Engine - Production Management
The game models the operation of a company producing and selling engines for electric vehicles. The company is part of an international group, but it is an independent economic unit responsible for its successful operation and decision-making. The engines are purchased by automotive companies all around the world, which are also owned by the group.
This creates, of course, a kind of security in sales, but it also limits the variety of trading conditions. The situation of the world economy is good, car purchases (which ultimately determine the demand for engines) are increasing worldwide, which means a good market for the customers of the company, the automotive companies assembling cars. The students can also buy spectacular demand forecast charts.
The country in which the factory operates is an average economically developed country. The company operates in a customs-free zone, all accounts are recorded in an international currency unit called World Currency Unit (WCU). The game also consists of interesting projects, like administration and warehousing services, outsourcing of the IT system, the introduction of the just-in-time inventory management system, etc.
How the Engine simulation software works:
The students can individually or in groups take over the management of the virtual company created by the simulation software.
The virtual company is managed by making annual strategic decisions. The software gives written feedback about the results of the decisions, and it also shows the important economic indicators (profit, cash flow, turnover) on a graph.
The software settings can be modified in various ways based on different demands, purchase prices, credit conditions and a number of other factors.
The software can simulate up to 8 periods, so 8 virtual years.
The decisions:
Production: The most important area of the game. Setting of production factors, such as raw material, workers, machines, as well as the plant, setting the number of shifts/overtime.
HR: Human resources are indispensable for the operation of the company, you have to make separate strategic decisions for production workers, engineers, logisticians and researchers.
Investment: In order to be able to produce the right amount and quality of products, we need the right technical background. We can ensure this by precisely planning real estate, technical equipment, vehicles and warehouses. In this area, it is possible to invest as well as to rent, it is up to the players to decide which option to use and to what extent.
R&D: Research and development are essential in the life of a manufacturing company, which is why we place great emphasis on this in the simulation as well. Quality factors: Average quality of raw material, engineer's training, R+D level.
Finances: Credit decisions necessary to finance the operation, in order to ensure liquidity, it is possible to take out 3 different loan products.
Projects: By launching these, you can specialize and modernize your company in order to operate more efficiently. You can currently choose from 8 projects.
Advantages and learning points:
The program provides an opportunity for the players of the simulation to put their basic knowledge in production management to the test, and gain an insight into the strategic questions of production and management.
The structure of the program helps in synthesizing the knowledge of the students studying economics/technology, and in putting it into practice.
Engine requires the proper operation of a number of factors, which characterizes the real world in general. Careful planning is essential to be successful in this simulation.
The game challenges and develops analytical skills, as students are required to find the data they need from various financial, production and sales reports (for example balance sheets, income statements, cash flow, market research forecast).
As a result, just like in real life, effective teamwork is essential to successfully complete the game.
References:
Budapest University of Technology
Sapientia Hungarian University of Transylvania
Universidad del Istmo (Guatemala)
The program has already proven its effectiveness in ALTEO Energy Challenge student competition.