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MBA Simulation Games 2017 - Winning Guides and Tips (2018 Update 14)

Business Strategy Game - Capsim Capstone Guides and Tips

MBA Simulation Games 2017 - Winning Guides and Tips

MBA SIMULATION GAME WINNING GUIDES AND SUPPORT 

FREE ONLINE SUPPORT FOR 2 ROUNDS

 

MBA Simulations Games Support (2002-2018)

Free Guides and Tips

Free Personal Support for 2 rounds

Videos Explanations for All decisions. 

Free Excel file for Sales Forecast and Production Calculation - LINK 1

Free ALL New Winning Guides and Tips - LINK 2

Online Support for MBA Simulation Games 24/7

Email to: mbahelp2002@gmail.com

 

 

MBA SIMULATION GAME WINNING GUIDES AND SUPPORT 

FREE ONLINE SUPPORT FOR 2 ROUNDS

 

MBA Simulations Games Support (2002-2018)

Free Guides and Tips

Free Personal Support for 2 rounds

Videos Explanations for All decisions. 

Free Excel file for Sales Forecast and Production Calculation - LINK 1

Free ALL New Winning Guides and Tips - LINK 2

Online Support for MBA Simulation Games 24/7

Email to: This email address is being protected from spambots. You need JavaScript enabled to view it.

 

 

Free Online Support - New Updates with step by step and  round by round guides

TIP 01 - R&D 8 Rounds guides - Round by Round Guide from Round 1 to Round 8: 

In order to apply this Round to Round strategy for R&D, we need to create an excel file with your own data from Industry Condition Report and put data in Excel file to get more precise numbers.

Step 1. Download Industry Condition Report (from your game)

Step 2. Download Excel file for automatic calculation strategies and decisions

 

 

2018 - ONLINE SUPPORT

ONE HOUR GUIDE FOR ALL DECISIONS

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Email: This email address is being protected from spambots. You need JavaScript enabled to view it. 

 

Free Excel file for Sales Forecast and Production Calculation - LINK 1

Free ALL New Winning Guides and Tips - LINK 2

 

Step 3. Very important

Open page 2 of Industry Condition Report and get the Table 2, first line for Round 0  and put that numbers in Round 0 in Excel file, then the file will automatically calculate all decisions for 8 rounds, with 4 different STRATEGIES.

DO NOT USE THE DEFAULT numbers in excel file, that is a little bit different from YOUR GAME (creator and administrator change the numbers when new industry is created for new class).

--> Get Round 0 number from Industry Condition Report

--> Put into Excel file, Round 0 (only 1 row) --> Then the file will automatically calculate all the decisions

(Check Drift and Ideal Offsets - 2 last rows of table 1 -  they often do not change for all game)

 

We can download and use the Excel file to calculate Specifications for R&D more easily.

If you have come to this Step. We are started the half way to win the Simulation Game Simulation !!

Again, this Round to Round guides can apply if we start from Round 1.  DO NOT use this suggestions if you are already in the middle of the game, having completion several rounds without this guides. If so, your company may not have enough upgrades and automation to follow this suggested strategy, you can refer to other TIP to Rescue Company or Mid Game Tips.

Now, if you are in Round 1, we can apply this Round to Round Strategy and Win the game.

The numbers are from my game, you need to use your Excel file, numbers will be a little different. If you can not create your file, email: This email address is being protected from spambots. You need JavaScript enabled to view it. - I can create a file for you for FREE.

We use the following strategy for the guides and winning TIP in Round to Round Strategy.

R&D: Research and Development

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

ROUND 1. R&D

  1. Create a new Low End sensor PFMN 4.1 - SIZE 16.3 MTBF 12.000 - this is Low End sweet spot  Year 4
  2. Change original Low End sensor MTBF to 12.000 (don't re-position original Low End)
  3. Re-position original Traditional sensor to PFMN 6.1 SIZE 14.3 MTBF 14.000 (min)
  4. Re-position original High End sensor to PFMN 9.2 SIZE 11.2 MTBF 20.000 (min)
  5. Re-position original Performance sensor to PFMN 9.8 SIZE 16.0 MTBF 27.000 (max)
  6. Re-position original Size sensor to PFMN 4.4 SIZE 10.6 MTBF 16.000 (min)  

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

ROUND 2. R&D

  1. Create a new Traditional sensor PFMN 8.2 - SIZE 12.2 MTBF 14.000 - this is sweet spot for Traditional Year 4
  2. Re-position original Traditional sensor to PFMN 6.8 SIZE 13.6 - Keep 14.000 (min)
  3. Re-position original High End sensor to PFMN 10.1 SIZE 10.3 - Keep MTBF 20.000 (min)
  4. Re-position original Performance sensor to PFMN 10.8 SIZE 15.3 - Keep MTBF 27.000 (max)
  5. Re-position original Size sensor to PFMN 5.1 SIZE 9.6 MTBF - Keep MTBF 16.000 (min)  

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

ROUND 3. R&D

  1. Create a new High End sensor eg. PFMN 11.9 - SIZE 8.5 - this is High End sweet spot Year 4
  2. (Optional) Create a new Size or Performance instead of High End (with round 4 sweet spot specifications)
  3. (Optional) Re-position original Performance and Size sensor ONLY if you plan to continue them (with round 3 sweet spots specification - see above table).
  4. Re-position original High End sensor to PFMN 11.0 SIZE 9.4 - Keep MTBF 20.000 (min)
  5. Re-position original Low End sensor to PFMN 4.1 SIZE 16.3 - Keep MTFB 12.0000 (this takes more than a year to complete)
  6. Re-position original Traditional sensor to PFMN 7.5 SIZE 12.9 - Keep MTBF 16.000 (min)  

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

So, for 3 first Rounds, we create new Low End, Traditional and High End each Round.

