Simulation Sample

Contents

Abstract 2

Introduction company’s profile. 3

Vision and strategies. 3

Vision and targets: 3

Strategies: 4

Team players and their responsibilities. 6

Assessment of environment 7

PESTEL model: 8

SWOT analysis: 10

Porter five forces model: 12

Key decisions and performance analysis. 15

Team performance. 17

Personal skill development and learnings. 18

Recommendations and conclusions. 20

References. 22

Abstract

The simulation business activities help to think like a business person and to assume the position of the management and make the decisions accordingly. These activities help to encourage the critical thinking and analytical reasoning skills among the students. This report is prepared on the simulation business game where decisions related to the vision, mission, goals and objectives of the company have to be taken by all the team members. The strategies related to the marketing activities, financing activities, human resource management activities and research and development activities also have to be developed by the team members. Working in the team helps to inculcate Team Spirit and team player skills which cannot be gained through the individual performance. While working in the team, several performance parameters are based on the team work and the engagement of all the team members is necessary.  This report is going to highlight the importance of assessment of the environment in which the business has to operate by making use of several competitive analysis models. Every decision and strategy are based on the extensive market research and assessment of the environment. The key decisions and the analysis of the performance is also depicted in this business report. The simulation activity helps to develop leadership skills and these are discussed in this report in detail.Recommendations are also provided for the improvement of future efforts and the business performance.

Introduction company’s profile

This report is based on the company which is a hypothetical company which is a part of the simulation business game. The company is named “Blud” but the management failed to design a unique logo for the company. The business in which this company is dealing is related to the sports products. It is focusing on mainly four categories under the sports product section. The four categories involve inline skates, ice Hockey sticks, tennis rackets and skateboards. This business is not in the manufacturing business which means the company is not making these products using the raw material in the factories. This is a trading business which is based on buying the finished product from distributors and is selling these products to the final customers. This report is a discussion on the various decisions and strategies implemented in the company and the performance analysis of the company will also be done on various targets and parameters. This simulation activity is full of learnings and these learnings are discussed in this report at length. Many issues and performance gaps due to the lack of coordination and communication among the team members arised throughout this activity which will also be the part of this report(Schröder & Ciucan-Rusu, 2012).

Vision and strategies

Vision and targets: Every business is based on a strong foundation of its vision and all the objectives and targets revolve around the vision statement of the business. Vision is a broader term which is based on the future performance of the company and this is the ultimate goal of the company where the company wants to reach in the long run through its operation and activities. The mission statement describes the possible actions which the company can take in order to achieve its vision and further this mission statement is divided into several objectives and goals. These objectives and goals are achieved through the targets determined in the quantitative terms. The Vision and Mission statement are in the statement form and the targets are measurable in the quantitative terms and are more specific. The company has also set its vision and the vision is related to the performance and satisfaction level of the consumers. This company could not define its Vision and Mission statement in concrete form. However, the company was supposed to set its targets based on the SMART model. This SMART model helps to make the targets specific, measurable in quantitative terms, achievable and action oriented, relevant according to the vision and objectives of the company and time Bond which has to be achieved in a particular set of time. The targets related to the profit generation, cost of production for the trading, sales, quality were set by the company(Ogbeiwi, 2017).

Figure 1: SMART goals

Strategies: Every business is based on strategies. Strategies helps the business to perform its operation and guides the management. Various strategic models are there which can be used in order to develop the strategies.

• Porter’s model is famous to develop a competitive strategy. This model divides the strategy into four groups. The first group talks about the strategy of cost leadership where the company aims to control the costs by reducing the wastage and its main objective is to become the leader in the market by offering the products at the lowest cost possible. The other strategies are related to the differentiation strategies where the focus is on the product differentiation by adding different features in the product in order to attract the customer.
• There are also growth strategies according to the Ansoff matrix. According to this, a company can either focus on existing product and existing market or it can expand its operations by tapping new markets. The company can also choose to tap New Market with the existing product or it can serve the existing market with new products in order to enhance their satisfaction level. This company fails to adopt a particular strategy and also not proper consideration is given to the market research for the setting up of the targets which is a risky situation for the company(Kurt & Zehir, 2016).
• Research and development areanother important role which the management has to look after and every business can be successful through the proper implementation of research and development strategies. These strategies help the business to explore the unexplored and to come up with innovative ideas in the market. These innovative ideas help to stand out among the competitors and the chances of success increases. Customers also like to associate with the brands who are constantly giving proper focus on the research and development activities. However, the company failed to develop an appropriate strategy for the research and development part of the business and made use of general Strategies for all the products which were not appropriate because every product is different and the target market for every product is also different.
• With regard to the policy related to the quality of the product, the company is making use of general policies for all the four categories of the product. Under the quality related decisions, there was a need to consider the method for the quality check on the products. The company is also making use of the same message or the communication for all the four products which is again putting the company into the position of risk(Ilhan & Durmaz, 2015).

