Teaching Lean Six Sigma Within a Supply Chain Context: The Airplane Supply Chain Simulation

Lean six sigma is a management methodology that firms can employ to achieve substantial improvement in supply chain performance. However, few pedagogical exercises facilitate students' use of a comprehensive set of lean six sigma principles within a supply chain context. We describe the Airplane Supply Chain Simulation that helps students understand how lean six sigma concepts may be leveraged to improve supply chain performance. The basis of this simulation is a four-tier supply chain, consisting of suppliers (two tiers), a manufacturer, and a customer, that produces three models of paper airplanes to meet randomly distributed customer demand. In the first of three successive runs, a highly structured simulation is executed in which supply chain roles are well defined, material flows are convoluted, and a "push" production strategy is followed. The first simulation as the "current state" and, for the second and third simulation runs, challenge competing student teams to leverage lean six sigma concepts to develop a "future state" that enables the fulfillment of all customer orders at the lowest cost. Results based on statistical analyses of survey response data from 194 MBA students show that the Airplane Supply Chain Simulation is an effective participative, team-based learning tool.