capstone computerbasedsimulation. $100m electronic sensor$100m electronic sensor manufacturer....
TRANSCRIPT
CapstoneCapstone
Computer Computer
BasedBased
SimulationSimulation
• $100M electronic sensor$100M electronic sensor
manufacturer.manufacturer.
• Market dominated by handful of firms.Market dominated by handful of firms.
• No outside competitors or substitutes.No outside competitors or substitutes.
• Benign environment.Benign environment.
The Playing FieldThe Playing Field
Strategic MapStrategic MapLargeLarge
SmallSmall
SlowSlow FastFast
SizeSize
PerformancePerformance
Perceptual MapPerceptual Map
LargeLarge
SmallSmall
SlowSlow FastFast
SizeSize
PerformancePerformance
Product SegmentsProduct Segments
Low-End
Low-End
TraditionalTraditional
Size Size High-End High-End
PerformancePerformance
Perceptual MapPerceptual Map
LargeLarge
SmallSmall
SlowSlow FastFast
SizeSize
PerformancePerformance
Low Low
TradTrad
Size Size High High
Perf Perf11
22
33
44
55 Sweet SpotSweet Spot
Each Segment has a Sweet SpotEach Segment has a Sweet Spot
Perceptual MapPerceptual Map
LargeLarge
SmallSmall
SlowSlow FastFast
SizeSize
PerformancePerformance
Segments drift over timeSegments drift over time
Low Low
TradTrad
Size Size High High
PerfPerf
Two Stage Purchase DecisionTwo Stage Purchase Decision
Stage 1 - Match Product to MarketStage 1 - Match Product to Market
1. Product must plot within the segment.. Product must plot within the segment.
AbleAble
SizeSize
PerformancePerformance2. Product must fall within 2. Product must fall within
price guidelines.price guidelines.
AbleAble
PricePrice
SegmentsSegments
3. Product must fall3. Product must fall
within quality guidelineswithin quality guidelines
AbleAble
QualityQuality
SegmentsSegments
Two Stage Purchase DecisionTwo Stage Purchase Decision
Stage 2 - Rank Best Product Stage 2 - Rank Best Product
PositionPosition
AgeAge
QualityQuality
PricePrice
1. Positioning
2. Age
3. Quality
4. Price
1. Positioning
2. Age
3. Quality
4. Price
33 Sweet Spot
Sweet Spot
ABAB
00 11YrsYrs
2000020000 2500025000
$30$30 $40$40HIGH ENDHIGH END
Segment Criteria RankingSegment Criteria Ranking
TraditionalTraditionalTraditionalTraditional SizeSizeSizeSizePfmnPfmnPfmnPfmnHigh EndHigh EndHigh EndHigh EndLow EndLow EndLow EndLow End
Age
Price
Position
Quality
Age
Price
Position
Quality
Price
Age
Position
Quality
Price
Age
Position
Quality
Position
Age
Quality
Price
Position
Age
Quality
Price
Quality
Position
Price
Age
Quality
Position
Price
Age
Position
Age
Quality
Price
Position
Age
Quality
Price
Functional AreasFunctional Areas
R&DR&D
MarketingMarketing
ProductionProduction
HRHR
FinanceFinance
Research & DevelopmentResearch & Development
• Set Product coordinates (Position)Set Product coordinates (Position)
• Set MTBF rating (Quality)Set MTBF rating (Quality)
• Drives Perceived age (Age)Drives Perceived age (Age)
• Drives breadth of product lineDrives breadth of product line
Quality Age Breadth
High High Eight
Low Low One
<
<
<
AB
AB
• Cycle time affected by:Cycle time affected by:
– Automation level of production line
– Number of projects underway
– Distance moved on perceptual map
• Cycle time affected by:Cycle time affected by:
– Automation level of production line
– Number of projects underway
– Distance moved on perceptual map
R & D Factors on Existing Products
R & D Factors on Existing Products
High
Low
