capsim report 4555 Words | 19 Pages. One basic strategy is Broad Differentiation. Example: No change required. We measure performance in terms of market share, market cap, ROA, and profits. A Broad Differentiator strategy … We shall use team Erie as an example. In the Physical Plant Section, Erie wants to make sure they have enough 1st shift capacity not to pay overtime to employees. • Have a pre-grade option that would allow teams to send in their decisions to CAPSIM for a review and recommendations before official submit. In the Production Margins Area we have listed the total unit cost and contribution margins. In the High End, Performance and Size segments customers want new and better products. Executive Summary The Digby team will adopt a Broad Differentiation strategy, maintaining a presence in every segment. Capsim Team Strategy Report Our team decided to choose the “Broad Differentiation” strategy as the basic strategy for our company. opportunity for success, as they enable a company to create a competitive advantage by having differentiated products, services or business models. This will help each company develop a strategy for the competition. All five segments: Traditional, Low, High, Performance and Size equals 100%. In the Production Module Schedule the sales forecast carries over to the Unit Sales Forecast. This practice exercise will help you understand the relationships between business strategy, tactics, functional alignment, and the Capstone® simulation. Fire. The Secret to Capsim Success it’s all about the sweet spot… Team Andrews Fall I 2009 BUSN 6200 Presented By Team Andrews: Brad White, Tim Fish, Christina Vance, Stephanie Bogan, & Anthony Vatterott Team Approach Vision Statement To design and manufacture the world’s most cutting edge electronic sensors. We simulated developing silicon wafers for 6 rounds representing 6 years. Automation costs money but a small increase in automation, 0.3 per year may be enough to stay competitive. Broad Differentiation. This is a competition and Erie has to adjust to the marketplace. This Broad Differentiation Strategy only works if Erie compares its segment products to the other teams’ products and adjusts pricing, promotion and sales. This improves the position of the product, making it more appealing to our customers. These revisions change the Age at Revision for each segment. Our goal is to offer customers products that match their ideal criteria for positioning, age, and reliability. Let’s take the Traditional segment which has industry unit sales of 7,387,000 units or 32.4% of the market in round zero. It's a strategy that works better for larger companies than smaller ones. Access The Broad Differentiation Sample. We will keep our existing product line, and introduce at least one more line, maintaining a presence in both segments. Capsim Simulation Broad Differentiation Strategy. Broad differentiation is a strategy that is applied across an industry, appealing to a broad range of shoppers. Chester’s performance product is Coat. We will grow capacity to meet the demand that we generate, avoiding second shift/overtime when possible. Daze - Improve positioning and reduce age. Our team's original strategy was broad differentiation. I usually go for broad differentiation because it is more flexible. The teams played two practice rounds before beginning the actual competition. In the Capsim simulation course at Georgian Court University, Lakewood, NJ in summer session 2012, there are six companies are: Andrews, Baldwin, Chester, Digby, Eire and Ferris (Computer). The Human Resources Module will be added in the third round. Broad Differentiation Capsim. Erie Company has to implement a plan to upgrade the performance, size and Mean Time before Failure (MTBF) of its products. CAPSIM SIMULATION WINNERS!BY: MINHEE HUH, MOLLY MCGOWAN, AND KING TAN 2. When the round is complete Erie can compare the segment performance and size coordinates with the other companies’ segments in the Capstone Courier. Erie must analyze what the other companies have done with their segments. After the practice rounds, you are free to pursue any strategy you wish, and can abandon the Broad Differentiation strategy entirely. It is best for Erie to price products at a mid-range in order to be competitive. We will finance our investments primarily through stock issues and cash from operations, supplementing with bond offerings on an as needed basis. Improve reliability (MTBF) to enhance demand. Enjoy! SHAREHOLDER MEETING 3. Capacity is expanded as higher demand is generated. Competitive advantage is gained by distinguishing products with an excellent design, high awareness, and easy accessibility. As a broad differentiator in the market, the performance segment focuses on the reliability and ideal position of the product. Erie must check in the Capstone Courier to see which teams are automating. Firm Profile: Multiple product lines in targeted segments (High End, Traditional, and Low End) Minimum focus in other segments Dot - Improve positioning and reduce age. R&D competency is developed that keeps designs fresh and exciting. The first round ends December 31, 2013. In the computer simulation I would recommend not to buy back stock unless your company has a great over surplus of funds. In the real world companies buy back stock. Less stock on the open market will increase the price per share of the company’s stock. The industry simulation is the sensor industry. A Broad differentiation strategy