
it is better to extrapolate station utilization by forecasting demand in order to determine when utilization will approach 100%. In my MBA class, I found
that several teams went a step further by estimating
the amount of cash that would be lost to delays if they
did not purchase a machine and comparing this lost
revenue to the cost of a new machine. These teams
found that it was better to accept some lost revenue
during the peak months of demand rather than buy
another machine.
2.
Customer Responsiveness Game
In the Customer Responsiveness game that I run
in the MBA class, students make capacity and
scheduling decisions as they did in the Capacity Management game. In addition, students make inventory
and lot sizing decisions, choose between three customer contracts, and are extended a line of credit
from which they can borrow money. The purpose of
this assignment is for students to manage inventory,
capacity and cash in order to maximize their cash
position at the end of the game. This game takes
14 days.
In the simulation, customer demand is random and
the students are told that the average demand will
not change over the product’s lifetime. The students
can charge more if they are willing to quote shorter
lead times. As a result, the students want to reduce
the time that it takes to get orders through the factory.
The most obvious way to reduce the lead time is
to buy more machines; however, when the students
begin the game they face a cash constraint that prevents them from purchasing the machines that they
need to meet the lead time requirements for the most
lucrative contract.
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This game enables students to gain a better understanding of the behavior of production systems. Many
students realize through experimentation that their
actions sometimes result in outcomes different from
what they expected. For example, since their cash
position at the beginning of the game limits them
from buying capacity, many teams first experiment
with reducing the lot size to try to get orders through
the factory faster. However, students find that setup
times are so significant that smaller lot sizes cause
queuing problems at stations 1 and 3, resulting in
even longer lead times.
In addition, this game enables students to apply
course material in an environment that is somewhat
representative of a real situation. For example, since
there are setup and inventory holding costs, some
teams calculate the economic order quantity (EOQ).
However, these teams find that the EOQ is so large
that implementation of it at the beginning of the
game will significantly deplete their cash. Since they
are trying to build up cash to buy machines, most
teams who calculate the EOQ conclude that it doesn’t
make sense to implement the EOQ until more cash is
generated.
It is possible for teams to go bankrupt; however,
a line of credit becomes available to all teams after a
certain period of time, enabling the bankrupt teams
to borrow money and get back in the game.
3.
Customer Responsiveness Game
(Undergraduate Version)
The Customer Responsiveness game that I run in the
undergraduate class is a simplified version of the
Customer Responsiveness game discussed above.
The undergraduate version starts with a large cash
position, does not offer a line of credit, and does not
allow modification of the lot size. As a result, this
game focuses on managing capacity and inventory.
This game takes 7 days.
I have found that the undergraduate students
tend to perform less quantitative analysis than the
MBA students. The undergraduates tend to rely more
on experimentation—they make decisions, observe
the effects of their decisions, and then adjust their
decisions. Although it would be better if they used
more quantitative analysis to help in their decision
making, I find that this game is a wonderful way
to get them to think through problems logically.
For example, at the beginning of the simulation the
reorder point (ROP) is set low, resulting in stock outs.
Most teams recognize that the ROP needs to at least
cover the expected demand over the lead time. Furthermore some of these groups will recognize that
since there is uncertainty, it makes sense to add safety
stock. Other groups do not immediately see the need
Table 1
Average score
These games contributed to my understanding of
capacity management and inventory management.
In these games, I frequently found myself actively
thinking about the simulation game and what
decisions I should make.
As a result of these simulation games, my interest and
curiosity about operations management has
increased.
4.1
4.2
3.9
for safety stock; however they observe that they occasionally stock out and this observation gets them to
adjust their ROP to include some safety stock.
4.
Grading and Post-Review
5.
Student Evaluations
6.
Instructor Work Load
For each of the two simulations, each team is required
to write up a report that summarizes the actions that
they took during the simulation, why they took those
actions, and, in retrospect, whether or not they did
the right thing. I base their grade on their ability to
effectively explain what they did and why and the
quality of their analysis. For teams that finish at the
top of the standings, I give bonus points. Although
I do not penalize teams for performing poorly in the
standings, not surprisingly, there tends to be a correlation between the quality of the analysis and the
final standings.
On the day that the reports are due, I facilitate a
20 to 30 minute discussion of the simulation. I will
ask for volunteers to share what they did during the
simulation and why they took those actions. I wrap
up with a discussion on the key learnings from the
simulation.
In two of my undergraduate classes I have conducted student evaluations of Littlefield Technologies.
The students were asked to indicate how strongly
they agreed with three statements with 5 representing
“strongly agree” and 1 representing “strongly disagree.” The three statements and the average results
of 67 evaluations are listed in the following table.
The students were also given the opportunity to
write comments. Most comments were positive about
their experience with the simulations. Some of the students use the word “fun” to describe their experience
with the game. A few students criticized the cost of
the game, which is $20 per student. (Littlefield Technologies charges $15 and the campus bookstore marks
it up to $20.)
I have found the work load for running these simulation games to be very reasonable. The software
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INFORMS Transactions on Education 5(2), pp. 80–83, © 2005 INFORMS
that runs Littlefield Technologies resides on a central
server at the company Responsive Learning Technologies so instructors don’t need to worry about software
installation, maintenance, or platform compatibility.
Students access the simulation via the Internet and
I have not yet had a single complaint from students
about access problems. Also, by using the assignments that have already been created, the instructor
doesn’t have to worry about creating and debugging
assignments.
There is some administrative work prior to the start
of the first simulation. The instructor needs to make
sure that the student teams register for the game by
the time the simulation starts; otherwise, they will not
be able to play the game. The registration is webbased and students need to enter an access code that
they get for their $20 fee. In order to motivate students to register on time, I tell them that registration
is due by a certain date (a couple days before the start
of the simulation) and that it is worth one point of
the ten point assignment.
The most time consuming part of this assignment
for me was grading the reports. Last semester I had
40 undergraduate teams, and I spent many hours
grading reports.
7.
Summary
To summarize, I find Littlefield Technologies an excellent simulation game for both undergraduate
and MBA operations management courses. Students
are forced to think logically about the problems
that they are facing, they can apply class concepts and they learn from iterative experimentation.
In addition, most of the students seem to really
enjoy it.
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To reference this paper, please use:
Miyaoka, J. (2005), “Making Operations Management Fun: Littlefield Technologies,” INFORMS Transactions on Education, Vol. 5,
No 2, http://archive.ite.journal.informs.org/Vol5No2/Miyaoka/.