 Welkom bij de masterclass, een groot naam voor een model woord, voor een supply chain dynamics, als een voorbeeld van wat het is dat ik zal worden geofferd in de... of dat ik zal worden gehaald om te digesteren in de informatiemanagementmaster. Mijn naam is Henk Ackermals, ik ga een beetje de eerste introductie later op tijdens mijn slijtjes. Ik zal je een pre-warning geven, het mag niet starten meteen als iets wat je verwacht te krijgen in informatiemanagement, dus het kan meer als iets in een MBA-cours, maar we gaan er dan. Ik begin met ASML. ASML is een van de betere, koudige hi-tech giants in Nederland. En dit is vanaf 2001, toen ik nog een assistente professor was in Eindhoven, een universitele technologie waar er een dichtere connectie is met ASML, er hebben er wat studenten daar. En wat je hier ziet, is een performance graf, zoals we in informatiemanagement willen. Wat je hier ziet voor ASML, en voor die die die dat niet, is ASML is een company dat maakt equipment waar je chips kan maken, waar je integratiecircuits kan maken, ICs. En als zo, zijn er al de weg in de hele business-value chain van de iPhone die ik heb, die heeft chips gecontainmenterd, die worden gemaakt door companies, zoals Intel of zoiets, en ze gebruiken machines, waar sommige van die zijn gemaakt door ASML. Waybank 2000, 2001, en 2000, de wereld was goed voor ASML. De blauwe lijnen zijn de machines die ze schipten. Dit is wereldwijd, by the way. Dit is niet ASML-specific data. Ik heb die, maar ik kan ze niet shareen met je. Maar dit is een verkeer, dit is een publieke materiaal. De groen lijnen zijn de boeken. Dus je ziet, wonderful years. 2000 was een wonderful year. Ik weet dat ik aan dat moment was, aan ASML, en ze waren bezig, zoals helden. Dus in de start van sommige van 1999, en ik heb hier een paar kwotsen van de Dow Jones, van de, wat het nu is, de Wall Street Journal. Sommige in 2000, wat ze de boek-to-bill ratio konden, die de totale aantal nieuwe auto's komen in, divideerd door de totale aantal auto's, eigenlijk gechipd, dropt onder 1. En in dat geval, dat betekent dat eigenlijk, de deel van werk die je hebt in de company, de auto-boek is schrijven, wat vaak suggestiefs dat de taai is gehaald, want als je in een cycle, je zet meer tomorrow dan vandaag, dan zal de auto-boek worden groeien. Nu is het schrijven. Het was partelijk, maar het was een klein blip. En de mensen in de Philips semi-contacties, die ze ook op dat moment werkten, ze ontwikkeld. Zeer suppliers, ASML, niet ontwikkeld. Ze geloven echt dat deze goede tijd omhoog zou zijn. We gaan continu. In januari, het voeltje, de moed was nog heel optimistisch, en inderdaad, als je kijkt naar de officieel repos, de dingen die je kunt readen in de nieuws, ASML was beter dan iedereen geloven. Altho, een van de goede tijds may have already been somewhat over. We didn't know that. En dan, oh, one of the quotes here by Doug Dunn, the CEO of ASML said at that time, well, there are some customers, three to four have asked us to delay shipments to the second half of the year, but still we're fine. That's January. In March, the stock market crashed. And shortly after that, on March 16, ASML had lowered forecasts. And we're around in this period now. But still lower forecast, not good news for this stock market. Bang! Just in July, it predicts a loss, where this was a record top year at the U.S. revenue drop shortly. So they weren't selling any more to U.S. customers. En in oktober 2016, they actually had to fire some 1,400 people. That sounds like a modest job. It's still 1,400 too many. But you have to recognize that ASML, of the total product, they make 5%, 2%. So if ASML fires 1,000 people, it means some 20,000 jobs are lost in the whole supply base. Which mostly is also in the Netherlands and in this area. So this was a big loss for the region. If you still hear people talking about how wonderful the Eindhoven region has its axe together, then please remember that 10 years ago they were in deep shit. And that, and you would say, you might argue, hey, how could that happen? In supply chain management, often we talk about 10% more, 10% less. We talk about from here to here, from say this period here, of what is it, 150, up to here 500. So that's easily 300% more. And from the 300 back to here, 50, well 80% less. So really big swings. Ok, that's ASML. Just one example. I'll give you two more. This is the Airbus A380. The biggest commercial plane that flies nowadays. Originally thought of in 2000. Again a graph in the time, what you see here in the graph is a total, the cumulative number of orders for that very big plane. So thought of in 2000. Launched as a program. In the beginning of 2000, around 2004, internally there were signs of delays. Delays because this making of a plane is not just a big plane, it's also a very big project. Technical problems, because it's horribly complex. Just to give one non-trivial example, the amount of cables. Does anyone have any, how many meters of cable go into an A380 airplane? 200 kilometers. But 20 kilometers sounds already crazy. 