Presentation - Western Research Application Center

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A Collaborative Manufacturing

Collective

Ken Dozier & David Chang

Western Research Application Center

HICSS 2015

Knowledge Systems Track

January 7, 2015

Kaua’i Hawaii

Western Research Application Center (WESRAC)

Dr. David Chang

Semiotics, Syntax & Plasma Physics

Western Research Application Center (WESRAC)

Introduction

• Used a Design Research Framework to create a

Learning Object Game Immersed in Complex

Systems (LOGICS) process and product artifact.

• Used the NetLogo “ Hubnet ” capability to immerse a human agents into the simulate the dynamics of the classic Sterman “ Beer Game ” .

• Create a persuasive experience that nudged players abandon heuristics and invest in IT rationality to improve economic performance in a counter-intuitive dynamic business system.

Western Research Application Center (WESRAC)

Background

Observations

– Cyclic phenomena in complex dynamic business systems

• Ubiquitous & Disruptive

• Wild oscillations in supply chain inventories

Results of Observations and Simulations

– Negative Feedback Systems with Delays Oscillate

– Phase dependence of oscillations on position in chain

– Understanding of Managements Personality Impact

– Commitment to Rationality Dramatically Increases Financial

Performance

MIT Sterman “

Beer Game ” Simulation

– Single Customer, Single Product, 4 Tier Supply Chain

– Published Suboptimal Performance 1 Order of Magnitude

– Experimental Suboptimal Performance 2 Orders of Magnitude

Western Research Application Center (WESRAC)

Beer Game

23 rd Order Differential Equation

Model Developed by Dr. Nathan B. Forrester of A.T. Kearney, Atlanta, 2000

Western Research Application Center (WESRAC)

Sterman’s Single Repetition

Teaching Takes Off: Flight Simulators for Management Education, Sterman (1992)

Western Research Application Center (WESRAC)

Steady state at 4 cases per order.

Wilensky, U. (1999). NetLogo. http://ccl.northwestern.edu/netlogo

. Center for Connected Learning and Computer-Based Modeling.

Northwestern University,

Evanston, IL

NetLogo Demonstration

Beer Game Demo Densmore, O. June 2004

Western Research Application Center (WESRAC)

A Single Change

A 4 Unit

Constant

Demand is

Changed to an 8

Unit Constant

Demand

Wilensky, U. (1999). NetLogo. http://ccl.northwestern.edu/netlogo.

Center for Connected Learning and

Computer-Based Modeling.

Northwestern University, Evanston, IL

Beer Game Demo Densmore, O. June 2004

Western Research Application Center (WESRAC)

Analytical Models

Direction

Cooperation

Efficiency Proficiency

Competition

Concentration

Innovation

Source: “ The Effective Organization: Forces and Form ” ,

Sloan Management Review, Henry Mintzberg, McGill University 1991

Western Research Application Center (WESRAC)

Conflicting Temporal Layers

Source: Gus Koehler, University of Southern California

Department of Policy and Planning, 2002

Western Research Application Center (WESRAC)

Layers of Communication

Source: Gus Koehler, University of Southern California

Department of Policy and Planning, 2002

Western Research Application Center (WESRAC)

Government Dynamics

Source: Gus Koehler, University of Southern California

Department of Policy and Planning, 2002

Western Research Application Center (WESRAC)

High Level of Complexity

Source: Gus Koehler, University of Southern California

Department of Policy and Planning, 2002

Western Research Application Center (WESRAC)

Low β

Bureaucratic Factor

Market Redefinition

Supply-chain Expansion

Supply-chain Discovery

Business Model Redefinition

Business Model Refinement

Business Process Redesign

Business Process Improvement

High β

Western Research Application Center (WESRAC)

Seven Organizational Change Propositions Framework,

“ Framing the Domains of IT Management ” Zmud 2002

Plasma Theories

• Advanced plasma theories are extremely important when one tries to explain the various waves and instabilities found in the plasma environment.

• Since plasma consist of a very large number of interacting particles, in order to provide a macroscopic description of plasma phenomena it is appropriate to adopt a statistical approach.

• This leads to a great reduction in the amount of information to be handled.

• In the kinetic theory it is necessary to know only the distribution function for the system of particles.

Source: University of Oulu, FInland

Western Research Application Center (WESRAC)

Previous Publications

• Investigated the β bureaucratic factor and it ’ s inverse organizational temperature T (dispersion) in the 5 metropolitan service areas surrounding Los Angeles.

