foundation 2013 intro
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Welcome to the Foundation® Business Simulation
School: Bloomsburg University Professor: Dr. Lam Nguyen
Class: MGMT 481-Business Policy
Objectives Demonstrate effectiveness of multi-discipline teams working together.
Use strategic thinking.
Test your business acumen.
Understand overall interaction and impact of various parts of a
business on one another.
Grow the awareness of competition.
Take away practical know-how to improve the effectiveness of your
business.
Why Simulate?
Risk Free
View Alternative Strategies
Enjoyable
Compresses Time (1 Round=1Year)
Selectivity <=> Integration
SENSOR INDUSTRY OVERVIEW
Customers (OEMs) need sensors
for their products
Initially one segment, now
breaking into two
Very different customer demands
developing between the segments
Diversification in the use and
utility of the sensors
The Marketplace
Low Tech
High Tech
In our industry we track the
changing customer demand on a
perceptual map
Over 8 years customers will
demand much faster and smaller
sensors
Market Segments will
continue to diverge
Low
Tech
High
Tech
The Marketplace
You’re not giving me what I want
“I want these sensors to be cheap”
“I want them to have been around
for a while – no Beta Testing!”
“They have to be moderately
reliable.”
“The technology doesn’t have to be
cutting edge.”
Low Tech Customers
And I’m not
getting what I
want!
“These sensors have to be small, like
micro, and fast”
“I need them to be right out of R&D,
I’m talking ZERO years on the market”
“I’m willing to pay more to get what I
want.”
“I like a pretty high reliability.”
High Tech Customers
0
2000
4000
6000
8000
10000
12000
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8
Sensor Industry
Low Tech High Tech
SENSOR INDUSTRY ANALYST PROJECT ONGOING GROWTH
Sees the next 8 years as consistent growth. All market segments increase at a nice “clip,” according to market analyst.
“I see the entire market growing
at around 14% or 15% per year.
The High Tech market alone will
be growing at a whopping
20%.”
I hope those companies out
there are ready for that kind of
expansion!”
COMPANY OVERVIEW
SEC ANNOUNCES BREAKUP OF MONOPOLY
FOR IMMEDIATE RELEASE
The SEC, took dramatic action today by breaking up
the monolithic corporation Sensors, Inc.
In a statement to the press, the SEC outlined the
reason and the outcome of this move.
“We cannot allow monopolies of this sort to impact an
entire industry! The customers that utilize these
sensors are being held hostage.”
“Effective immediately Sensors, Inc will be dissolved
into the Andrews, Baldwin, Chester, Digby, Erie and
Ferris companies.”
The Competition $40 Million in Sales
1 Product Line
2 Segments
Closed Marketplace
6 Companies
Andrews Digby Baldwin Erie Chester Ferris
SHAKE UP IN SENSOR INDUSTRY: Company Fires Management Team!!!!
After poor results, lackluster sales and angry customer reports, the Chairman of the Board of Directors has announced the immediate termination of the Management Team. “This is a black day for our company,” said Chairman Dr. Lam Nguyen, “We need to hire a dynamic leadership group that will be able to take this company into the future!” “Due to this immediate need I have hired the Dream Team to start on January 1st. I expect to see great things from this Executive Team!
Welcome To Your New Company
Students need to coordinate strategy and tactics across the following areas of
their company:
Establish the specification of the
products to meet customer demand
Build the quality and reliability
(MTBF) into the products
Ensure the perceived age of the
product meets customer demands
Create new products to meet the
changing marketplace
“Our products are not well
positioned in the marketplace.”
R&D
Set the price of our products in the
marketplace
Build customer awareness through
promotion
Establish a sales force and
distribution channels
Set the sales forecast for our
products
Set Credit Policies AR/AP
“Our products are not priced
optimally.
And many of our customers don’t even know our product exists.”
Marketing
Purchase machinery to automate
our facilities
Buy or sell capacity of product
lines
Schedule production for each line
Manage the majority of the
companies fixed assets
Establish your workforce
complement
“We are paying too much for labor costs.
Very soon we will run out
of capacity to meet demand.”
Production
Acquire capital to fund capital
expansions
•Issue Stock
•Short Term Debt
•Issue Long Term Bonds
Issue dividend to our shareholders
Balance our debt portfolio
Manage our Proformas
“We have poor cash flow and substandard
financial ratios.
We have no financial policy
statement.”
Finance
A great management tool driven by forecasts and projections. Allows “What if” Scenarios by the company.
Balance Sheet
Profit & Loss
Cash Flow
Financial Ratios
Proformas
Scoring Methods
Success Measures: oBalanced Scorecard
oROE
oROS
oROA
oCumulative Profit
oStock Price
oMarket Capitalization
oAsset Turnover
oMarket Share
oWeight each selection
Analyst Report
Running your Company
Establish business strategy for your company
Analyze Foundation FastTrack to see industry results
Make tactical decisions across each functional area (aligned to
strategy!)
Upload official results and confirm on the website
Await results when Professor processes
Rejoice in your superior capitalistic acumen
Begin the process again by confirming alignment of your results
with your company’s strategic goal.
Things to do on an Annual Basis
Good Luck and Enjoy!
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