200 kilometers of cable in one plane. So that's a crazy amount. And that's just the easiest part, you would say, of designing a plane is the cabling. I mean it also has to fly and the engines and the avionics, et cetera. So that was in 2004. In 2005, actually the first A380 was shown to the public. And the one flew, the first plane also flew from Paris to New York. I remember I taught the class beginning 2007 here to kids. We have a kids university initiative and they gave this example. And some kids in the audience said, no sir, that's not true. Because I've seen on the Yogynail that there was an A380 flying and said that's true, but there was only one. Because the problem is, they couldn't make more. They could make one, hand stitched as an expensive shoe, but they couldn't get the industrial process going. We had to do that in 2004 in die van die plaats. We had to create something like a purvere plane. We had to do something like we had to do something like a TV stand-up or something like that for the planes. We had to create a bus in the French-inspirentise of a platform of a cabling in a... In juli 2005 was de eerste geluid aangekomen, na deze geluid, in het publiek te maken, en om er veel van te maken. In 2006, nog een andere geluid, was het officieel dat ze een nieuwe geluid hadden. In juni dat er ook, als resultaat van dit, de geluid werd geplumpt. 1,25 procent, we praten van EADS, dat is een Europese giant, dat is een heel groot conglomerate. De topofficiële zou kunnen stappen. Er was een 3e geluid in oktober, en de customer begon te cancelen, 10 planeen, elk planeen, ongeveer 1,50 miljoen, dus dat is 1,5 miljoen, en inderdaad, in marge van dat jaar, EADS had de 5.000, 10.000 staff, weer met een hele host van suppliers, achter dat, dat was onderzoek met Fokker, ze supplyerden meestal de hele van de aerostructure met de heel innovatieve materiaal, ze hadden een factorie open, maar het kon niet verlezen voor een hele jaar, dat was een verdedigd jaar. Dus wat is er gebeurd hier? We hebben een extrem wel-educated company, 10.000 of 1000 mensen, veel hoogere degrees in het, ik weet niet hoeveel hadden de degree van Tilburg University, maar heel goed gepland, en ze zijn 2,5 jaar geleden, en het leek eigenlijk aan de disaster, niet alleen een maand geleden, maar al jaren geleden, en eigenlijk zouden ze het al jaren geleden hebben gezien, en het was aangebouwd, alleen 2 jaar geleden. Wat is er gebeurd daar? De laatste voorbeeld. Oh, ja, en lauze 3,5 miljoen euro los. Dit is Holland, dit is KPN, dit is internet plus bela, internet plus bela was een wonderfull, is er nog een wonderfull product, KPN was ook wonderfull, omdat de stretch van KPN was dat het kon cannibaliseren, het eigen business. Back in 2005, de cable companies were making serious strides into cutting into the telephony business of KPN. KPN, your parents and your grown-grandparents used KPN for the telephony, and of course if you want to look at the TV, you use the cable company, but with the rise of voice over internet protocol, technology by which you could use telephony over the internet protocol, customers all of a sudden could watch TV via the television, via the television. Voip services were now very common. KPN saw that, saw it happening, saw it losing customers, because it was cheaper on the other side. They could do two things, they could wait, or they could launch their own product and they did it last. There was a voice over internet, it was internet plus bela, it was a huge success. I was there again working in that area up here, and when they originally introduced the service, they sold for 500 orders a week, and on the first day they had 10,000 orders. So again, bang! Not 5% more, but 500% more. At this peak, they sold 70,000 orders in one week. Which is a wonderful success and I have the minutes of this meeting, at champagne, et cetera. Oh, we also have some problems in delivery and complaining customers. Because all those 100,000 customers, they actually sold the product, they couldn't get the product delivered to in time. It was just too complex. So the storyline here, launch of the new product, very successful sales, record sales up here in the summer of 2007, but the pipeline, so you had new orders coming in, they couldn't get them installed for you quickly enough. More and more complaints, what actually happened, in Radar, and how you call those customer programs, the KPN senior managers were asked to explain what was happening to a whole room filled without raised very angry customers and they were grilled, they were tortured on life, audience more or less. Because they simply couldn't explain what was happening, just working on it, it's difficult, et cetera. So that happened in, around the end of 2007, and top management team decided to stop entirely promotion and sales. Bang! We don't sell it, only those people who really come and ask for it, we still deliver. So again, going from 50,500 to almost 50,000 here and back. Again, hundreds of percentages, not your usual supply chain management. Official estimates of KPN, something like a hundred million of avoidable losses there. Okay. This is, these three cases are all three cases that are separate chapters in my course on supply chain dynamics. I actually have nine of those cases, which first are started with some theory chapters and then some reflection on it. And every time it's bang! That's the kind of tsunami, I call it business tsunami, aspect of supply chain, very wild fluctuations. In order to understand those, you need to understand about operation management because these are really physical supply chains so far, although, and service supply chain, but really operations about how do you actually do stuff. There's a lot of organization and management theory about these are networks. And also the toolkit, the theoretical lens through which you look at this, is system dynamics. System dynamics is a methodology derived, developed originally in the 1950s and 80s by professor J. Forster of MIT, who comes from the area of control engineering. I have the very special pleasure of visiting him once more in May this year. The man is 1960, is 96 years old. En he apologized for the fact that he couldn't