AutomationAutomationLevelLevel
Number ofNumber ofProjectsProjects
High
Low
High
Low
DistanceDistancemovedmoved
< < <Short
Long
Cycle TimeCycle Time
<
MarketingMarketing• PricePrice
• Promotion BudgetPromotion Budget
• Sales BudgetSales Budget
• Set Sales ForecastSet Sales Forecast
• Set Credit Policies Set Credit Policies AR/APAR/AP
ProductionProduction• Set automation levelSet automation level
• Buy or sell capacityBuy or sell capacity
• Schedule productionSchedule production
• One year lag to One year lag to add capacity or add capacity or automateautomate
FinanceFinance
• Acquire CapitalAcquire Capital– Issue StockIssue Stock
– Short Term DebtShort Term Debt
– Issue Long Term BondsIssue Long Term Bonds
• Set DividendSet Dividend
• Retire Long Term BondsRetire Long Term Bonds
• Retire StockRetire Stock
• Emergency LoanEmergency Loan
CAPSTONE STRATEGIES• Business-level strategyBusiness-level strategy::
– Overall Cost LeaderOverall Cost Leader
– Cost Leader with Cost Leader with Focus (Low Tech or Focus (Low Tech or Product Life-Cycle)Product Life-Cycle)
– DifferentiatorDifferentiator
– Differentiator with Differentiator with Focus (High-Tech or Focus (High-Tech or Product Life-Cycle)Product Life-Cycle)
STRATEGYSTRATEGYMission StatementMission Statement
GoalsGoals
PERFORMANCEPERFORMANCEASSESSMENTASSESSMENT
Success MeasurementsSuccess MeasurementsRatiosRatios
StatisticsStatistics
ANALYSISANALYSISS.W.O.T AnalysisS.W.O.T Analysis
Competitor AnalysisCompetitor AnalysisCompetitive AnalysisCompetitive Analysis
FUNCTIONAL PLANNINGFUNCTIONAL PLANNINGMarketingMarketingProductionProduction
FinanceFinanceR&DR&DHRHR
Success Measurements
• Choose at least TWO prior to Round 3Choose at least TWO prior to Round 3• Ending Stock PriceEnding Stock Price must be weighted must be weighted
no less than 20%no less than 20%• Others:Others:
– Cumulative Profit– Avg. Market Share– Asset Turnover– Avg. ROA– Avg. ROE– Avg. ROS
• Criteria and Weights will remain Criteria and Weights will remain proprietary throughout the simulationproprietary throughout the simulation
Situation Analysis
• Perceptual MapPerceptual Map
• Demand AnalysisDemand Analysis
• Capacity AnalysisCapacity Analysis
• Margin AnalysisMargin Analysis
Pre-Game Strategy Memo
• Intended StrategyIntended Strategy– Corporate: In which segments will you compete?
– Business: How will you compete in each segment?
• Situation AnalysisSituation Analysis
• Specific GoalsSpecific Goals
• Strategies and TacticsStrategies and Tactics– R&D actions
– Marketing actions
– Production actions
• One (1) page of text; one (1) page of exhibitsOne (1) page of text; one (1) page of exhibits
• DueDue: Monday Nov. 4 @ 2:00 p.m. : Monday Nov. 4 @ 2:00 p.m.
Capstone Schedule
Monday 11/4: Monday 11/4: Year 2000 Decisions 12:00 p.m. Year 2000 Decisions 12:00 p.m. Wednesday 11/6: Wednesday 11/6: Year 2001 Decisions 9:00 p.m. Year 2001 Decisions 9:00 p.m.
Monday 11/11: Monday 11/11: Year 2002 Decisions 12:00 p.m. Year 2002 Decisions 12:00 p.m. Thursday 11/14: Thursday 11/14: Year 2003 Decisions 12:00 p.m. Year 2003 Decisions 12:00 p.m.
Monday 11/18: Monday 11/18: Year 2004 Decisions 12:00 p.m. Year 2004 Decisions 12:00 p.m. Wednesday 11/6: Wednesday 11/6: Year 2005 Decisions 9:00 p.m. Year 2005 Decisions 9:00 p.m.
Monday 11/25: Monday 11/25: Year 2006 Decisions 12:00 p.m. Year 2006 Decisions 12:00 p.m.