maintains a presence in every segment of the market. The Digby computer team will maintain a presence in both segments of the market. We will price at a premium. We have six teams in the simulation: Andrews, Baldwin, Chester, Digby, Erie and Ferris. Explanation: Broad Differentiation strategy refers to building a business or a brand that differs significantly from that of the competitor. We want every customer to know about our superb designs, and we want to make our products easy for customers to find. Mission Premium products … Moreover, the company will gain a competitive advantage by distinguishing products with an excellent design, high awareness and easy accessibility. Not hard to do, since they were incompetent, but it was fun! Premium products for the industry: our brands withstand the tests of time. Erie does this calculation for the rest of the segment products: Low-Ebb, High-Echo, Performance-Ebb and Size-Egg. We expect to keep assets/equity (leverage) between 1.5 and 2.0. Prices are above average. Examp… In the Workforce complement a second shift is not added until the first shift reaches its needed complement. This is a rule of thumb when making a Sales Forecast. It is essential in most companies and have exemplary impact on consumers, thus a good remedy for the Capsim. Under the Unit Sales Forecast is the Inventory on Hand. The Digby team will spend aggressively in promotion and sales in both segments. In the Finance Module, as a basic rule of thumb keep accounts receivable at 30 days lag and accounts payable at 30 days lag. A Differentiation Strategy with a Product Life Cycle Focus seeks to be known far and wide as the top producer of the best performing state-of-the-art products. The teams will play six rounds in the simulation. CAPSIM-Team Ferris Nikita Motkur, Howie Hehrer, Cori Porasik, Priscilla Gonzalez & Neha Noonemunthala December 8, 2016- BUS 6990 Strategy Formulation and Org. Differentiation Strategy with a Product Life Cycle Focus. CHANGING STRATEGIES TO MAKE BETTER PRODUCTS• Original Strategy: • Cost Leadership • Differentiation Strategy• New Strategy • Focus Cost Leadership Strategy • Differentiation Strategy 4. Two competitors are pursuing Broad Differentiator strategies. We will gain a competitive advantage by distinguishing our products with an excellent design, high awareness, and easy accessibility. Erie must make a comparison to see what the other companies are promoting. Erie uses this basic calculation for the other product segments. Although the Capstone Team Member Guide recommends a 30% contribution margin in each segment, this is very hard to accomplish during competitive rounds. There are six basic team strategies listed on page 24 in the Capstone Team Member Guide 2012. In order for this strategy to work a company has to be aware of what the competition is doing every round. Products keep pace with the market, offering improved size and performance. Capsim Strategic Management Simulation: First Place. • Strategy – Broad Differentiation • Presence in every segment (check) • Excellent design (5 of 5 segments) ... not what our strategy was. It may be necessary to increase automation gradually over the rounds of the competition. As the game progresses, you can change it to a hybrid of broad differentiation. We are somewhat adverse to debt, and prefer to avoid interest payments. Broad Differentiation Strategy is quite unique and brings about many Examples. (During the practice rounds, each company is assigned a different strategy.) In the practice rounds the individual companies get an idea of the strategy performed by the other teams and the computer team Ferris. Andrews has decided to adopt features from several different basic strategies to form our own hybrid strategy. © 1985 - 2011 Capsim Management Simulations, Inc. 16.1 Andrews - Cost Leader with a Product Lifecycle Focus, 16.2 Baldwin - Differentiation with a Product Lifecycle Focus. 12.4 Broad Differentiation. The promotion and sales budgets should be in the mid pricing range. James Cage (author) from Orlando, FL on November 15, 2013. Erie makes improvements for each product to beat the competition in all five segments for the next round. Dell - Leave positioning alone, allowing the product to age further. Erie may be able to increase the contribution margin in some of the other segments but an average of 25% contribution margin in all segments is pretty good. In the Traditional and Low End segments the age of the product can be older. Let us begin with the Research and Development Module. Design 2. We will gain a competitive advantage by distinguishing our products with an excellent design, high awareness, and easy accessibility. The Digby computer team will adopt a Broad Differentiation strategy, maintaining a presence in every segment. We chose broad differentiation as a a strategy. basic capsim strategies.pptx - cost leadership life cycles product developm ent operating factors differentiation market segment factors size broad cost The only way to improve your company’s performance is to analyze what the other teams are doing each round and make adjustments for all modules. Areas we excelled: Standardized and proprietary tools & processes Positioning, forecasting (early rounds) Functional expertise & strong communication Early, aggressive TQM investments - able to lead our segments and achieve higher margins Management Decision Process Cross It received a market share 15% within 3 rounds of execution. In this simulation