receive me in his office in MIT because he's there very rarely and if I could visit him at home. So, really old stuff, wonderful stuff, but it's a methodology that allows you to model these processes, these very highly non-linear, chaotic almost processes and make simulation models out of those so that you can understand the world a bit better. Every case starts with an interview, a fireside chat recorded next to a fireside with me there, with one of the key executives. So the people who actually were running this business at the time because I was around in most of those cases I could ask them could you come and give a guest lecture but also if you can't come for the guest lecture can I ask you to give me an interview and we have those, nine of those interviews and every time there's also of course the classical text I have 420 pages of text but the most attractive thing for my students I have 180 YouTube clips which contain what my kids would call the gameplay walkthroughs so all because of all those cases I have simulations simulation models main assist dynamics that replicate the behavior in the case and you can conduct experiments with those simulation models to do better but that's often cumbersome to understand, it's technical and you have to get up and be here at 8.45 in the morning on Friday morning and see me do stuff on the computer and what was it that he precisely did et cetera and how somebody has a status update on Facebook no you can do that in the leisure of your own home you can check YouTube and see what happens there and that's the content of this course now you may ask what's the connection to information management here lots I also teach this course in the master of supply chain dynamics so in the master of supply chain management with some modifications so the link there is clear but all of this is very much also in the information management domain so first of all it is from the perspective of the managers the managers who made the decisions and they make stupid decisions fallible decisions, is that because they are stupid is it because they are bad people is it because we, you and me are better no, there is actually an entire chapter about how fallible how bad basically our dynamic decision making is we as humans are simply not good in making decisions about those complex settings we make mistakes and part of the course is to see why those mistakes are made and what you can do so it's information process the topics there is a case on an ERP implementation there is a case on a sales and operations planning implementation there is a case on a balance core card implementation there is a case on IT outsourcing a case on supply chain transparency a case on project planning all these are standard curricular topics in the for an information management course of management program but they are cast in this real world case of something that happened with the actual managers telling about it and also with simulation models describing what it actually meant if you make mistakes there thirdly our analysis this information management is in about computerized information systems or information system in two ways one we study them as a problem we study the problem of ERP implementation the problem but also our method, our analysis is often IT based we use IT tools big data decision support system simulation modeling artificial intelligence what have you to understand to make sense of the world and this course is entirely driven on making simulation models of those business settings and analyzing those simulation models fourth our learning style I often ask and I will ask this also in my course in this evening who does not know how to use bluetooth on his or her mobile phone I assume that means everybody does of everybody who has found out how bluetooth worked by studying the manual hey wow, good you are the one exception but unfortunately you are not part of the target audience anyway so most of us find out how well I can ask how did you learn how to use bluetooth yes, trial and error and then it worked who used another method of finding out how bluetooth works instruction video somewhere on the internet yeah, a youtube video how to use okay, yet another method yes, that's the third you ask somebody else anyway, so that works for you the puzzling thing to me since I've been teaching this stuff now for 15 years 14 years to be exact is that somehow those core human problem solving skills that all of you possess are lost as soon as students step into an academic room because then where is that in the book professor could you tell me explain a bit more but this course is different you have to figure out stuff yourself so there are other models there are other instruction videos and now you figure it out figure out how stuff works how do those models work you can spend, as I did, 10 years on those models you can spend 10 hours on those models and you will fail, 10 days and you will be successful 10 weeks and you can become a PhD with me so it depends on so you have to figure a lot out yourself there are those 420 pages every single equation is explained in those but you don't have to do that for my course but you can so it's very much the learning style of the engineer of the information engineering feel like in a business school in an economic school which is unusual for many of my students yes they can do that at home so it's not like the slides last years exam no you have to figure out stuff yourself it can be confusing also there are very modest hints on when you should finish something students can always come to me and ask questions and during the lectures