Using arena to teach management concepts by creating business models

An experiment was conducted in the Management Department at GMI which involved teaching management concepts by creating business models. There are several reasons that this approach has proven to be superior to the previous “straight” approach. Some of the reasons are as follows: 1. a. traditional old-fashioned push-type repetitive models of discrete parts manufacturing donʹt represent todayʹs reality 2. b. the missing dimension is “information”, which often runs in a backward flow, opposing the usual forward flow of manufacturing entities as parts produced 3. c. Arena nicely permits creating the required model, which uses a much more “open” structure, where documents represent information, and documents must be “matched” before money changes hands, and 4. d. Arena is one of the best contemporary simulation tools that can be a simulator at the highest level of abstraction and still handle the fine detail at the lowest level of abstraction. This paper describes some of the lessons learned in two semester of this experiment. Several models are described in the paper. For example, one key lesson learned was demonstrating how the key document in the Procurement process is the Purchase Order (i.e., PO), which permitted us to span a very wide range of Management concepts.