Supply Chains: A Manager's Guide

The Case for Models

A model is nothing more than a simplified representation of a real-world system. This representation can take a wide variety of forms, including verbal explanations, whiteboard diagrams, mathematical equations, physical structures, and computer programs. All these models serve a common purpose: They take a system that may be hard to understand or dangerous to manipulate, and they render it in a form that is easier to understand and safer to play with.

Models help with all three of the key business processes described in Chapter 4: understanding, prediction, and control (Figure 5.1). Building a model of a system requires that you analyze the system to identify its key components, figure out how those components work, and then ...