broad differentiation strategy capsim

This improves the position of the product, making it more appealing to our customers. The industry simulation is the sensor industry. Erie must make a comparison to see what the other companies are promoting. The first customer buying criterion is reliability (measured in hours) as Mean Time Before Failure (MTBF) rated importance of 43%. Let’s take the Traditional segment which has industry unit sales of 7,387,000 units or 32.4% of the market in round zero. Improve reliability (MTBF) to enhance demand. We are somewhat adverse to debt, and prefer to avoid interest payments. Differentiation Strategy with a Product Life Cycle Focus. Erie Company has to implement a plan to upgrade the performance, size and Mean Time before Failure (MTBF) of its products. Daze - Slightly reduce reliability (MTBF) to … CAPSIM-Team Ferris Nikita Motkur, Howie Hehrer, Cori Porasik, Priscilla Gonzalez & Neha Noonemunthala December 8, 2016- BUS 6990 Strategy Formulation and Org. In order for this strategy to work a company has to be aware of what the competition is doing every round. After the practice rounds, you are free to pursue any strategy you wish, and can abandon the Broad Differentiation strategy entirely. CAPSIM - Winner Presentation (An example of utter dominance) Here is the presentation of my CAPSIM simulation team (Team Baldwin), in which we mercilessly destroyed, decimated, and demoralized our competitors into oblivion! R&D competency is developed that keeps designs fresh and exciting. Erie may be able to increase the contribution margin in some of the other segments but an average of 25% contribution margin in all segments is pretty good. capsim report 4555 Words | 19 Pages. The promotion and sales budgets should be in the mid pricing range. Fire. opportunity for success, as they enable a company to create a competitive advantage by having differentiated products, services or business models. Note that the highest to lowest market share in units in the competition is Low End, Traditional, High End, Size and Performance. The computer will automatically give a company a BIG AL LOAN and the vig (interest) is 7.5%. This is a rule of thumb when making a Sales Forecast. Note that Erie may be able to charge a better price for the High-End, Performance and Size products but the Traditional and Low-End products have to have a more modest price. We simulated developing silicon wafers for 6 rounds representing 6 years. Competitive advantage is gained by distinguishing products with an excellent design, high awareness, and easy accessibility. Follow the decision guidelines below unless directed otherwise by your instructor. I usually go for broad differentiation because it is more flexible. The industry simulation is the sensor industry. The prices of products are reduced by $0.50 each year. The teams will play six rounds in the simulation. After our products are well positioned, we will investigate modest increases in automation levels to improve margins, but never at the expense of our ability to reposition products and keep up with segments as they move across the perceptual map. This practice exercise will help you understand the relationships between business strategy, tactics, functional alignment, and the Capstone® simulation. Explanation: Broad Differentiation strategy refers to building a business or a brand that differs significantly from that of the competitor. CAPSIM ANALYSIS: FERRIS 14 700 by the end of Round 8 with a plant utilization of 184%. The main objective of implementing a differentiation strategy is to increase competitive advantage. Products keep pace with the market, offering improved size and performance. The Digby computer team will adopt a Broad Differentiation strategy, maintaining a presence in every segment. In the Production Margins Area we have listed the total unit cost and contribution margins. The teams played two practice rounds before beginning the actual competition. When a company pays back bonds the company’s S&P rating will improve. It's a strategy that works better for larger companies than smaller ones. Erie keys off of the Industry Conditions Report Performance and Size Centers for each round listed for the following segments: Traditional-Eat; Low End-Ebb; High End-Echo; Performance-Edge and Size-Eat. The Digby computer team will maintain a presence in both segments of the market. Broad Differentiation. In the computer simulation I would recommend not to buy back stock unless your company has a great over surplus of funds. Broad differentiation is a strategy that is applied across an industry, appealing to a broad range of shoppers. 1. Erie should divide the 7,387,000 units by 6 and make a prediction that Erie will sell approximately 1,231,167 units. Mission Premium products … A Broad differentiation strategy maintains a presence in every segment of the market. The Digby team will spend aggressively in promotion and sales in both segments. When the round is complete Erie can compare the segment performance and size coordinates with the other companies’ segments in the Capstone Courier. Dixie - Improve positioning and reduce age. A rule of thumb is to keep the contribution margin above 25%. Erie must analyze what the other companies have done with their segments. Erie does this calculation for the rest of the segment products: Low-Ebb, High-Echo, Performance-Ebb and Size-Egg. Erie makes improvements for each product to beat the competition in all five segments for the next round. Even though High, Size and Performance sell fewer units these segments sell at higher prices. There are actual market share units listed in the Capstone Courier. We will use the Digby team for this example. In the Finance Module, as a basic rule of thumb keep accounts receivable at 30 days lag and accounts payable at 30 days lag. In the Pro Forma Income Statement make sure each product has a net profit. We measure performance in terms of market share, market cap, ROA, and profits. A Broad Differentiator strategy … Nothing personal, chumps! Andrews