Overview You are now MBA’s You are the experts. You have had the training. Top 5% of Educated People in the World You make the rules. If you don’t like the rules, change them. You write the books. If you don’t like what a book says, change it. You teach the classes. Simulation Used to Learn Real Life Airline Pilots Astronauts Businesses Games Fun Entertainment Not a Class To Teach Skills Class to Apply What You Already Know BUSN 6120 Economics MRKT 5000 Marketing BUSN 6110 Production and Operations FINC 5000 & 5880 Finance HRMG 5000 Human Resources Others Sensors Identical Competitors Monopoly Breakup Everyone Begins the Same Oligopoly Market Structure The Team Member Guide is your definitive resource for what happens in the simulation. Know it well. Everything in it is important It is overwhelming at first. It will get better as we go. Everyone must do the rehearsal tutorial before we start the simulation. Where you get familiar with how the simultion works. It is a tutorial on how to use the simulation. It is not a practice round. It is not a competition round. It is not the COMP-XM exam. Important step Don’t leave it out. Tells about Current Market Conditions How the Industry Will Evolve Operational Planning The Industry Conditions Report (One Time) The Capstone Courier (The Newspaper) Rubric Debrief Report (Understanding Mistakes) Many Others Like a Real World Business Information is Everywhere. You must find what is useful. No one is going to tell you where to look. Use the Online Spreadsheet Let One Student do all the Updating Research and Development Marketing Production Finance Other Human Resources (later in simulation) Information Technology (Spreadsheets) Designs Product Lines Invents New Products Revises Current Products Pay attention to Lead Times Sets Prices Promotes Your Product Very Important Spend a Lot of Money on Promotion Creates Customer AWARENESS One of the things beginners get wrong. Sales Forecast How Many Units You Will Produce Determines Production Capacity Discontinues Lines Sells all inventory at half price Sets Automation Levels Labor Costs go down as automation increases Takes Time Possible to Over-automate Buys and Sells Production Lines Raises Money to Run the Business Bank Notes Bond Issues Retirements Stock Issues Dividends Buy Back Stock The HR Module Begins in Round 2 Allows you to manage the people you have. The TQM Module Begins in Round 3 TQM is your Friend Use it to Lower Your Costs Rehearsal Tutorial Practice Rounds 8 Rounds, Team Play Competition Rounds Individual 8 Rounds, Team Play Comp-XM (Exam Rounds) 5 Rounds, Individual Each Round Each Team Uploads their Round Info Spin the Round Represents One Year Takes 1-2 Hours to Complete Happens for all teams at the same time Analyze The Results Upload the Next Round Published Once at the Beginning Price Age MTBF Positioning Size Performance Deals with Positioning See Page 4 of Team Member Guide Drift (Industry Conditions Report) Fine Cut Rough Cut Outside Extremely Important Understand Your Customer Survey Score See Section 3.2 of the Team Member Guide Product Demand is Based on the CSS. Build a Spreadsheet!! Broad Cost Leader Broad Differentiator Niche Cost Leader (Low Tech) Niche Differentiator (High Tech) Cost Leader with Product Life Cycle Focus High end, traditional, and low end focus Differentiator with Product Life Cycle Focus High end, traditional, and low end focus Borrowing money at high interest rates because you didn’t have enough cash to run the business. Remember: Retained Earnings is not a cash account. Stock outs are bad Understand them and avoid them when possible Marketing – Conservative In case sales don’t materialize Production – Aggressive Because Finished Goods Inventory is a Liquid Asset Awareness – Customers are Aware of Your Product Accessibility – Customers Can Find Your Product Promotion Budget Sales Budget Spend Lots of Money on Both of These Your competitors are Good The Computer Teams are Good Don’t Make Mistakes Early You can easily get behind and go bankrupt. There is NO RESET BUTTON. You live with the consequences of your decisions. See the Six Basic Strategies Pick One Stick with it. If it doesn’t Work, Change it. There are Other Strategies See the Strategic Planning Process Presentation Companies pay employees lots of money to spend full time dealing with these issues If you run out of things to do in this 1-2 hour exercise, you are doing something wrong. There is always more you can do.