We can also stop Performance and Size (we will do that by lower Promo and Sales budget to 0 in Marketing and Production).

 

ROUND 4. R&D

  1. Re-position original Traditional sensor to PFMN 8.2 SIZE 12.2 - Keep MTBF 14.000 (min)
  2. Re-position original High End sensor to PFMN 11.9 SIZE 8.5 MTBF 20.000 (min)
  3. (Optional) Re-position original Performance and Size sensors only if we plan to continue them (use round 4 sweet sport from above table).  

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

ROUND 5. R&D

  1. Re-position both Traditional sensors to PFMN 8.9 SIZE 11.5 - Keep MTBF 14.000 (min)
  2. Re-position both High End sensors to PFMN 12.8 SIZE 7.6 - Keep MTBF 20.000 (min)
  3. (Optional) Re-position original Performance and Size sensors only if we plan to continue them (use round 5 sweet sport from above table).   

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

ROUND 6. R&D

  1. Re-position both Traditional sensors to PFMN 9.6 SIZE 10.8 - Keep MTBF 14.000 (min)
  2. Re-position both High End sensors to PFMN 13.7 SIZE 6.7 - Keep MTBF 20.000 (min)
  3. (Optional) Re-position original Performance and Size sensors only if we plan to continue them (use round 6 sweet sport from above table).   

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

ROUND 7. R&D

  1. Re-position both Traditional sensors to PFMN 10.3 SIZE 10.1 - Keep MTBF 14.000 (min)
  2. Re-position both High End sensors to PFMN 14.6 SIZE 5.8 - Keep MTBF 20.000 (min)
  3. (Optional) Re-position original Performance and Size sensors only if we plan to continue them (use round 7 sweet sport from above table).   

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

ROUND 8. R&D

  1. Re-position both Traditional sensors to PFMN 11.0 SIZE 9.4 - Keep MTBF 14.000 (min)
  2. Re-position both High End sensors to PFMN 11.5 SIZE 4.9 - Keep MTBF 20.000 (min)
  3. (Optional) Re-position original Performance and Size sensors only if we plan to continue them (use round 8 sweet sport from above table).   

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

TIPS: Lower MTBF to the minimum of the range (except Performance segment only)

From Round 1 to Round 8, for all the rounds, when we do R&D, we should lower MTBF to the minimum of the range in order to save cost and increase contribution margins.

The is the key Profit Driving tool since Reliability only accounts for small percentages of the Customer Buying Criteria (see all the 5 segments to see details, in Capstone Courier Report every year, page 5-9).

Note: If we want safe strategies, keep MTBF as average.

Except only Performance segment, we keep that max MTBF at 27.000, for all the other 4 segments, we select minimum MTBF eg. Traditional to 14.000, Low End to 12.000, High End to 20.000 and Size to 16.000

We set MTBF for Performance to max 27.000 because buying criteria for this segment is 43%. See following figure.

Again, the numbers for each Industry is changed when game created for different class or group, so we need to check the number from Industry Report and Capstone Courier every round (year).

If we want to compete is 3-4 segments (not all 5), the two most potential and profitable are Low End and Tradition.

They are most potential lucrative.

We need to read reports for Round 1, Round 2 and Round 3 and then in Round 3 and 4 we will select to leave 1 or 2 least competitive which have least profit.

Creating 1 new segment, eg. Low End is good (often in Round 1)

Creating 2 new segments, eg. Low End and Traditional will provide more Profits in later Round, eg. 5-6-7 and 8. (Often we create New Traditional in Round 2)

In Round 3, we can create new High End segment (more profitable). However, if we see strong competition in High End, we should create new segment in SIZE (better than Performance - high cost).

 

TIPS: Re-position Low End sensor for only ONE time in Year 3

The original Low End sensor should only be re-positioned once for the entire game, not to the Ideal Spot. 

The Traditional segment sweet spot is the same with Ideal, Drift spots because Ideal Offsets is 0-0 for this segment.

The High End, Performance, and Size segments have sweet spots half way from Drift to Ideal Sport. We can use excel file to calculate (download at the end of this article).

Note: If Sweet spot with half way cost too much and too long time to R&D, we can select strategy 4 with 1/3 way from Drift to Ideal spots.

We upgrade original Low End only one time for the entire game, upgrade in Year 3 with specification of Year 4 Sweet Spot (PFMN 4.1 - SIZE 16.3 or PFMN 4.9 - SIZE 15.5) - The new Low End segment will be created in Year 1 with Sweet Spot specification of Year 4.

Note that all figures to input in your game is different from this articles, you should get number from Industry report, put 1 line in Excel file and get your own game figures. Just input in only Round 0 - Strategy 1 --> Then all tables will be updated.

See the table bellow for details.