Team players and their responsibilities

This simulation activity is based on the team members and it is not an individual. A group of 4 team members is there and each team member is responsible to perform the responsibilities for different decision making and tasks. The team members were required to act as the board of Management and each team member has to take the responsibility of a particular function of the organization. Marketing, financing, production order operation human Resource Management are the main functions of the organization which had to be divided among all the team members. The marketing head is responsible for looking after the decisions related to the marketing function which involves the decisions related to marketing research, marketing strategies, promotional strategies and all these strategies helps to give kick to the sales of the company and an Ultimate boost to the profit it is provided through the marketing strategies. The financing strategies are related to the fundraising and fund management decision. The preparation of financial statements such as balance sheet, cash flow statement and income statement are also a part of finance head. The operational management or the head is responsible for the operations related to the trading and the decisions regarding the supplier or the distributor has to be taken by the operational head. The human resource management is responsible to take the decisions related to the hiring, training, salary fixing of the staff members.

There was a lack of communication and engagement of the team members because of which the functions could not be divided and the responsibilities among the team members could not be delegated. This gap in the delegation of the responsibilities among the team members impacts the overall working of the company because of which the duties and responsibilities could not be segregated between the team members. Given the chance, my interest was related in the marketing field and I would have opted the position for the marketing head of the company. Being the marketing head, I would like to take the decisions in such a manner that more and more customers could have been attracted to the sports products of this company by making use of various promotional tactics.

Assessment of environment

Environmental assessment is a very important task which have to be undertaken by every business in order to make smart decisions and to implement a right strategy. The assessing of the environment means understanding the particular industry and the environment in which that industry has to operate. This helps to gain insight about the factors which are external to the business and which can impact the business growth and strategies(Glenn & Gordon, 2009). The opportunities available to the business can be analyzed through the assessment of the environment and according the business can encash these opportunities through the proactive decision making. The business is also encircled with the number of threads which are external to the business and without knowing about the environment which is surrounding the business, these threats cannot be identified. Once the business becomes aware about these threads, become easier for the business to be prepared to face these Threads and uncertainties. A business has to respond to the external environment and according to the changes that take place in the external environment, it has to adjust its Strategies and decisions. The businesses which fail to respond towards the changes in the external environment, do not get success and cannot survive for the longer time. For this purpose, several models are used by the business(Cancellier et al., 2014).

PESTEL model: This model helps us to analyze the micro environmental factors in the external environment which surrounds the business and according to this analysis, business can frame its Strategies and also alter its strategies from time to time. This is an acronym which stands for political, economic, social, technological, environmental, and legal. Ethical is a new aspect which is also covered these days under this analysis.

SWOT analysis: SWOT analysis is also very useful in order to assess the external environment in which the business is operating. This analysis not only help the business to identify the various opportunities and threats which are belonging to the external marketing environment, but it also helps the business to assess its internal strengths and weaknesses. This is a basic model which helps the business to know more about its internal and external factors which have to be considered by it in order to succeed in the market. This acronym stands for strength, weaknesses, opportunities and threats.

Porter five forces model: Porter’s five forces model is a famous model which can be used for the analysis of the competition. Competition is one of the key factors which has to be identified and it is a part of environmental scanning. Through the environment scanning and analysis, business can identify the various competitive forces and the bargaining powers and accordingly strategies can be modified and developed(Bruijl, 2018).

By performing the environmental scanning, it can be identified that the sports industry is having a high level of bargaining power of suppliers and buyers. The company must be taking decisions related to the selection of supplier and distributor smartly and the marketing decisions should be framed in such a manner that customers can be attracted. The competition in this market is also high because of which continuously innovation is required(Jedel & Antonowicz, 2018).

Key decisions and performance analysis

The key decisions which the company had to make were related to the marketing decisions, purchasing decision, distribution decisions, human resource management decisions, research and development related decision, finance related decisions, marketing research related decisions and some other general decisions. However, the company failed to take appropriate decisions on time and instead of making a specific decision for each product category, it made use of general decision which were common for all the product categories because of which the company failed to produce desirable results. If we observe the different periods price fixation, quality related decision, and other decisions, we can observe that these decisions have not helped the company to perform well. The transportation cost of $14 remained the same for all the product categories in all the periods there was no cost associated with the quality check which clearly depicts that the company is not taking with quality check seriously and no budget is allocated to the quality check. It clearly shows that, the quality aspects of the company are not up to the mark. In all the periods the, the price for all the product categories was also same which means the company was not analyzing the external market and no changes in the strategies and decisions were made by the company. All of these actions, but not in favor of the company’s performance. The ranking of the company also got negatively impacted. In the period 3rd, the company’s ranking was second and by the end of period 8th, the company’s raking dropped to 4th position.

The data shown below in the image clearly shows that the company was not having sufficient current assets till the fifth year of the operations which depicts that the company was lacking working capital for the day-to-day operations, whereas, the income of the company and increased but the increase in the income is not much over these years. In the eighth year, the current ratio is so showing a figure of 22 times, whereas the quick ratio is showing the figure of 2.8 times. This means, the company either has invested too much in the inventory or there are a lot of debtors who have to pay show the company. In other words, the liquid assets in comparison to the other current assets are not much and the company have locked a lot of money in the form of non-liquid current asset which is not good for the company’s position. The increase in the turnover is also very nominal and more or less, it is remaining almost same for all these years. This clearly shows that not much effort or being put by the management in order to push the sales and profitability of the company.