but basically it's you it's not me standing in front of the room with you sitting in the back falling asleep and you know I went to class anyway the learning how bluetooth works approach fifth one evaluation the exam is a computer exam you run models on the computer and do analysis from that like et cetera and then a case study and MBA but in the end you have to do sensible stuff with a computer simulation model but it's about the real world not some very theoretical program last but not least what's information management about this course it's me, your teacher it's by me that's me I studied here information management and I studied Japanese in a while en I studied industrial engineering I've been working at the interface and the business I've been working for an IT a consulting firm for a long time most of my work experience most of my best references economically speaking are in the field of information management but I've also been working a lot in the business area in several of those areas industries that you find cases of that's me so everything that I do has IT, has information management in it, the style how I work so I use modelling a lot and modelling analysis but also the topics so although I not your average nerdy type I certainly do have quite some of the more computer science or management science carefully hidden behind my suit and sometimes it comes out ok so far about the course in general how am I doing on time yeah now the very first reason supply chain dynamics why is it that it's not 10% but a 100 or 500% change well that has to do with the world the world has changed where are we coming from here's a personal story in 1987 just after graduating from this wonderful school I planned to do my PhD research in business at philips electronics gradually the story becomes less about me and more about philips electronics because that's a good example so what can you tell well first of all the corporate staff of philips electronics actually did research applied research not quite that common nowadays en in fact they had made serious contribution to the literature in the theory on supply chain management I lived I lived in a home which was rented to me by philips they had their own homes of course every unilever shell dsm they all have sold homes of course and all my whole street in the room in my house I have all this electronic equipment that they bought from the philips personnel's en they made everything they made refrigerators they made CD players everything that had electronic current they made it was of course made and I had a serious tour of all those factories in philips factories and the components were also made by philips and then sold under the philips brand name and of course my sports activities were at the psv nearby not the professional football team etc this was the year by the way that psv became a european champion so I could benefit from that I was just the young to build a pension at the philips pension funds which in retrospect is only 2 well because I would be a few hundred million short well is the record and of course my insurances were at the philips own insurance fund that is reality one generation ago 20, well not quite 25 years quarter a century ago, just one generation it's unheard of nowadays just 25 years so what happened well while I was there the whole department was already reorganized the whole big corporate staff was split up the whole business where there were all the non-core functions from cafeteria IT were outsourced all the component production went out the assembly was outsourced to other companies engineering and even customer care were also outsourced middle management the lame laag the brick layer the clay layer was cut out performance elevation was much more formal much more geared towards the short term silly stuff like sponsoring phd research in your company was certainly not thought of well a most measurable financial company the combination of different back then philips lighting professional components and industrial equipment medical etc because every year some company was doing well but there was no longer thought of highly by the financial analyst because that means that one company is in different sectors and they have this secret formula by which they evaluate the volatility so the risk in a certain sector and if you are in different sectors they can't make their calculations anymore so they don't like you so that was split up as torque was split up as many companies were split up management became back then almost all senior managers philips bread they had worked in various areas around the world vast majority of them had a technical background the other ones were in sales and it's also thought of we have an MBA manager corbónstra was used to selling stuff in consumer goods and so the free slant milk etc was bought in to save the company and that's totally different on a theoretical frame when I was still studying here this is how we looked this is how my textbooks looked at the business, at companies yet an internal value chain here you think of new products and a number of steps as a business you make those products and you set a certain market demand for a new product which is a certain life cycle if you could only have we made calculations and optimizations calculations about that for centralized decision making one of the central mantra believes that we had here was and I actually remember making those calculations that it's if each of these parts tried to optimize their own operations it would be the sub optimization of the whole it was a saying like een zwaad u nog geen zomer of whatever