Section 1 -Introduction 3
Section 2 - Strengths & Weaknesses Analysis 6
Section 3 - Recommendation 9
Section 4 - Implementation 10
A. General Program Guide (Tutorial) 10
B. Class Structure Proposal 21
i. Syllabus Redesign 21
ii. Class Layout 24
iii. Team Set Up and Criteria 26
iv. Constraints and Conditions 27
C. Performance Evaluation 28
Section 5 - Risk Assessments, Evaluation and Control 31
Summary 33
Bibliography 34
Appendices 34
Section 1 - Introduction
In this research project, our objective is to evaluate FoundationTM for possible incorporation as part of future Management 552 "Advanced Strategy and Business Policy" classes. The appropriateness, suitability and viability of including FoundationTM in Management 552 "Advanced Strategy and Business Policy" are considered.
The company which offers products is Management Simulations, Inc. Current situation of (Management Simulations, Inc.) is as follows:
a. Current number of enrolled students = 28,000
b. Current number of universities participating = 400
c. Some of these universities include 15 overseas universities in the following countries:
Turkey, Malaysia, Australia, Netherlands, Canada, Germany, Argentina, Brazil, to mention few. Total of foreign countries is around12. All the games are done in English as the international language.
d. 35% is MBA curriculum.
Foundation™ is a business simulation game where opposing teams run companies competing in the electronic sensor market. Foundation™ takes one product (sensors) and markets it to two global market segments (High-tech and Low-tech). Drawn from real-world situations, Foundation™ focuses on business planning, competitor analysis, cross-functional integration and team building. Each team will experience the impact their decisions have on the company's position and profitability. A winning position can be attributed to a team's good choices or bad tactics by the competitors. The simulation allows teams an opportunity to decide between multiple focused or differentiation strategies. All teams start with an identical position. A team name, and a product name will be provided to each team, beginning with a particular consonant, which should be used when adding new products, as your identification. This business simulation requires the input of decisions based on the information provided in performance reports from the previous year. Each round represents a year. In the Foundation™ business simulation, the increase in market share, price per share, and overall performance are based on five strategic decisions:
Based on the decisions made in the five different strategies, automatic financial calculations are performed by the computer providing your company with the following financial statements for the current year:
Each team can access all the teams' last year reports consisting of
There are several tools provided in the website (http://www.capsim.com) that can be used by the teams in order to communicate with your team through an online team conference, via e-mail to other team members or to the professor. Another excellent tool is that if the team is divided into the different strategies, each team member can upload their own decisions, review the other member's decisions, and then discuss them to reach an agreement. Every time a team member uploads a decision to , an e-mail is sent automatically to the other members of the team.
A helpful tool for the professor is his/her ability to read the team's on-line discussions.
Other tools available include, peer evaluations, tutorials, student records, personality scale, and team developer.
Section 2 - Strengths and Weaknesses Analysis toc
Our team had enrolled in the simulation system, studied the software, website, the team member's manual and had actually run the business simulation for six rounds (business years). We have identified the following strengths and weaknesses:
Strengths:
Weaknesses:
Section 3 - Recommendation TOC
It is clear that this program offers more strengths (pros) than weaknesses (cons), and the merits of the program far outweighs the administrative and logistics concerns to implement this program.
Our team's overall experience and evaluation of the program has been favorable both in terms of benefiting from the features offered by the program and the learning benefits. We derived invaluable information and experiences from evaluating and trying this program.
We recommend trial implementation of this program for the most appropriate future term in Management 552 "Advanced Strategy and Business Policy" replacing the research paper, and have proposed a set of implementation plan along with class organization and performance evaluation.
Section 4 - Implementationtoc
A. General Program Guide (Tutorial):
FoundationTM business simulation sequence can best be laid out as follows for the students:
Step One:
Student Registration
Step Two:
Introductory Tutorials
Complete®; Introduction Lesson provided in the Getting Started area.
Review the animated demonstrations of spreadsheet operations also provided on the welcome screen. The student can choose to download the animated demonstration files and review at his/her leisure. See Appendix A for details.
Step Three:
Situation Analysis
Coordinate specific assignments with each teammate for completion of the analysis exercise detailed in Chapter Four of the Team Member Guide (perceptual map market position analysis, demand analysis, margin analysis, etc.)
Step Four:
Business Plan
Review the student tutorial "How Do We Develop a Business Plan?" (located under the "How To" section of the web menu in Tutorials).