Figure 2: Key data of the company from 1^st to 8^th period

Team performance

Group dynamics are one of the most important aspect for this simulation activity and the success of the simulation business activities based on the teamwork. The team performance was not up to the mark because there were some clashes initially and there was a lack of communication gap which led to non-engagement of the team members in the simulation business activity. This result in not being proactive with regard to the decision-making and strategy building for the company. Naming the company, designing the logo of the company, framing the strategies after Thorough discussion and brainstorming through the help of market research, delegating the duties among the team members, reviewing after decisions and strategies, altering the decisions and strategies through the environmental scanning and communicating with each other important tasks which had to be completed by all of us as a team(Naveenan & Kumar, 2018).

The lack of engagement and communication resulted in in poor performance of the company because the vision of the company and its core values were not clearly defined. The decisions related to the marketing, human Resource Management, financing decision, research and Development Association, marketing research, distribution related decision, general decisions were not being taken effectively by the team members. Even, most of the decisions were overlooked by the team members, including me because of which the performance of the company deteriorated.

Personal skill development and learnings

This simulation activity helped me in several ways and the gaps which were there because of the lack of team spirit and team engagement also helped me to learn. Basically, I learnt from my mistakes to a great deal in this activity. Initially, some time was wasted by me because there were some communication gaps and engagement issues with the team members because of which responsibilities could not be divided among all of us. After putting some more effort which was in vain to get involved with the team members and to give best for this business activity, I started working individually on my concept related to the business simulation activity and I started developing my own skills and competencies(Maccallum & Casey, 2017).

• I tried to understand the different strategies which have to be followed by the businesses. The importance of competition analysis and the environmental scanning was realized by me while I was doing my research. There are many models on the environment analysis and competition analysis, such as PESTEL model, Porter’s five forces model which helps to analyze the external marketing environment and to identify the various opportunities and threats to the business. While I was going through these concepts and theory, I could relate each and every parameter to the sports industry. I identified that the sports industry is growing because of the increasing health awareness and physical activity among the youth and Society. Another factor which leads to the increase in the competition in this industry is the increase in population. I observed that, every business has to go through a series of analysis of the market in order to know better about the market Trends and the needs and preferences of the consumers because ultimately the product has to be developed and delivered to the consumer. Therefore, it is important to understand the consumer and accordingly the product should be produced and delivered.
• I learnt the various concepts on the leadership, group dynamics and Organization culture. In any business, employees and workers the most important asset because the implementation of the various policies and decisions in the organization cannot be successful without the active cooperation and participation of the workforce. In order to engage the workforce, it is important to take care after professional development needs and training needs. There is also need to follow a situation in leadership Theory where the management can amend the leadership ways according to the different situation and the strategies should also be altered with the changing situations. Leadership theories help to me to develop various leadership skills in me(Ahmed et al., 2016).
• I realized the importance of teamwork and the initial phase where the team members can either spend time in brainstorming and face the challenge of getting compatible with each other in order to develop a sense of understanding and Bond to work together as a team or it can waste the initial time which will later lead to non-engagement and lack of interest to work as a team. I learnt about the importance of having an open communication among the team members in order to achieve maximum for any activity. One has to take the role of a leader and have to guide the team members towards the common goals of the team(Sanyal & Hisam, 2018).

Recommendations and conclusions

In order to encourage the future performance of the company some recommendations are there which can be used to improve the profitability, overall performance of the company and the engagement of the team members.

• The roles and responsibilities among the team members should be distributed in the starting and no delay should be done in this case. There should be extensive brainstorming activities and interactive activities among the team members in the beginning, so that each team member can understand other team member in a better manner(Stacho & Stachová, 2019).
• In the absence of coordination among the team members or in the case of conflict between the members of the team, the mentor or the leader should intervene to help the members of the team to work in proper harmony and coordination.
• The vision of the company should be clear and simple. The core values of the company should be explained properly and the targets have to be identified using the SMART goals.
• In order to frame the original Strategies and making various decisions, detailed environment scanning, and market analysis should be done and based on the result, strategies should be framed(Kozlowski & Ilgen, 2006).
• The market survey should be a continuous task, so that the Strategies and decisions can be amended as per the changing requirements of the environment.
• Quality check standards should be applied and separate budget should be kept for the quality check.
• They should not be general strategies for the product category. Each product category has a different target audience and positioning technique. Therefore, there is a need to use different strategies with regard to the quality standards, pricing of product for the different product categories.
• The leadership theories and group dynamics theories should be used in order to involve the team members and to get the maximum from their participation as a group(Adu-Oppong, 2014).

To conclude, business Strategies and decisions should be based on marketing research and extensive environment scanning. Opportunities and threats should be identified and it should be a continuous task. Each and every member of the team is very important in order to help the company or the business succeed. The involvement and engagement of the team members are required to implement the Strategies and decisions.

References

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