Note: if any products which do not require Age as 0-1 year, we do not have to update every year, we can update to Pfmn and Size of 2-3 years later. Then the products can meet requirement better and sell better.

------

So, when we start Simulation Game 2017, we can have 4 options or 4 different strategies.

Option 1. Follow Drift suggested from Industry Condition Report (each Industry is different from others

We can use the Excel file to calculate Specifications for R&D more easily.

WE NEED TO INPUT FIRST LINE (ROUND 0) WITH SPECIFIC NUMBERS FROM INDUSTRY CONDITION REPORT OF YOUR OWN INDUSTRY (THIS LINE LOOK FAMILIAR BUT THEY ARE DIFFERENT FROM ANY GAME TO GAME, CLASS TO CLASS).

The segment circle drift rates is the 2nd bottom line (Note to get data from Your Industry Condition report to Excel file)

The segment Ideal Spot Offset is the bottom line (Note to get from Your Industry Condition report to Excel file)

If we follow this strategy, our products are up to date but not very competitive, because most of competitors try to upgrade toward Ideal Sport which is much better specifications.

 

Option 2. Follow Drift plus Ideal Spot Offsets suggested from Industry Condition Report (each Industry is different from others)

This strategy is the Highest upgrade specification, therefore, it often cost too much and takes too long time for R&D.

Also, this specification is too good, (ideal), so, we often out of stock, we can not produce enough to sell to market.

Then, we get less Profit.

 

If should not follow strategy 2, it is too much advance in R&D and it cost too much time and money.

 

OPTION 3. Half way from Drift to Ideal Spot Specification.

 

OPTION 4. One third way from Drift to Ideal Spot Specification

We often start with Strategy 4 or 3 above. It is the best way to get Profit and also Competitiveness at the same time.

 

 

NOTE: R&D Specifications and Revision Date

Make sure that  R&D projects complete in the same year, before 31st December same year, or we can not sell new products in the year.

If we can not upgrade products as our plan, we can try as close as possible, it is important that new products are launched in the year, from June to July. Some may say, 26th June for example.

There are 2 exceptions to this rule:

1. Creating a new Product can take longer than a year

2. Upgrading Original Low End sensor for only 1 time in Round 3 will take longer than 1 year.

Note that, as long as new products are not ready, old versions are still being sold  with old specifications.

If new product is ready in November 30, we have only 1 month to sell them, so we will not get much profits from this new R&D.

We need to create a base for our strategy, we can use excel file like this - LINK TO FILE 

NOTE: Numbers for the first line is taken from Industry Condition Report. Each Industry has DIFFERENT starting numbers, so, we need to input these Specification in the excel file to create our own STRATEGIES.

We need to download Industry Condition Report from our own game to create plan for all rounds ahead.

Note to put Specification of your own Industry in to this line in excel files. We need to put that in one line only, other lines will be automatically calculated for all 8 rounds to Drift spots, Ideal spots and all 50% to sweet spots.

Check all the figures carefully to make sure we are setting plan with correct numbers from Industry Report. Also, we check with report after each round to adjust Pfmn and Size for each product after each round.  


We can set 1 or 2 or 3 different strategies.

Strategy 1. Increase specifications with Drift Rates

Strategy 2. Increase specifications with Drift Rates and Ideal Offsets.

Strategy 3. Increase specifications with Drift Rates and 1/3 Ideal Offsets (+30%)

Strategy 4. Increase specifications with Drift Rates and 1/2 Ideal Offsets (+50%)

We can also follow different strategies to win the game, with high Net Profit, high Market share, and other Financial factors including ROE, ROA.

 

TIP. Add or change specification each round depending on Time to launch, should be in June and July same year so we have enough time to sell new products.

TIP. This tip is quite sophisticated, if we find a product with 2-3-4 years of age, we do not have to upgrade every round, so we can upgrade 1 time for a few years ahead, eg. Low End product, we can upgrade 1-2 times only.

TIP 02 - MARKETING - 8 Rounds guides - Round by Round Guide from Round 1 to Round 8

 

Apply  $2.000 for promotion and sales budgets for Traditional and Low End, because above this level, diminishing returns are experienced.

Apply $1.500 for High End, Performance and Size segments.

Keep this spending from Round 1 to Round 3, until we can decide which segments we will continue. Then, we increase all segments to $2.000 to compete. 

For segments, we do not want to continue, for example Performance or Size, we reduce budgets for that segment to only $0.

Eg. PRICE $35

Promo Budget: 1.500

Sales Budget: 1.500

Forecast: 1.580

This is for basic Marketing decisions. 

For Promotion, we continue $ 2.000 until we reach 100% awareness. Then we can cut it back to $ 1.400 per round.

For Sales, we continue $ 2.000 until we reach 100% accessibility. Then we can scale back to $ 1.650 for each sensors.

TIPS:
We can increase much higher, or even max, to see how much awareness and accessibility we can get, just click CALCULATION button to see how much we get for that year. Then we can increase or decrease spending to get 100%.

NOTE:

Budget for sales, accessibility for multiple sensors in a segment, they are combine together.

See figures in followings:

We can adjust the percentage to focus on products we want to promote more than the others.

