Combining Narrative and Numerical Simulation: A Supply Chain Case

Strategic simulation is the combination of narrative and numerical simulation and can be used as a tool to support strategic decision making by providing different scenarios in combination with computer modelling. The core of the combined simulation approach (CSA) is to make it possible for decision makers to systematically test several different outputs of possible solutions in order to prepare for future consequences.

The CSA can be a way to evaluate risks and address possible unforeseen problems in a more methodical way than either guessing or forecasting. This paper contributes to the decision making in operations and production management by providing new insights into modelling and simulation based on the combined narrative and numerical simulation approach as a tool for strategy making.

The research question asks, “How can the CSA be applied in a practical context to support strategy making?” The paper uses a case study where interviews and observations were carried out in a Danish corporation. The CSA is a new way to address decision making and has both practical value and further expands the use of strategic simulation as a management tool.