A big THANKS to BILL FARMER for facilitating THE BEER GAME and to the IGNITE AGILITY meetup for co-sponsoring the event and providing the venue. It was AWESOME to gather together to game in-person after all these months apart.
THE BEER GAME is a simulation that has existed for decades and used in Ivy League classrooms and corporate board rooms alike to teach participants the basics of Systems Thinking. Additionally, it’s referenced in the classic business book, The Fifth Discipline by Peter Senge. In the game, the participants are in groups of 4 with each participant taking on one of four roles in a beer supply chain:
- Factory
- Distributor
- Wholesalers
- Retailer
The game is played in rounds with each round consisting of the following steps:
- Check deliveries (or incoming production in the case of the Factory)
- Check incoming orders (from the downstream player, or from customer orders in the case of the Retailer)
- Ship/Deliver Beer (shifting inventory through the supply chain to represent passage of time and delays in the supply chain)
- Place outgoing order (to the upstream player, or to the production line in the case of the Factory)
As the game progresses, each player rapidly gets either behind on their orders or excessively overstocked in their inventory (or both). At the end, the group recaps what happened and the details of the system are revealed to help everyone see where the issues arise.
This was a TON of fun and caused a lot of thinking about how the information delays in the system resulted in bad assumptions and ultimately bad business decisions. If the system had been redesigned, it likely would have resulted in more efficient operations for all individuals.
If you’re interested in reading more, check out this article.