The Palm Oil Trade-Off Drives This Sustainable Supply Chain Simulation

When the Indian School of Business set out to help its faculty build experiential teaching tools, two groups arrived with developed ideas. One became the Sustainable Supply Chain Simulation, created in collaboration with Sim Institute and built on Forio’s Epicenter platform. The result is a learning experience that asks a question textbooks rarely let learners answer for themselves: can a company source responsibly and still make money?

In a conversation about the simulation’s design, Tim Rogmans, Managing Director of Sim Institute, traced the partnership back about 15 months. The Indian School of Business brought the operations expertise and the concept. The collaboration paired two strengths around a topic both saw as strategically urgent.

The Problem: Sustainability Taught as an Afterthought

Open any current operations management textbook and sustainability is everywhere, in a standalone chapter or threaded throughout. The question of how to make a supply chain sustainable has become central to many aspects of business. But reading about a concept and living it are different things.

“If you tell people you need to be sustainable, they will remember it for the purposes of the course and then forget about it the next day,” Rogmans says. “But if they have gone through the simulation, they played it, and they said, ‘Hey, I introduced these refillable bottles and then I got a lot more customers,’ then it all comes more alive.”

That gap between knowing and experiencing is what the simulation was built to close.

Why Palm Oil Anchors the Supply ChainSimulation Story

The storyline puts learners in the role of a supply chain manager at a multinational company that makes personal care products: liquid soaps, shampoos, conditioners, shower gels. Over five simulated years, they make decisions across the supply chain that shape the company’s sustainability, quality, and financial results.

At the core sits a real and recognizable dilemma: palm oil. Palm oil is in everything from soap to packaged food, and the scale of its cultivation has reshaped landscapes across Southeast Asia — the area planted globally grew nearly tenfold between 1970 and 2020, from 3 million to close to 30 million hectares (WWL).

The damage runs past the forest itself, Rogmans noted, saying it's the surrounding wildlife that loses habitat as plantations expand. Oil palm expansion could affect 54% of all threatened mammals and 64% of all threatened birds worldwide (IUCN). And the climate cost is concentrated in a way that makes the sourcing decision sharper than it first appears. In Indonesia, though only 14% of palm oil plantations sit on carbon-rich peatlands, drainage and fires on those peatlands caused nearly 92% of the sector’s greenhouse gas emissions between 2015 and 2022 (SEI). Where you plant matters more than how much.

That last point is the exact kind of trade-off the simulation was designed to surface. It also sets up the central tension Rogmans wanted learners to grapple with: the familiar anti-sustainability argument that doing things differently costs more. “The challenge is how you can do it differently without raising your costs too much, and how you can provide extra value to customers, so that maybe they’re willing to pay a bit more, or you can sell larger volumes. So there’s still this business case for a sustainable supply chain.”

Sustainability Decisions Don’t Stop at Procurement

What sets this simulation apart is breadth. It’s holistic by design: rather than drilling a single operations concept, it integrates many supply chain topics into one connected system.

“Within the boundaries of supply chain and operations, it’s very holistic,” Rogmans says. “It covers every step in the supply chain. It’s not just one lesson.”

The decisions reflect that scope. Learners make company-wide choices — whether to recruit a sustainability officer, whether to carry climate risk insurance — then move through three sequential stages: procurement, production, and logistics. Each stage carries its own set of choices. Responsible sourcing runs throughout, including labor practices, a dimension consumers increasingly scrutinize.

“When I buy my furniture or I buy my soap, is there any clear indication that there’s no child labor involved or human rights abuses?” Rogmans says. “That brings the supply chain more into the forefront.”

It also reframes who should care about sourcing. A marketing or finance professional might assume supply chain ethics are someone else’s concern, until a company lands in the news for poor practices and customers respond at the register and public social media posts.

Where the Math Ends and Behavior Begins

Building a simulation this integrated meant managing complexity carefully. “These are iterative processes, step by step, and it gets more complex and rich over time,” Rogmans says. “But then you don’t want to overdo the complexity either.”

The trickier design questions involved human behavior. Some outcomes can be calculated cleanly. Others, like how much consumers actually reward sustainable choices, are less predictable. Two decisions in the simulation hinge on that consumer response: substituting alternative oils for palm oil, and introducing refillable bottles as packaging. Both required grounding in research rather than tidy formulas.

The payoff is a simulation that’s rich but navigable. “People don’t get lost,” Rogmans says. “It’s got a lot of content, but it’s really easy to figure out what you need to do. Making the right decision maybe is not so easy, but the rules of the game are clear.”

From Cost Center to Business Case: Changing Minds About Sustainability's Bottom Line

Rogmans describes a recurring reaction from learners and facilitators alike. Many arrive convinced sustainability is purely a cost. “The people who have that view will be very difficult to convince of anything else,” he says. “But by playing the simulation, using assumptions that you can test and challenge, people see — no, actually there is a business case for supply chain sustainability.”

The team tested the simulation across different class settings before release. Learners responded well to playing it in teams, where the trade-offs become material for genuine debate — the kind of shared, experiential change management that shifts a group's thinking together. “They enjoy it as a team exercise, because they make real trade-offs and face real dilemmas, so they benefit from discussing this within their teams.”

How AI Deepens the Learning

When facilitators enable it, the simulation invites learners to record the reasoning behind key decisions and receive constructive AI-generated feedback in the dashboard. The feature serves two purposes: it pushes learners to articulate and interpret their own thinking, and it gives facilitators visibility into the process.

“Imagine somebody makes a bunch of good decisions, but it’s all luck — they don’t know what they’re doing,” Rogmans says. “By inviting people to submit their reasoning and giving AI feedback on it, you have more transparency and better learning.”

Why This Sustainable Supply Chain Story Matters Now

The strongest argument for teaching supply chain sustainability this way is the one the numbers make on their own. The palm oil sector alone illustrates how a single sourcing category carries deforestation, biodiversity, and climate consequences at once. In Indonesia, industrial palm oil production emitted an annual average of 220 million tonnes of CO2 equivalent between 2015 and 2022, close to one-fifth of the country’s total emissions (SEI). A learner who has run those trade-offs inside a simulation reads a headline like that differently than one who memorized a definition.

That’s the mindset shift the simulation was designed to produce. Its lesson rejects a one-line summary, which is the point. There’s no single trick to master. “It’s a system,” Rogmans says. “You take a holistic view, you analyze the information, including the news items, and you discuss it.”

For buyers deciding how to teach sustainable supply chain management with more staying power than a lecture, that system view is the draw. Learners leave having run the trade-offs themselves and seen, on their own dashboard, that responsible choices and business results can move together.