This paper discusses the introduction of system dynamics modeling and scenario planning into the planning process at Chevron. These techniques can help planners by providing an integrated, quantitative perspective, filling a gap between the detailed micro-analysis of spreadsheets and the holistic, but static forms of decision analysis. Specifically, system dynamics simulations can help planners to manage uncertainty and view the consequences of investment decisions in alternative futures. In this paper we discuss lessons learned from the creation of a pilot simulation focused on gas asset management in Chevron's Nigeria operations. We briefly look at the process by which ...

Offshoring is a mistake when technology companies confuse operational effectiveness and strategy. Operational effectiveness is about working cheaper or faster. Strategy is about the creation of a long-term competitive advantage, which for technology companies is usually the ability to create innovative software. Outsourcing programmers works when the software developed isn’t a key part of the pipeline of innovation for products a company actually sells. For example, when website design or back-office software such as payroll or inventory control is outsourced, that can be good because it improves operational effectiveness. But writing innovative software cannot be done on an assembly line. ...

The aftermarket business strategy was conceived in 1906 by King C. Gillette to sell safety razors and blades. It was Gillette’s idea to "give the razors away, but charge whatever traffic will bear for the blades." Gillette’s aftermarket strategy and his safety razor patent made him a millionaire and the strategy, which became known as the "razors and blades business model," is still successfully used by the Gillette Corporation nearly 100 years later. Today the aftermarket strategy is used by a variety of businesses. Aftermarket sales often eclipse primary product sales for both profit and revenue generated. For example, 75% of ...

Typically, a business simulation is just one part of a complete e-learning program or workshop. Preparation, summarization, and testing are essential to help learners interpret and structure their experiences from the simulation. There are different simulation learning sequences that can be built to achieve these objectives: classic, knowledge-paced, and exploratory.

A few weeks ago I was watching my 5 month old son, Jonah, lie on his belly and reach for a colored block just out of reach to his right. He reached for the block and kicked his legs, successfully moving sideways a small amount, but unfortunately away from the block. He kicked and rotated another inch, again in the wrong direction. With an intent look on his face, Jonah kept straining to reach that block, moving a little more away from it each time. This affair reached its logical conclusion 10 ...