Strategic Management - Professor Craig Kelley California State University, Sacramento

REQUIRED MATERIALS

Capstone^®; Business Simulation, Management Simulations, Inc.

[You may purchase the materials through the Hornet Bookstore or through the Capsim web site www.capsim.com]

(You must register on the Capsim^®; website to receive credit for this course. Register at www.capsim.com after you are assigned to a team).

COURSE OBJECTIVES

Strategic Management builds upon the knowledge gained in the business core. Emphasis is placed on making functional, business level and strategic decisions. This is accomplished by encouraging the student to act as a "manager" in making decisions and supporting them with well developed analysis. Specific objectives for all who participate in Strategic Management are:

1. To integrate concepts and knowledge from the core business courses.
2. To study market competition and to learn useful tools with particular emphasis on a systematic approach, a long-term orientation and a top management point-of-view.
3. To develop a framework of analysis that enables students to analyze organizations, marshal evidence to support conclusions drawn from the analysis and engage in problem solving in all areas of strategic management.
4. To stimulate creativity in implementing business solutions.
5. To develop team building and leadership skills.

CONDUCT OF THE COURSE

Participants in Strategic Management are required to complete assigned readings " prior " to class sessions when those readings are discussed. Class will be a combination of instructor lectures, interactive class discussions, and participant presentations. Interactive class discussions will be conducted under both Socratic and volunteer formats. Students are expected to approach the class as professionals .

GRADING

Average work in this course is a "C." Keep in mind that a score on an assignment may not equate to the amount of time that was spent on the assignment. Grades for the course will be determined based upon the following components:

Component Points

1. Eight rounds of Capstone^®; simulation results (maximum of 18 points possible each round, plus 6 points to round to 150) 150
2. Four sales forecasts (20 points each) 80
3. Management Memorandum 100
4. Competitor SWOT 20
5. Written Annual Report 100
6. Strategic Management Concepts Test 100
7. Competitiveness paper 60
8. Sarbanes-Oxley paper 100
9. Five rounds of Advanced Capstone^®; simulation results

(maximum of 18 points possible each round) 90

800

Final grades will be base d o n the following scale:

800 - 736 A

735 - 720 A-

719 - 704 B+

703 - 656 B

655 - 640 B-

639 - 624 C+

623 - 576 C

575 - 560 C-

559 - 480 D

479 - 0 F

STRATEGIC MANAGEMENT CONCEPTS TEST

You will take a test on key strategic management concepts that are covered from February 6-8. The test will be short answer/essay. The test is closed book and note but you are encouraged to review any source prior to taking the test. Power Point slides are available on my web site. NO MAKE-UP TEST WILL BE GIVEN.

CAPSTONE^®; DECISIONS

You will be assigned to a three-member team. Your task is to manage a business with five products, each targeted toward five different markets. You will compete against five other firms in the same industry. Your team's decisions for each round must be uploaded to the Capstone^®; website by 1:00 p.m. for the 12:00 p.m. class, 4:00 p.m. for the 3:00 p.m. class, and 5:00 p.m. for the 4:30 p.m. class. The game will run automatically so late decisions will not be accepted. To prevent gamesmanship you must submit decisions for an on-going business for all 8 decision periods. (For example, you can't stop production or sell capacity in the 8 decision period to maximize profit simply because there is no 9 th decision.) Your team must specify its measures of success based on your overall business strategy before the game is played for credit. You may pick three of the following measurement choices; total dollar profit, stock price, EPS, ROE, ROS, ROA, asset turnover, total market share, average contribution margin or total market capitalization. The measures that you pick will remain in effect for the duration of the game. You will be ranked 6 (highest) to 1 (lowest) on each measure per round. In addition, your team may earn up to five ‘stars' per round. Each star is worth one extra credit point. A star is earned for each period that your team has a profit, maintains a contribution margin of at least 30%, increases the stock price from the previous round, doesn't have any stock outs or inventory levels over 60 days, and no emergency loan.

*** Two practice rounds will be played before the game is played for credit. The purpose of the practice rounds is for the students to become familiar with the variables and mechanics of the game. You may not want to use your first choice of strategy for the practice round as your competitors will see the results.

ACCELERATED CAPSTONE^®; DECISIONS

Your team will run an accelerated Capstone^®; game. Your team's decisions for each round must be uploaded to the Capstone^®; website by 1:00 p.m. for the 12:00 p.m. class, 4:00 p.m. for the 3:00 p.m. class, and 5:00 p.m. for the 4:30 p.m. class. The game will run automatically so late decisions will not be accepted. Your team needs to specify its measures of success based on your overall business strategy before the accelerated game is played. You may pick three of the following measurement choices; total dollar profit, stock price, EPS, ROE, ROS, ROA, asset turnover, total market share, average contribution margin or total market capitalization. The measures that you pick will remain in effect for the duration of the game. You will be ranked 6 (highest) to 1 (lowest) on each measure per round. In addition, your team may earn up to five ‘stars' per round. Each star is worth an extra credit point. A star is earned for each period that your team has a profit, maintains a contribution margin of at least 30%, increases the stock price from the previous round, doesn't have any stock outs or inventory levels over 60 days, and no emergency loan.