there are the following modules: Research and Development; Marketing, Production and Finance. Daze - Slightly reduce reliability (MTBF) to … Our primary stakeholders are customers, stockholders, management, and employees. Competitive advantage is gained by distinguishing products with an excellent design, high awareness, and easy accessibility. Note that Erie may be able to charge a better price for the High-End, Performance and Size products but the Traditional and Low-End products have to have a more modest price. Hold reliability (MTBF) steady. Each Industry segment makes up a percent of the market. The main objective of implementing a differentiation strategy is to increase competitive advantage. Our original strategy had failing results and our team placed last at the end of the first round. In CapSim, a firm should launch a new product if: The strategy calls for it in the Team Member or On-Line Guide. The computer will then calculate the unit Production after Adjustment. Erie should divide the 7,387,000 units by 6 and make a prediction that Erie will sell approximately 1,231,167 units. A final note, this is a competition among teams. But more important and effective than this is how Nike makes its customers feel. Erie must adjust the Production Schedule for Traditional-Eat to equal 1,231,161 units. The number 1,231 is placed in the box. Wondering what the easiest strategy is for Capsim and why. These strategies are Broad Cost Leader; Broad Differentiation; Niche Cost Leader (Low Technology); Niche Differentiation (High Technology); Cost Leader with Product Lifecycle Focus and Differentiation with Product Lifecycle Focus. Example: Increase Dixie 's performance by 1.2 and reduce Size by 1.0. Example: Increase Daze ' s performance by 0.8 and reduce size by 1.0. There are actual market share units listed in the Capstone Courier. CAPSIM ANALYSIS: FERRIS 14 700 by the end of Round 8 with a plant utilization of 184%. Note that the highest to lowest market share in units in the competition is Low End, Traditional, High End, Size and Performance. Currently my team is doing Niche Cost Leader (for practice rounds) but finding it very difficult and wondering if we should switch when the real simulation starts. This makes it easier to adjust to what the other companies are doing. Hold reliability (MTBF) steady. Broad Differentiation. In this case, I mean making adjustments, especially on thrift segment, to sell at a lower price than the industrial average to maximize your market share. Nothing personal, chumps! At the end of the round, Erie can do a comparison price check against the other companies’ products in the Capstone Courier. Hence an innovative strategy is highly recommended in order to achieve high business growth, in case you are willing to expose you to a higher degree of risk. Ideal Automation Rates and New Products Broad Differentiation Strategy I have read so many different automation strategies and would like to know with reasons which is best. The prices of products are reduced by $0.50 each year. We will use the Digby team for this example. Erie should keep their revision dates before July 1 of the current round. Even though High, Size and Performance sell fewer units these segments sell at higher prices. The Digby computer team will maintain a presence in both segments of the market. When a company pays back bonds the company’s S&P rating will improve. 1. After our products are well positioned, we will investigate modest increases in automation levels to improve margins, but never at the expense of our ability to reposition products and keep up with segments as they move across the perceptual map. When you sell stock in the marketplace this will decreases the price per share of your company’s stock. CAPSIM - Winner Presentation (An example of utter dominance) Here is the presentation of my CAPSIM simulation team (Team Baldwin), in which we mercilessly destroyed, decimated, and demoralized our competitors into oblivion! A rule of thumb is to keep the contribution margin above 25%. Choose COMPXM strategy . The industry simulation is the sensor industry. Fire was able to produce sales for 1,235 units with its capacity of 14. The first customer buying criterion is reliability (measured in hours) as Mean Time Before Failure (MTBF) rated importance of 43%. We will develop an R&D competency that keeps our designs fresh and exciting. When our cash position allows, we will establish a dividend policy and begin to retire stock. We will attempt to differentiate our product line … If a company overestimates sales or spends too much money, current debt may increase. Erie keys off of the Industry Conditions Report Performance and Size Centers for each round listed for the following segments: Traditional-Eat; Low End-Ebb; High End-Echo; Performance-Edge and Size-Eat. 15.4 Digby - Broad Differentiation. In the Marketing Module Erie must improve the price of segment products round by round. A differentiation strategy is an approach businesses develop by providing customers with something unique, different and distinct from items their competitors may offer in the marketplace. CAPSIM PRESENTATION-TEAM FERRIS 1. In order to achieve the broad differentiator strategy, a new product was introduced in the high segment i.e. Hold reliability (MTBF) steady. Follow the decision guidelines below unless directed otherwise by your instructor. Dixie - Improve positioning and reduce age. 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