• Investigated the ability of Stratification to Differentiate impact of IT Investment on output and job creation

– Large firms invest in IT to increase output and eliminate jobs

– Small firms invest in IT to increase output and expand workforce

• Investigate Partition Function Z, Cumulative Distribution

Function opened the linkage to Statistical Physics

– Dozier-Chang (06) Journal of Information Technology Theory and

Application

• Math Intensive Solution Ideal for Cloud Architectures

– Marginal Cost on a per transaction basis

– “

Give them a Browser (Razor), sell them Transaction (Blades)

– Accommodates Both Large and Small Firms

Western Research Application Center (WESRAC)

Maxwell-Boltzmann Distribution

Comparison of U.S. economic census cumulative number of companies vs shipments/company (blue diamond points) in Los Angeles County Metropolitan

Service Area in 1992 and the statistical physics cumulative distribution curve

(square pink points) with β = 0.167 per $106

4000

3500

3000

2500

2000

1500

1000

500

0

0 10 20 30 40 50 60

Western Research Application Center (WESRAC)

Advantages

• This model does allow examination of the optimal timing for interventions of these propagations and parametric forces. Something not possible in simulation models to date

• The most effective paramedic interventions will be those that use information technologies to harmonize with naturally occurring Normal

Modes of the system.

• Disturbances from non optimal interventions move up and down the supply chain.

Western Research Application Center (WESRAC)

Learning Object Game

Design Science

Framework

Takeda, Veerkamp,

Tomiyama, Yoshikawa (AI)

Purao (IS&T)

Dasgupta (IS&T)

Vaishnavi & Kuechler, Design Science Research Methods and Patterns (2008)

Western Research Application Center (WESRAC)

Kernel Theories

Western Research Application Center (WESRAC)

Integrated Development Environment

LOGICS

Behavior Space

Generator

Participatory ABMS Analysis Space

Western Research Application Center (WESRAC)

Player Interface

Western Research Application Center (WESRAC)

Instructor’s Console

Western Research Application Center (WESRAC)

Results of Five Designs

(measuring total system cost)

Western Research Application Center (WESRAC)

Design 1 vs. Design 5

Design 1 Normally Distributed

Western Research Application Center (WESRAC)

Design 5 Highly Skewed

Design 5 Data

Trial Player 1 Player 2 Player 3

1 4356 15588 6243

2 4362 4289 16650

3 3393 8156 5840

4 1563 1491

5 2885 1876

Total

System

Cost per

Trial

HPC Orders 21% 55%

Western Research Application Center (WESRAC)

Binomial Distribution

5000

4000

3000

2000

1000

0

0

Results can be interpreted in a self consistent manner since each trial can be considered independent.

A “ success ” occurs when the total cost is less that some target

Binomial Distribution is Appropriate for a Modest Sample Size

There is a 7 fold improvement in target teaching costs in only five trials

This is a dramatic improvement in past experience with reinforced learning for the Beer

Game problem

6000

Teaching Target Costs from Box Plots

N=3 p=1/7

1 2 3

Trial number

4 5 6

Western Research Application Center (WESRAC)

Someone is Getting Rich on the Waste

Western Research Application Center (WESRAC)

Findings

• Game 1: Manual ordering with repetition. Control group average 10 times larger than Sterman.

• Game 2: Manual ordering using Senge ’ s “ Do nothing strategy ” Retail absorbs the bulk of the costs

• Game 3: Local computing enables Wal-Mart's to kill supplier factories

• Game 4: Any technical solution is better than intuition

• Game 5: If we cooperate we make 100 times more money

• The Optimal to Average performance ratio of 100 to 1

Western Research Application Center (WESRAC)

Collaborative Manufacturing

Much room for improvement

– Asynchronous interaction between tiers.

– Realistic demand time-series

– Realistic normal modes and associated optimal values

– Machine Learning Agents to be incorporated

– Cloud computing platforms for implementation of collaboration

– Approach is applicable to more complex adaptive manufacturing networks where efficiency is achieved by cloud-mediated feedback to individual firms.

Western Research Application Center (WESRAC)

Video Demo – Instructor’s Console

Western Research Application Center (WESRAC)

Contact Information

For more information, please

Visit the Learning Center

http://wesrac.usc.edu

kdozier@usc.edu

Google WESRAC

Google Ken Dozier

Western Research Application Center (WESRAC)

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