CAPSTONE^®; TEAM WRITTEN ASSIGNMENTS

Your team will complete several written assignments. Each assignment must be typed (I don't read assignments that are not typed) and are due at the beginning of class on the date listed in the tentative schedule. No late papers will be accepted. These assignments are:

• Sales Forecasts for Rounds 2, 4, 6 & 7 
  Your team will submit a hard copy of a sales forecast for rounds 2, 4, 6 & 7. The forecasts are due before 1:00 p.m. for the 12:00 p.m. class, 4:00 p.m. for the 3:30 p.m. class, and 5:00 p.m. for the 4:30 p.m. class on the days that round 2, 4, 6 & 7 are run . Your team's actual results will be measured relative to your forecast. For example, if your actual results are 85% of your forecast, you will receive 85% of the possible points for this assignment.
• Management Memorandum
  Your team will prepare a written memorandum addressed to me that describes the following:
• The managerial roles that each member will assume during the game.
• The performance expectations of the members of the team.
• How each member of the team will be held accountable for their performance during the game.
• A detailed description of how your business strategy will be implemented during the course of the Capsim game. The strategy should include specific strategic and financial objectives for specific rounds of the game.
• Your measures of success. You must pick three of the following measurement choices; total dollar profit, average contribution margin, stock price, EPS, ROE, ROS, ROA, asset turnover, total market share or total market capitalization. The measures that you pick will remain in effect for the duration of the game. You will be ranked 6 (highest) to 1 (lowest) on each measure per round.
  Each team member must sign the memorandum. I will stop reading this assignment after the third grammatical error.
• Competitor SWOT Analysis

Your team will complete a SWOT analysis on your firm relative to the five competing firms in your industry. Please refer the SWOT on my web site for format. I will stop reading this assignment after the second grammatical error.

• Annual Report

Your team will prepare an annual report covering rounds 4-7 of the first Capstone^®; simulation game. Please refer to the annual report on my web site for format and content. I will stop reading this assignment after the third grammatical error.

Papers are due at the beginning of class on the date that they are due. No late papers will be accepted. Due to concerns over viruses I will not accept papers by email.

INDIVIDUAL PAPERS

Each participant in Strategic Management will write two papers. Each paper must be typed and are due at the beginning of class. No late papers will be accepted. In an effort to stimulate classroom discussion attendance is mandatory on the days that the papers are due. Due to concerns over viruses I will not accept papers via email.

• Read the articles on competitiveness and respond to the questions listed on the assignment found on my web site. This assignment has a maximum of two, single-spaced pages. I will stop reading your paper after the third grammatical error.
• A maximum five, single-spaced page paper on the origins, key sections and issues that impact business of the Sarbanes-Oxley Act. You should look at the pros and cons of various sections of the Act when addressing the issues faced by business. I will stop reading this paper after the third grammatical error.

TENTATIVE SCHEDULE

Date Topic Assignment

January 30 Introduction

February 1 Discuss competitiveness paper Competitiveness paper due

February 6 Introduction to Strategic Management, Industry-

Competitor Analysis, Strategy-Competitive Advantage

February 8 Diversification Strategies, Implementing

Strategic Plans

February 13 Strategic Management Concepts Test

February 15 Introduction to Capstone^®; Simulation Game,

Form Groups, Capstone^®; Practice Round Planning

February 20 Capstone^®; Team Meeting

February 22 Practice Round #1 decisions due

February 27 Capstone^®; Team Meeting Sarbanes-Oxley paper due,

attendance mandatory

March 1 Practice Round #2 decisions due

Date Topic Assignment

March 6 Capstone^®; Team Meeting

March 8 Round #1 decisions due, Capstone^®; Management Memorandum due

March 13 Capstone^®; Team Meeting

March 15 Round #2 decisions due, Capstone^®; Sales Forecast for Round 2 due

March 20 Capstone^®; Team Meeting

March 22 Round #3 decisions due

April 3 Capstone^®; Team Meeting

April 5 Round #4 decisions due, Capstone^®; Sales Forecast for Round 4 due

April 10 Capstone^®; Team Meeting

April 12 Round #5 decisions due, Capstone^®; SWOT due

April 17 Capstone^®; Team Meeting

April 19 Round #6 decisions due, Capstone^®; Sales Forecast for Round 6 due

April 24 Capstone^®; Team Meeting

April 26 Round #7 decisions due, Capstone^®; Sales Forecast for Round 7 due

May 1 Round #8 decisions due

May 3 Accelerated game Round #1 decisions

May 8 Accelerated game Round #2 decisions, Capstone^®; Annual Reports due

May 10 Accelerated game Round #3 decisions

May 15 Accelerated game Round #4 decisions

May 17 Accelerated game Round #5 decisions

Changes to this tentative schedule will be announced in advance.