 

PRICING

Each round we can lower all prices down at least $ 0.50 from maximum price of the segment to keep up with customer expectation (lower each year)

We can create in excel file a table for Prices to keep track of lowering prices every year - LINK

We need to check from Capstone Courier Prices (from page 5 to page 9) to see max prices for each segment, in the top product at the end of each page

If competitors are cutting prices in Traditional and Low End segments, we need to lower prices to close to their levels.

However, when competitors lower their prices too much, they will not have enough capacity to sell, also they suffer stock out.

We can still keep prices higher and get market shares at higher profit level. This is why we need to calculate demands and plan production as precisely as we can.

NOTE

We DO NOT have to compete with prices in High End, Size and Performance, because buying criteria is low, only 9 - 19%

 

SALES FORECASTING

Do not trust computer suggestions, they always wrong.

We have a formula to calculate and forecast sales for next round

1. Get Market shares from Page 10 of Courier Report

2. Get Total Sales also from Page 10 

3. Get Market potential growth for each segment from page 5 to 9 

Sales forecast = Potential market share % x Segment size x (1 + Segment Growth Rate).

Note:

Page 10 gives us Potential Market share, we use this (do not use actual market share)

If we think we can sell more, we can just adjust the percentage.

Note:

We can use Excel file to calculate more conveniently. Use 8 sheets for 8 round, just copy and paste number from Courier Report Page 10, Page 4 and select market growth rate from page 5-9 into each sheet. We can get Sales Forecast and also Production.

Download the Excel file from here - LINK

If you need help, we can create a file for you for FREE - email: This email address is being protected from spambots. You need JavaScript enabled to view it. 

See figure

NOTE: Use potential market share (RIGHT Column) to calculate and forecast sales.

 

NOTE

You can copy and paste into excel file, then it can calculate automatically Sales and Productions. You can adjust the percentage if we think we can sell more or less.

Tip:
We can add 500 products for newly added products, they often sell well because of high Pfmn and smaller size than expected. And, increasing capacity every round for new products. We need to add capacity and automation to new product right from the year of R&D so that we can have new capacity to produce as soon as the R&D in completed.

 

 

TIP 3 - Re-position Low End sensor for only ONE time in Year 3

The original Low End sensor should only be re-positioned once for the entire game, not to the Ideal Spot. 

The Traditional segment sweet spot is the same with Ideal, Drift spots because Ideal Offsets is 0-0 for this segment.

The High End, Performance, and Size segments have sweet spots half way from Drift to Ideal Sport. We can use excel file to calculate (download at the end of this article).

Note: If Sweet spot with half way cost too much and too long time to R&D, we can select strategy 4 with 1/3 way from Drift to Ideal spots.

We upgrade original Low End only one time for the entire game, upgrade in Year 3 with specification of Year 4 Sweet Spot (PFMN 4.1 - SIZE 16.3 or PFMN 4.9 - SIZE 15.5) - The new Low End segment will be created in Year 1 with Sweet Spot specification of Year 4.

Note that all figures to input in your game is different from this articles, you should get number from Industry report, put 1 line in Excel file and get your own game figures. Just input in only Round 0 - Strategy 1 --> Then all tables will be updated.

See the table bellow for details.

 

 

TIP 4 - Lower MTBF to the minimum of the range (except Performance segment only)

From Round 1 to Round 8, for all the rounds, when we do R&D, we should lower MTBF to the minimum of the range in order to save cost and increase contribution margins.

The is the key Profit Driving tool since Reliability only accounts for small percentages of the Customer Buying Criteria (see all the 5 segments to see details, in simulation Courier Report every year, page 5-9).

Except only Performance segment, we keep that max MTBF at 27.000, for all the other 4 segments, we select minimum MTBF eg. Traditional to 14.000, Low End to 12.000, High End to 20.000 and Size to 16.000

We set MTBF for Performance to max 27.000 because buying criteria for this segment is 43%. See following figure.

Again, the numbers for each Industry is changed when game created for different class or group, so we need to check the number from Industry Report and simulation Courier every round (year).

 

If we want to compete is 3-4 segments (not all 5), the two most potential and profitable are Low End and Tradition.

They are most potential lucrative.

We need to read reports for Round 1, Round 2 and Round 3 and then in Round 3 and 4 we will select to leave 1 or 2 least competitive which have least profit.

Creating 1 new segment, eg. Low End is good (often in Round 1)

Creating 2 new segments, eg. Low End and Traditional will provide more Profits in later Round, eg. 5-6-7 and 8. (Often we create New Traditional in Round 2)

 

In Round 3, we can create new High End segment (more profitable). However, if we see strong competition in High End, we should create new segment in SIZE (better than Performance - high cost).

 

------

So, when we start simulation 2017, we can have 4 options or 4 different strategies.

Option 1. Follow Drift suggested from Industry Condition Report (each Industry is different from others

We can use the Excel file to calculate Specifications for R&D more easily.

WE NEED TO INPUT FIRST LINE (ROUND 0) WITH SPECIFIC NUMBERS FROM INDUSTRY CONDITION REPORT OF YOUR OWN INDUSTRY (THIS LINE LOOK FAMILIAR BUT THEY ARE DIFFERENT FROM ANY GAME TO GAME, CLASS TO CLASS).