Develop your strategic plan as directed by your professor. Identify your success measurements.
Step Five:
Create 1st Year Business Decisions
Coordinate specific responsibilities with teammates. Use student software to make decisions (review Chapter Five of the Team Member Guide).
Follow instructions in Chapter One of the Team Member Guide for uploading decisions. The professor controls decision deadlines and availability of game results.
Step Six:
Analyze Results
Review the student tutorial "How to Analyze Results."
After 1st year decisions are processed by the professor, analyze results (each team assesses themselves, the competing teams, and look for opportunities).
Step Seven:
Make Subsequent Year Business Decisions
After each round of the game is processed, follow the instructions in Chapter One of the Team Member Guide for downloading new starting conditions, then repeat Step Five and Step Six for creating decisions and analyzing results. The professor decides when the game is over. We recommend to end after the seventh business simulation run.
Step Eight:
Prepare Final Debrief
As instructed by the professor, each team may be required to conduct a briefing for other classmates (acting as the Board of Directors.)
Review the "Stockholders Debrief" worksheet on the Web site in the "How To" menu section under Materials.
The best way to orient the students into the program is for the professor to actually show the class how to run the first round of simulation after Step Two (above.) The web-based tutorials take the student through each phase of decision-making and through the logistics of the decision-making screens. The web site also has a helpful "How Do I?" help menu to guide players through the simulation as questions arise during play. These helpful features allow the professor to encourage the majority of related learning to be done outside the class. For detail downloading and uploading instructions, please refer to Appendix A.
1. Research & Development Strategy:
allows students to revise products (industrial sensors) and develop new ones. Products are assigned size, performance and quality ratings. R & D efforts vary in length and cost, depending on the parameters of the project.
Research and development decisions allow each team to make the following decisions:
After entering a performance level, a size, and the MTBF, a revision date will be calculated by the program to indicate when will this product be available to the market. R&D costs associated with either redesigning an existing, or designing an entirely new product will be calculated by the program. A maximum of $1 million dollars will be charged per year against the current year's Income Statement. If the R&D costs are higher than $1 million dollars, these costs will be charged against the Income Statement the following years.
A perceptual map is provided to indicate the positioning of the team's product(s).
2. Marketing Strategy:
addresses segmentation and positioning, product development, perceptual mapping, customer purchase decision making, and the 4 P's (price, product, promotion and place).
The program will provide you with the following:
3. Production Strategy:
examines capital (automation) versus labor (overtime) tradeoffs, capacity utilization, margin analysis, asset turnover, and product introduction. The production strategy module is divided in three sections:
4. Finance Strategy:
Complete®; produces Balance Sheets, Cash Flow, and Income Statements. It examines capitalization using both stock and bond markets, and explores ratio analysis in detail. The finance module is the final module in which a team can make decisions and/or change decisions made in other modules according to financial capabilities. This module includes:
5. TQM Initiatives Strategy:
TQM comprises Process Management Initiatives and Projected Cumulative Impacts. Some of the initiatives that management and your company has control over are:
B. Class Structure Proposal toc
To implement the program with success, we are proposing a set of redesigned syllabus, a slightly different class layout, with suggestions on how to set up teams for the simulation program, and the constrains and conditions each team will face. Looking at the total number of classes for fall and spring a semester is limited to only 15 meeting periods. Three classes are taken up on the introduction, mid-term and final exam. Three other classes are used for the presentation of strategic audits and project presentations. This leaves enough classes to cover seven sessions of business simulations in the program.
i. Syllabus Redesign toc
Part of the implementation involves the redesign of the syllabus (See Appendix E).
A suggestion of the addition of materials, the simulation description, team requirements, grading procedures, and evaluation policy need to be incorporated into the syllabus is as follows:
Materials:
Foundation, Team Member Guide and accompanying computer diskette which contains all of the programs required to successfully operate the simulation.
Professor's Handouts including:
Strategic Audit Steps
Strategic Management Summary
Material including:
a. Tutorial
b. "Understanding your Team Development Report"
Ordering of Program Material
The cost of the materials is $39.00 per student. The materials can be provided to students in several ways including:
a. Through the bookstore, which of course will charge a markup. JU might opt for this to give the bookstore some business.
b. Through the MBA office in which they would pay when they register on-line without markup.
c. Pay directly to (MSI).
is willing to send materials before hand based on the roster. However, if the roster is composed of 30 students and sends materials for 30, and only 25 students end up the class, will only charge 25 students.
