Economics
MIT’s ‘Beer Game’ Shows Humans Are Weakest Link in Supply Chains
MBA students are taught to suppress their panic-buying impulses in order to come out on top.
Illustration: Thomas Colligan for Bloomberg Businessweek
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Prospects that the world’s snarled supply chains may become less tangled were dealt a setback last month when a couple of MIT students bought 10,000 cases of beer.
The purchase order wasn’t real. It was part of a role-playing exercise called the Beer Game that’s something of a rite of passage for first-year MBA students at the prestigious Sloan School of Management. Created in the 1960s, it models the supply-and-demand dynamics among a brewery, distributor, wholesaler, and retailer. At the Sept. 24 game, held at a Marriott in Cambridge, Mass., Team Bemba got nervous, made the big buy, and amassed $213,000 in make-believe carrying costs.