The segment circle drift rates is the 2nd bottom line (Note to get data from Your Industry Condition report to Excel file)

The segment Ideal Spot Offset is the bottom line (Note to get from Your Industry Condition report to Excel file)

If we follow this strategy, our products are up to date but not very competitive, because most of competitors try to upgrade toward Ideal Sport which is much better specifications.

 

Option 2. Follow Drift plus Ideal Spot Offsets suggested from Industry Condition Report (each Industry is different from others)

This strategy is the Highest upgrade specification, therefore, it often cost too much and takes too long time for R&D.

Also, this specification is too good, (ideal), so, we often out of stock, we can not produce enough to sell to market.

Then, we get less Profit.

 

If should not follow strategy 2, it is too much advance in R&D and it cost too much time and money.

 

OPTION 3. Half way from Drift to Ideal Spot Specification.

 

OPTION 4. One third way from Drift to Ideal Spot Specification

 

We often start with Strategy 4 or 3 above. It is the best way to get Profit and also Competitiveness at the same time.

TIP 5 - R&D 8 Rounds guides - Round by Round Guide from Round 1 to Round 8

Note: 

In order to apply this Round to Round strategy for R&D, we need to create an excel file with your own data from Industry Condition Report and put data in Excel file to get more precise numbers.

Step 1. Download Industry Condition Report (from your game)

Step 2. Download Excel file for automatic calculation strategies and decisions

FREE DOWNLOAD - LINK

Back up link - LINK

 

Step 3. Very important

Open page 2 of Industry Condition Report and get the Table 2, first line for Round 0  and put that numbers in Round 0 in Excel file, then the file will automatically calculate all decisions for 8 rounds, with 4 different STRATEGIES.

DO NOT USE THE DEFAULT numbers in excel file, that is a little bit different from YOUR GAME (creator and administrator change the numbers when new industry is created for new class).

--> Get Round 0 number from Industry Condition Report

--> Put into Excel file, Round 0 (only 1 row) --> Then the file will automatically calculate all the decisions

(Check Drift and Ideal Offsets - 2 last rows of table 1 -  they often do not change for all game)

 

We can use the Excel file to calculate Specifications for R&D more easily.

If you have come to this Step. We are half way win the simulation Simulation !!

Again, this Round to Round guides can apply if we start from Round 1.  DO NOT use this suggestions if you are already in the middle of the game, having completion several rounds without this guides. If so, your company may not have enough upgrades and automation to follow this suggested strategy, you can refer to other TIP to Rescue Company or Mid Game Tips.

Now, if you are in Round 1, we can apply this Round to Round Strategy and Win the game.

The numbers are from my game, you need to use your Excel file, numbers will be a little different. If you can not create your file, email: This email address is being protected from spambots. You need JavaScript enabled to view it. - I can create a file for you for FREE.

We use the following strategy for the guides and winning TIP in Round to Round Strategy.

R&D: Research and Development

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

ROUND 1. R&D

  1. Create a new Low End sensor PFMN 4.1 - SIZE 16.3 MTBF 12.000 - this is Low End sweet spot  Year 4
  2. Change original Low End sensor MTBF to 12.000 (don't re-position original Low End)
  3. Re-position original Traditional sensor to PFMN 6.1 SIZE 14.3 MTBF 14.000 (min)
  4. Re-position original High End sensor to PFMN 9.2 SIZE 11.2 MTBF 20.000 (min)
  5. Re-position original Performance sensor to PFMN 9.8 SIZE 16.0 MTBF 27.000 (max)
  6. Re-position original Size sensor to PFMN 4.4 SIZE 10.6 MTBF 16.000 (min)  

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

ROUND 2. R&D

  1. Create a new Traditional sensor PFMN 8.2 - SIZE 12.2 MTBF 14.000 - this is sweet spot for Traditional Year 4
  2. Re-position original Traditional sensor to PFMN 6.8 SIZE 13.6 - Keep 14.000 (min)
  3. Re-position original High End sensor to PFMN 10.1 SIZE 10.3 - Keep MTBF 20.000 (min)
  4. Re-position original Performance sensor to PFMN 10.8 SIZE 15.3 - Keep MTBF 27.000 (max)
  5. Re-position original Size sensor to PFMN 5.1 SIZE 9.6 MTBF - Keep MTBF 16.000 (min)  

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

ROUND 3. R&D

  1. Create a new High End sensor eg. PFMN 11.9 - SIZE 8.5 - this is High End sweet spot Year 4
  2. (Optional) Create a new Size or Performance instead of High End (with round 4 sweet spot specifications)
  3. (Optional) Re-position original Performance and Size sensor ONLY if you plan to continue them (with round 3 sweet spots specification - see above table).
  4. Re-position original High End sensor to PFMN 11.0 SIZE 9.4 - Keep MTBF 20.000 (min)
  5. Re-position original Low End sensor to PFMN 4.1 SIZE 16.3 - Keep MTFB 12.0000 (this takes more than a year to complete)
  6. Re-position original Traditional sensor to PFMN 7.5 SIZE 12.9 - Keep MTBF 16.000 (min)  

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

So, for 3 first Rounds, we create new Low End, Traditional and High End each Round.

We can also stop Performance and Size (we will do that by lower Promo and Sales budget to 0 in Marketing and Production).