a sub optimization optimization of the parts a sub optimization of the whole but that's precise what happened isn't it so in the reality by the way there wasn't the IT yet to manage all these factories and all those different countries as a whole so in fact it was managed bit by bit because the IT and the governance could only manage at the time but what happened is that those life cycles shrank very much and as a result of that this is much more the reality it's no longer a big super tanker it's a convoy and these are no longer super tanks they are work boats, very small boats and they have all their coordination but how do these companies coordinate that's very difficult there is no it's not the market anymore but somebody is centrally in charge so how do you do that well this is one of the reasons why companies have much greater difficulties and the other reason of course that indeed the market has changed so what you would like to have or struggling for which is also a partly task of information management without anyone being in control how can you still effectively coordinate your operations we saw this some 10, 15 years ago there was a reason to come back to university because the textbooks that I had had as a student no longer were correct how do we solve this well and there are experiments this is asml for instance asml after this horrible period they had a sales and operation process in which people from marketing and people from sales and people from operations and people from finance jointly agree on ok at the very least this is what we know that we have in orders this is the time this is the cumulative orders that they have if sales is really happy and lucky then the red line is what we now think we can sell so somewhere around there we all agree on this what we will make even though and we share this with our suppliers and also with our customers by the way so you try to find some alignment through coordination of information for the for the airbus case is collaborative planning is a way in which you actually in this case chapter 10 collaborative planning here it was these were some companies in the digital storage area here was supplier component suppliers they all fed their information on what they thought what they were planning to do this week and what they had in stock together for the whole supply chain consisting of four or five different independent companies it was calculated what was the best thing to do for the entire company so an example of how you could do that in KPN after the crash of the by the way and that's what airbus should have done and is now doing today in KPN what they revived actually was a sales and operation planning I said revived because one of the people that I worked with there said hey we stopped this process 10 years ago and now we're starting it again so again all these different groups that together decide whether or not you can meet all the demands that you're getting in in your service supply chain can be fulfilled and how you can do that so that's a couple of the examples there in all these examples there are hard tangible calculations to make about absolute numbers of orders capacities but the real difficult part is the human part is the emotional part is the feelings part there is a technical background for this again which is that all the feedback loops between how much you trust the other party and how much they trust you or how much you trust somebody and how often you communicate with them they are reinforcing and therefore destabilizing to take this week in the press what could easily happen is something happens in the Krim in Ukraine a very tiny element and the Krim has been a problematic region for 300 years the Russians do something which the Europeans don't like the Europeans or the Americans react in a way which upsets the Russians the Russians think we can do a bit more and they send some more troops the Europeans reply with more sanction and more tough talk on the TV etc by which the Russians think you know what let's do this immediately and before you know it you have an escalation so human emotions are often escalating upward and downward so if you have that in your personal relation you can have a big fight but after you can make up and the more that you are nice to your dear one the more that he or she will be nice to you and the more cozy it will get and that's a typical destabilizing mechanism which is needed to get all those all that technical stuff going all the stuff about aligning of a capacity with demand etc so this is also an important part and they also have 3 cases of more focusing mostly on the relationship dynamics that's also information management but because the soft part is really the hard part but we still study it from a decision making perspective we still study it by making simulation models of stuff like trust openness communication transparency etc so that's the challenge are you ready for takeoff this was a very short intro into my course I cannot tell you if it's really typical for information management as a true academic I am very focused on my own part of the curriculum but you hear more about the other parts but at least I've been asked to tell you a bit more about my course and what is it about I think it's a nice combination of the business side of the management side of what somebody with a master in information management should be able to do and understand and also the teaching style with its blended learning of youtube clips and simulation models and still text etc is also I think representative for the kind of teaching style that we want but the rest is up to you