Transcript Capstone Introduction

WELCOME
To Capstone
®
An Interactive Business Simulation
Why Simulate?
• Risk Free. Innovate and explore alternative
strategies and tactics.
• Big Picture. Decisions and their impacts will
be examined within the context of overall business
operations - across functional boundaries.
• Develop Critical Thinking
Skills. You will analyze, assess, plan, make
decisions, evaluate, and adjust.
• Compresses Time. Several years worth
of decision-making will play out during the term.
The Business
• $100M electronic sensor manufacturing firms. All
teams begin with an identical profile.
• Oligopoly - market dominated by handful of firms.
• No outside competitors or product substitutes.
• Benign environment – no recessions, no disruptive
new technologies. Focus on competition.
Markets Defined By
Segments
Performance - 11%
Low End - 31%
Traditional – 32%
Size - 10%
Percentage in dollars
($)
High End - 16%
Introduction To Perceptual Maps
Marketing tool used to depict product positioning. Illustrates how customers
distinguish between products that are similar in nature.
Electronic Sensors
Large
Size
(how big is
the sensor?)
Small
Slow
Fast
Performance
(how sensitive is the sensor, and how fast does
it process data?)
Defines five market segments
There are five
distinct segments of
the market:
•Traditional
•Low End
•High End
•Performance
•Size
The customers in
each segment have
different priorities
and evaluate the
product according to
their own needs.
Large
Low End
Performance
Traditional
Size
Size
High End
Small
Slow
Fast
Performance
Perceptual Map
Segments Differentiated By Name
Large
Low
Pfmn
Trad
Size
Size
High
For example, Low End Segment
customers look for large, slow
sensors, representing nearly
obsolete technology. Their
primary concern is price.
While High End Segment
customers want the latest &
greatest technology. They’re
willing to pay more to get very
small, high performance sensors.
Small
Slow
Fast
Performance
Perceptual Map
Segments drift over time
Large
Low
Trad
Size
Size
Pfmn
High
Customer expectations are
constantly changing. They
expect the sensors to become
smaller in size and better in
performance.
Small
Fast
Slow
Performance
Perceptual Map
Segments drift over time
Large
Low
Trad
Pfmn
Size
Size
High
Small
Fast
Slow
Performance
Perceptual Map
Segments drift over time
Large
Low
Trad
Size
Size
Pfmn
High
Small
Fast
Slow
Performance
Perceptual Map
Customers Go Through a Two-Stage Purchase
Decision Process
Stage 1 - Match Product to Market
1. Product must be positioned within the
segment.
Able
Size
Able
2. Product must fall within
Price
price guidelines.
Performance
Able
Segments
3. Product must fall
Reliability
within reliability guidelines
Segments
Two-Stage Purchase Decision
Stage 2 - Rank Best Product
Position
Reliability
1. Positioning
AB
2. Age
Age
0
Yrs
Ideal
Spot
1
3. Reliability
Price
HIGH END
20000
25000
4. Price
$30
$40
Product Ranking Criteria by Market Segment
Traditional
Segment
Low End
Segment
High End
Segment
Performance Size
Segment
Segment
1 - Age
1 - Price
1 - Position
1 - Reliability
1 - Position
2 - Price
2 - Age
2 - Age
2 - Position
2 - Age
3 - Position
3 - Position
3 - Reliability 3 - Price
3 - Reliability
4 -Reliability
4 - Reliability
4 - Price
4 - Price
4 - Age
Listed in order of importance for each market segment.
Basic Functional Areas
R&D
Production
•Re-position products
•Schedule production
•Launch New Products
•Increase/decrease plant
production capacity
•Set product reliability
rating (MTBF)
•Change automation levels
Basic Marketing
Finance
•Set prices
•Issue/buy-back stock
•Set Promotion budgets
•Set dividend policy
•Set Sales budgets
•Borrow short or long-term
•Input sales forecast
•Pay-down debt
Optional Modules
TQM
Labor Negotiations
Advanced Marketing
HR
Decision Making
•Each firm begins with identical profile
•Decisions are made January 1st each year
•Tactical plan should align with chosen success
measurements (Profit, Stock Price, ROE, ROS,
ROA, Asset Turnover, Market Share, Market
Capitalization)
•Responsibilities may be divided up by Product
Manager, Functional Manager, or Market Segment
Manager roles
•Every member of the firm is able to create and
upload decisions - communication and teamwork is
vital!
Proformas
Created Automatically
in Decision Software
•
•
•
•
Sample Proforma
Income Statement
Balance Sheet
Income Statement
Cash Flow
Financial Ratios
Print Proformas from software after making decisions each round,
then compare to actual results
Student Activity Overview
Each student registers
at www.capsim.com
Personal Web page is
created
Teams compete for up
to eight simulated
years
Wrap-up reports
Introductory
lessons under
“Getting Started”
section heading
on website
Team develops
Strategic Plan (success
measurements)
Celebrate Winners
Team completes
“Situation Analysis”
exercise as a group
Team completes
Practice Round(s)
decisions
Student Resources
• Team Member Guide
• Website
(www.capsim.com)
- Demo’s
- Tutorials
- Help Files
- Round Analysis
- Tech Support Staff
1-888-472-7554 or
[email protected]
Sample Student
Website Page