 

ROUND 4. R&D

  1. Re-position original Traditional sensor to PFMN 8.2 SIZE 12.2 - Keep MTBF 14.000 (min)
  2. Re-position original High End sensor to PFMN 11.9 SIZE 8.5 MTBF 20.000 (min)
  3. (Optional) Re-position original Performance and Size sensors only if we plan to continue them (use round 4 sweet sport from above table).  

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

ROUND 5. R&D

  1. Re-position both Traditional sensors to PFMN 8.9 SIZE 11.5 - Keep MTBF 14.000 (min)
  2. Re-position both High End sensors to PFMN 12.8 SIZE 7.6 - Keep MTBF 20.000 (min)
  3. (Optional) Re-position original Performance and Size sensors only if we plan to continue them (use round 5 sweet sport from above table).   

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

ROUND 6. R&D

  1. Re-position both Traditional sensors to PFMN 9.6 SIZE 10.8 - Keep MTBF 14.000 (min)
  2. Re-position both High End sensors to PFMN 13.7 SIZE 6.7 - Keep MTBF 20.000 (min)
  3. (Optional) Re-position original Performance and Size sensors only if we plan to continue them (use round 6 sweet sport from above table).   

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

ROUND 7. R&D

  1. Re-position both Traditional sensors to PFMN 10.3 SIZE 10.1 - Keep MTBF 14.000 (min)
  2. Re-position both High End sensors to PFMN 14.6 SIZE 5.8 - Keep MTBF 20.000 (min)
  3. (Optional) Re-position original Performance and Size sensors only if we plan to continue them (use round 7 sweet sport from above table).   

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

ROUND 8. R&D

  1. Re-position both Traditional sensors to PFMN 11.0 SIZE 9.4 - Keep MTBF 14.000 (min)
  2. Re-position both High End sensors to PFMN 11.5 SIZE 4.9 - Keep MTBF 20.000 (min)
  3. (Optional) Re-position original Performance and Size sensors only if we plan to continue them (use round 8 sweet sport from above table).   

Note: You need to adjust the number of PFMN and SIZE to get new product launch in June or July.

 

 

TIP 6 - MARKETING - 8 Rounds guides - Round by Round Guide from Round 1 to Round 8

 

 

Apply  $2.000 for promotion and sales budgets for Traditional and Low End, because above this level, diminishing returns are experienced.

Apply $1.500 for High End, Performance and Size segments.

Keep this spending from Round 1 to Round 3, until we can decide which segments we will continue. Then, we increase all segments to $2.000 to compete. 

For segments, we do not want to continue, for example Performance or Size, we reduce budgets for that segment to only $0.

 

For Promotion, we continue $ 2.000 until we reach 100% awareness. Then we can cut it back to $ 1.400 per round.

For Sales, we continue $ 2.000 until we reach 100% accessibility. Then we can scale back to $ 1.650 for each sensors.

TIPS:
We can increase much higher, or even max, to see how much awareness and accessibility we can get, just click CALCULATION button to see how much we get for that year. Then we can increase or decrease spending to get 100%.

NOTE:

Budget for sales, accessibility for multiple sensors in a segment, they are combine together.

See figures in followings:

 

PRICING

Each round we can lower all prices down at least $ 0.50 from maximum price of the segment to keep up with customer expectation (lower each year)

We can create in excel file a table for Prices to keep track of lowering prices every year - LINK

We need to check from simulation Courier Prices (from page 5 to page 9) to see max prices for each segment, in the top product at the end of each page

If competitors are cutting prices in Traditional and Low End segments, we need to lower prices to close to their levels.

However, when competitors lower their prices too much, they will not have enough capacity to sell, also they suffer stock out.

We can still keep prices higher and get market shares at higher profit level. This is why we need to calculate demands and plan production as precisely as we can.

NOTE

We DO NOT have to compete with prices in High End, Size and Performance, because buying criteria is low, only 9 - 19%

 

SALES FORECASTING

Do not trust computer suggestions, they always wrong.

We have a formula to calculate and forecast sales for next round

1. Get Market shares from Page 10 of Courier Report

2. Get Total Sales also from Page 10 

3. Get Market potential growth for each segment from page 5 to 9 

Sales forecast = Potential market share % x Segment size x (1 + Segment Growth Rate).

Note:

Page 10 gives us Potential Market share, we use this (do not use actual market share)

If we think we can sell more, we can just adjust the percentage.

Note:

We can use Excel file to calculate more conveniently. Use 8 sheets for 8 round, just copy and paste number from Courier Report Page 10, Page 4 and select market growth rate from page 5-9 into each sheet. We can get Sales Forecast and also Production.

Download the Excel file from here - LINK

If you need help, we can create a file for you for FREE - email: This email address is being protected from spambots. You need JavaScript enabled to view it.

See figur

NOTE: Use potential market share (RIGHT Column) to calculate and forecast sales.

 

NOTE

You can copy and paste into excel file, then it can calculate automatically Sales and Productions. You can adjust the percentage if we think we can sell more or less.