III. BUSINESS SIMULATION DESCRIPTION
Strategy may be defined as the art and science of formulating and implementing plans to achieve specific goals. As a successful manager and business leader you will be required to make intelligent decisions as you help to create and execute your organization's strategic plans. In this business simulation, we will examine the impact of your business decisions as they affect your organization's qualitative and quantitative performance. We will study the criteria for making intelligent choices from the many options available to your company and your competitors. To challenge your verbal, graphic, written, and electronic media communication skills, and to enhance your interpersonal abilities by interacting as a team in an organizational-like setting.
TEAM REQUIREMENTS
The members of the class will be divided into teams of 3 or 4 participants per team. The team will form a "company" that will manage a specific firm within the computer simulation program. Each team will compete against the other class teams in a multi-round sequence of business decisions. The first three rounds will be for practice purposes. After the third round, 5 more rounds will be played and grades will be based on these 5 rounds. Teams will be cross-functional with at least one finance or accounting major, and one marketing major (if possible). Team management is as important as team task accomplishment. Teamwork is an important aspect of this course. Students who, for personal or job-related reasons, are unable to work in teams are advised to consider this factor carefully before taking the course in this semester. Keep in mind that the course involves a considerable number of team meetings and that teams hold most of their meetings outside of the classroom.
In general, the probability that a team will win is dependent upon the following factors:
Boards' Report
Due Date
List of top management team and their roles
By the end of the third round, and at the end of the terms with presentations as the first part of the Board's Report.
Intended Strategies for:
Comparison between emergent strategies and intended strategies
At the end of the term with presentations
Evaluation of company's internal strengths and weaknesses
Competitors' and Market Analysis
How well were inventories and stock outs controlled?
If the company got into trouble, did it make reasonable decisions to overcome the problem?
Description of reasons for strategic decisions made, and how these decisions were implemented
A statement of what was learned from the experience, what worked well, and what your team would do differently in the future
GRADING PROCEDURES
Qualitative & Quantitative Strategic Performance
A. From the Board's Report
B. Team Evaluation Form
C. Financial Performance
EVALUATION POLICY
A final letter grade will be determined by the total number of points accumulated during the term. Maximum point values are as shown below for each major evaluated item.
Business Simulation:
100 points
ii. Class Layout toc
Looking at the limited amount of time provided in class, we have come up with the following breakdown for time distribution needed in class. The initial class will need the majority of time to discuss the basic instructions covering the project. There needs to be a minimum of one hour to run a trial round in the classroom as a demonstration on the fields that students will make decisions on. It will also provide confidence to the students by demonstrating that each individual member can make decisions, change the decisions, and share the decisions, but that the decisions will be implemented after the whole team is in agreement and the final decisions are uploaded in the Internet. There needs to be a minimum of 20 minutes to thoroughly discuss the usefulness and practicality of this project. Through our own experience, this exercise will best minimize information overload, confusion, and enhances curiosity and interests in the teams to see what they can do better. This exercise is an efficiency and effectiveness enhancer: it will streamline and minimize many hurdles in the orientation of the program.
FIRST CLASS BREAK DOWN
THIRD CLASS BREAKDOWN
SECOND, FOURTH - ELEVENTH CLASS BREAKDOWN
TWELTH CLASS - FOURTEENTH CLASS BREAKDOWN
The total amount of time needed during class to adequately cover the instructions and questions regarding this project is two hours total. A suggested term schedule is provided in Appendix F.
iii. Team Setup and Criteria toc
When selecting the team it is crucial to first go around the class and ask for each member of the class to give his or her background and expertise. This can be performed by asking each class member at the beginning of the class to state his name, major and current job title. The students should be informed to team up with two other students in the class with different educational and/or work background. For example, an ideal team would be made up with students that posses a strong marketing background, finance background, and economics background.
This diversification in team selection is ideal for the project, which involves multiple facets of real world requirements in performing the project's requirements. When a team has a diverse background of members, this team will have no problem in completing the tasks set forth by this project. However, when a team is highly concentrated in one aspect of a business, be it marketing, finance, economics, or management, that team will be limited in its knowledge base to perform the tasks set forth by this project.
iv. Constraints and Conditions toc
Looking at the requirements of this project, some students may face certain constraints and conditions that could be helpful to identify before giving this project to the students. Below is a list of constraints and conditions that must be overcome by all students to have a smooth flowing process in performing the requirements of this project.