TIP 7 - MARKETING - 8 Round by Round Guide from Round 1 to Round 8

 

MARKETING - Round by Round Decisions

 

Round 1 - Marketing

  1. Leave A/R lag (Account Receivable) at 30 days, this will be increased later rounds to get higher demands when we have more profits and more cash available.
  2. Leave A/P lag (Account Payable) at 30 days. This is always stay at 30 days for all 8 rounds
  3. Set Promotion and Sales budgets both for $2.000 for Traditional and Low End sensors
  4. Set Promotion and Sales budgets all for $1.500 for High End, Performance and Size
  5. Lower all prices at least $0.50 as indicated in the excel table or check from Courier Report for max price for that segment last year
  6. USE THE SALE FORMULA or EXCEL FILE to calculate sales forecast and production - LINK 

(Note: This round we create a new Low End sensor in R&D)

 

Round 2 - Marketing

  1. Expect the new Low End sensor to sell about 0.2 x original Low End sensor market share
  2. Leave A/P lag (Account Payable) at 30 days. This is always stay at 30 days for all 8 rounds
  3. Set Promotion and Sales budgets both for $2.000 for Traditional and Low End sensors
  4. Set Promotion and Sales budgets all for $1.500 for High End, Performance and Size
  5. Lower all prices at least $0.50 as indicated in the excel table or check from Courier Report for max price for that segment last year
  6. USE THE SALE FORMULA or EXCEL FILE to calculate sales forecast and production - LINK 

(Note: This round we create a new Traditional sensor in R&D)

 

Round 3 - Marketing

  1. If we decide to exit a segment, such as Size or Performance, keep the Promotion and Sales budgets at $0.
  2. What ever segments we decide to stay, increase Promotion and Sales to $2.000
  3. Expect new Traditional sensor to sell about 0.3 x original Traditional sensor market share.
  4. Lower all prices at least $0.50 as indicated in the excel table or check from Courier Report for max price for that segment last year
  5. USE THE SALE FORMULA or EXCEL FILE to calculate sales forecast and production - LINK 

(Note: This round we create a new High End sensor in R&D)

 

Round 4 - Marketing

  1. Increase A/R Lag (Account Receivable) to 46 days, this helps to increase demands
  2. Once 100% awareness is reached for a sensor, in any round, we can scale back to $1.400 but need to check if can that budget maintain 100% awareness.
  3. Expect new High End sensor to sell about 0.75 x original High End sensor market share.
  4. Lower all prices at least $0.50 as indicated in the excel table or check from Courier Report for max price for that segment last year
  5. USE THE SALE FORMULA or EXCEL FILE to calculate sales forecast and production - LINK 

(Note: This round we exit segments because we have reduced Promo and Sales budgets to $0 also we have reduce Production capacity to only 1)

 

Round 5 - Marketing

  1. Increase A/R Lag (Account Receivable) to 61 days, this helps to increase demands
  2. Note to add new market shares for new developed products, check in page 10 simulation Courier.
  3. Lower all prices at least $0.50 as indicated in the excel table or check from Courier Report for max price for that segment last year
  4. USE THE SALE FORMULA or EXCEL FILE to calculate sales forecast and production - LINK 

 

Round 6 to 8 - Marketing

  1. Note to add new market shares for new developed products, check in page 10 simulation Courier.
  2. Once 100% accessibility is reached for a segment (in any round) we can scale back the Sales budget t $1.650 for each segment to maintain 100% accessibility. Note to adjust and then check the graphs at the end of the market table.
  3. Lower all prices at least $0.50 as indicated in the excel table or check from Courier Report for max price for that segment last year
  4. USE THE SALE FORMULA or EXCEL FILE to calculate sales forecast and production - LINK 

 

------

TIP 8 - PRODUCTION - 8 Round by Round Guide from Round 1 to Round 8

Note to check Workforce needed and Workforce complement, if the box is editable, make sure to match the needed with This Year to save money. Otherwise we waste money.

We will increase automation every round.

Traditional to 8.0 (4.0 - 5.0 - 6. 0 - 7.0 - 8.0)

Low End to 10.0 (5.0 - 6.7 - 8.4 - 10)

High End to 5.0

Performance to 6.0

Size to 6.0

 

SETTING PRODUCTION 

Production amounts should always be 112% of Sales Forecast.

This allow some extra inventory to take advantage of competitors suffer from stock out. This often happens.

When we calculate production, we need to take in to account inventory from previous round. 

We can use excel file to calculate PRODUCTION more conveniently - LINK

If we see that year we have Stock out, we can increase production more than 112% to 120% or even 125%. If we see some inventory, we can reduce for that segment back to 112%.

ADDING MORE CAPACITY

Our goal is to keep our plant production at 150% (full first shift and 50% second shift).

This allows more flexibility to deal with short term market changes.

Remember that added capacity isn't available until next round. So if we add capacity in round 2, it will be available in round 3.

If we see any factory with more than 150% capacity, we can add more capacity to that, just simply multiple the excess over 150% with total capacity. For example 180% of 2.000 factory, we will add 30% surplus = 30% x 2.000 = 600

NOTE:

We do not sell factories, even we are not using 100% at the current round.

NOTE:

We only reduce the segments we want to exit to 1. By doing so, we can still sell the rest of inventories in that segment at full price, not 50% price.

 

TIP 9 - PRODUCTION - 8 Round by Round Strategy

If we can not complete all suggestion, try to come as close as possible.

Try to use all the budget available in the first 3 rounds and more if possible

The KEY to win simulation is to control Automation as early as possible. The more automation is better.