These two are the main constraints in undertaking this project. As long as these constraints can be met, the groups should not have a problem with completing the requirements set forth by this project.
C. Performance Evaluation TOC
When performing this program, each team is given a star based on five criteria. This evaluation process is one part of the overall performance of the team, but it is not the only measure to accurately judge the performance of the team. Listed below is a complete breakdown of the evaluation process needed to accurately judge the teams' performances.
Suggested parameters to evaluate the overall performance of each team:
Total evaluation process equals 100%
When looking at the project's evaluation of team presentation discussion points the following questions should be kept in mind.
Seven-Year Summary
Section 5 - Risk Assessment, Evaluation and Controltoc
The primary risk associated with implementing this program could be the professor's and students' frustrations associated with the time constraints, technology constraints, and evaluation process. The additional time the professor has to apportion for this program may take away some of the already time consuming class discussions on Strategic Audit requirements. The student's frustrations can be avoided with proper discussion and guidance during the first four meetings of class outlining the expectations from the professor and discussing the obstacles each student may encounter. During this time, any questions or concerns can be overcome as to not allowing for frustration from students to build up.
Another similar risk is associated with additional work scope making harder for the students to take on which may lead to complaints. Under this program, teamwork is very important and it is necessary for all team members to participate equally.
Usually, there is always one or two dominant person(s) who makes all the decisions, and the others just follow, or there is one or two person who is less than willing to contribute to the effort. This will reflect in the team evaluation and is important that all persons in team make decisions.
Risks
Benefits
(Additions to the Strengths Analysis)
Professor's and Student's constraints leading to frustration.
Much better fit as part of Management 552 "Advanced Strategy and Business Policy"
Additional workload leading to complaints.
The program offers excellent near real life business simulation. The students can actually practice and refining on the skills of crafting the vision, mission and strategic plans.
Unequal team participation.
Offers students a broad-spectrum of skill review and application on finance, marketing, economics, and business management.
Could be a better, structured replacement for research project.
While risks exist with the implementation of this program, the benefits and the strengths of the program far out-weighs the risks, and it is apparent that this program is worth trying as long as the following suggested control and evaluation are considered in order to implement this program smoothly.
Control
As the program is introduced, students could have two extreme reactions: Really excited about it, or really overwhelmed by the scope of the program.
The professor would need to encourage and motivate the students who are overwhelmed, while advising the enthused students to process the simulation runs within the program scope and not get too involved on details which could lead to information overload causing eventual frustration.
A careful check and balance should be heeded during each class discussions and to encourage feedbacks on the simulation runs via:
TEAMS
The members of the class will be divided into teams of 3 or 4 participants per team. The team will form a "company" that will manage a specific firm within the computer simulation program. Each team will compete against the other class teams in a multi-round sequence of business decisions. The first three rounds will be for practice purposes. After the third round, 5 more rounds will be played and grades will be based on these 5 rounds. Teams will be cross functional with at least one finance or accounting major, and one marketing major (if possible). Team management is as important as team task accomplishment. Teamwork is an important aspect of this course. Students who, for personal or job-related reasons, are unable to work in teams are advised to consider this factor carefully before taking the course in this semester. Keep in mind that the course involves a considerable number of team meetings and that teams hold most of their meetings outside of the classroom.
In general, the probability that a team will win is dependent upon the following factors
The ability to organize and effective team unit
The extent to which the team understands the "cause and effect" relationships in the specific business environment in which they are operating(dependent and independent variables)
The team's ability to formulate a well defined and relevant strategic plan and then execute that plan within the time-frame of the business model.
Boards' Report
Due Date
List of top management team and their roles
By the end of the third round, and at the end of the terms with presentations as the first part of the Board's Report.
Company's Vision a. Strategic Objectives
b. Description of the product(s) strategies
c. Uniqueness of the company
d. Distinguishable from competitors
Intended Strategies for:
Comparison between emergent strategies and intended strategies At the end of the term with presentations Evaluation of company's internal strengths and weaknesses
Competitors' and Market Analysis
How well were inventories and stock outs controlled?
If the company got into trouble, did it make reasonable decisions to overcome the problem?
Description of reasons for strategic decisions made, and how these decisions were implemented
A statement of what was learned from the experience, what worked well, and what your team would do differently in the future.