Round 1 - Production

  1. Upgrade original Low End sensor from 5.0 to 6.7 automation
  2. Upgrade original Traditional sensor from 4.0 to 5.0 automation
  3. Create 500 capacity with automation 5.0 for the new Low End sensor
  4. Add extra capacity for original Low End sensor

NOTE: check the bottom right corner to see if we use close to total available budget.

 

Round 2 - Production

  1. Upgrade original Low End sensor from 6.7 to 8.4 automation
  2. Upgrade original Traditional sensor from 5.0 to 6.0 automation
  3. Create 500 capacity with automation 5.0 for the new Traditional sensor
  4. Upgrade new Low End sensor from 5.0 to right 8.4 automation.
  5. Add extra capacity for original Low End sensor

NOTE: check the bottom right corner to see if we use close to total available budget.

 

Round 3 - Production

  1. Upgrade original Low End sensor from 8.4 to 10.0 automation
  2. Upgrade new Low End sensor from 8.4 to 10.0 automation.
  3. Upgrade original Traditional sensor from 6.0 to 7.0 automation
  4. Upgrade new Traditional sensor from 5.0 right to 7.0 automation
  5. Create 400 capacity with automation 3.0 for the new High End sensor
  6. Add extra capacity for new Low End sensor
  7. Add extra capacity for original Low End sensor

NOTE: check the bottom right corner to see if we use close to total available budget.

 

Round 4 - Production

  1. Upgrade original Traditional sensor from 7.0 to 8.0 automation
  2. Upgrade new Traditional sensor from 7.0 to 8.0 automation
  3. (Optional) Reduce Capacity for segments that are being exited, such as Performance and Size
  4. Upgrade original High End sensor from 3.0 to 4.0 automation
  5. Upgrade new High End sensor from 3.0 to 4.0 automation
  6. Add extra capacity for all needed sensors

NOTE: check the bottom right corner to see if we use close to total available budget.

 

Round 5 - Production

  1. Upgrade original High End sensor from 4.0 to 5.0 automation
  2. Upgrade new High End sensor from 4.0 to 5.0 automation
  3. (Optional) Reduce Capacity for segments that are being exited, such as Performance and Size
  4. Add extra capacity for new High End sensor
  5. Add extra capacity for all needed sensors

NOTE: check the bottom right corner to see if we use close to total available budget.

 

Round 6 and 7 - Production

  1. Add extra capacity for all needed sensors

 

Round 8 - Production

  1. Last round of the game, do not add any capacity or automation !!

TIP 10 - HUMAN RESOURCES DECISIONS

It is important to invest in HR because productivity is measured in the Balanced Score Card and also this investment will reduce labor costs.

Usually HR has a few options available are Recruiting Spending, Training Hours 

Aim for the maximum of $5.000 recruitment spending and 80 hours training every round.

If you have limited funds, try $2.000 and 40 hours training.

If the Labor negotiations are available, we can use half way, win - win strategy, between demanded and current contract. 

NOTE:

when input number here, double check to make sure correct numbers and avoid labor strikes.

We often use half way for negotiations, average of current contract and labor demands.

 

 

TIP 11 - TQM/Sustainability RESOURCES DECISIONS

In TQM focus on setting $1.500 to $2.000 per round for each item, select the most useful initiatives first. Continue this for three round and then stop spending money into that initiatives, because it will no longer make any significant changes. We can see this from graphs at the end of screen.

NOTE

$5.000 is the maximum budget for each initiative for the whole game.

Optimal way to add money is $2.000 - $2.000 and $1.000 or $1.500 - $1.500 and $1.000 depends on maximum allowed for each round.

Priority order for TQM initiative benefits:

  1. Reduce material costs
  2. Reduce labor costs
  3. Reduce R&D costs
  4. Increase demands
  5. Reduce SG&A expense

There are generally the best initiatives to put money in first:

  1. CCE/6 Sigma Training
  2. GEMI TQEM Sustainability
  3. CPI Systems
  4. Vendor /JIT
  5. QIT
  6. QFDE

We can apply try with different initiatives to see which one will bring more effects or most effective. Then in later rounds, we spend money in less effective initiatives when we have more extra money.

We can see the suggestions in the following tables.

 

TIP 12 - FINANCE

Finance should always be the last decision we make after all the other section decisions have been made.

How we make decisions in Finance depends on How the game will be graded.

Most groups are graded on the Balanced Scorecard.

Some groups are graded on Profit or Stock Price.

FOR ALL GRADING METRICS.

We can keep at least $16.000 (000) cash for a round to avoid emergency loans.

We can keep more cash, it is always better than lack of cash.

We need to keep right amount of cash to get MAX   Days of Working Capital (not too much, not too little).

When we have much Cash and Net Profit, we need to pay off dividends and retire stocks to increase Leverage and also get max points for Days of Working Capital.

 

 

 

We need to create a base for our strategy, we can use excel file like this - LINK TO FILE 

NOTE: Numbers for the first line is taken from Industry Condition Report. Each Industry has DIFFERENT starting numbers, so, we need to download Industry Condition Report and input these Specification in the excel file to create our own STRATEGIES (page 2 of 8 from report). Only for Round 0 of STRATEGY 1 - then other cells will be automatically updated.

Note to put Specification of your own Industry in to this line in excel files.

 

 

 

 


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