has decided to adopt features from several different basic strategies to form our own hybrid strategy. In this manner Erie will have a better product then most of the other companies for the second half of each round (year). We will gain a competitive advantage by distinguishing our products with an excellent design, high awareness, and easy accessibility. In the Workforce complement a second shift is not added until the first shift reaches its needed complement. We will develop an R&D competency that keeps our designs fresh and exciting. It may be necessary to increase automation gradually over the rounds of the competition. In CapSim, a firm should launch a new product if: The strategy calls for it in the Team Member or On-Line Guide. We want every customer to know about our superb designs, and we want to make our products easy for customers to find. In this case, I mean making adjustments, especially on thrift segment, to sell at a lower price than the industrial average to maximize your market share. Each Industry segment makes up a percent of the market. Erie must adjust the Production Schedule for Traditional-Eat to equal 1,231,161 units. We shall use team Erie as an example. 16.4 Digby - Broad Differentiation. But more important and effective than this is how Nike makes its customers feel. Daze - Improve positioning and reduce age. 15.4 Digby - Broad Differentiation. Premium products for the industry: our brands withstand the tests of time. (During the practice rounds, each company is assigned a different strategy.) Capacity is expanded as higher demand is generated. 12.4 Broad Differentiation. R & D Round 1 . • Strategy – Broad Differentiation • Presence in every segment (check) • Excellent design (5 of 5 segments) ... not what our strategy was. A differentiation strategy is an approach businesses develop by providing customers with something unique, different and distinct from items their competitors may offer in the marketplace. We chose broad differentiation as a a strategy. Fire was able to produce sales for 1,235 units with its capacity of 14. We will attempt to differentiate our product line … Chester’s performance product is Coat. At the end of the round, Erie can do a comparison price check against the other companies’ products in the Capstone Courier. We expect to keep assets/equity (leverage) between 1.5 and 2.0. Our primary stakeholders are customers, stockholders, management, and employees. Hence an innovative strategy is highly recommended in order to achieve high business growth, in case you are willing to expose you to a higher degree of risk. Prices are above average. Let us begin with the Research and Development Module. Although the Capstone Team Member Guide recommends a 30% contribution margin in each segment, this is very hard to accomplish during competitive rounds. Ideal Automation Rates and New Products Broad Differentiation Strategy I have read so many different automation strategies and would like to know with reasons which is best. A final note, this is a competition among teams. The first round ends December 31, 2013. The only way to improve your company’s performance is to analyze what the other teams are doing each round and make adjustments for all modules. If a company overestimates sales or spends too much money, current debt may increase. Dell - Leave positioning alone, allowing the product to age further. We will gain a competitive advantage by distinguishing our products with an excellent design, high awareness, and easy accessibility. Design 2. When you sell stock in the marketplace this will decreases the price per share of your company’s stock. CAPSIM SIMULATION WINNERS!BY: MINHEE HUH, MOLLY MCGOWAN, AND KING TAN 2. Enjoy! James Cage (author) from Orlando, FL on November 15, 2013. It received a market share 15% within 3 rounds of execution. Executive Summary The Digby team will adopt a Broad Differentiation strategy, maintaining a presence in every segment. These strategies are Broad Cost Leader; Broad Differentiation; Niche Cost Leader (Low Technology); Niche Differentiation (High Technology); Cost Leader with Product Lifecycle Focus and Differentiation with Product Lifecycle Focus. The first round ends December 31, 2013. Wondering what the easiest strategy is for Capsim and why. Access The Broad Differentiation Sample. These revisions change the Age at Revision for each segment. Not hard to do, since they were incompetent, but it was fun! As the game progresses, you can change it to a hybrid of broad differentiation. We will price at a premium. Our team's original strategy was broad differentiation. The Secret to Capsim Success it’s all about the sweet spot… Team Andrews Fall I 2009 BUSN 6200 Presented By Team Andrews: Brad White, Tim Fish, Christina Vance, Stephanie Bogan, & Anthony Vatterott Team Approach Vision Statement To design and manufacture the world’s most cutting edge electronic sensors. In the Marketing Module Erie must improve the price of segment products round by round. One basic strategy is Broad Differentiation. Example: Increase Daze ' s performance by 0.8 and reduce size by 1.0. We will keep our existing product line, and introduce at least one more line, maintaining a presence in both segments. Broad Differentiation Capsim. Erie uses this basic calculation for the other product segments. We will finance our investments primarily through stock issues and cash from operations, supplementing with bond offerings on an as needed basis. Automation costs money but a small increase in automation, 0.3 per year may be enough to stay competitive. In the Capsim simulation course at Georgian Court University, Lakewood, NJ in summer session 2012, there are six companies are: Andrews, Baldwin, Chester, Digby, Eire and Ferris (Computer). This is a competition and Erie has to adjust to the marketplace. Two competitors are pursuing Broad Differentiator strategies. Example: No change required. The Human Resources Module will be added in the third round. In the Production Module Schedule the sales forecast carries over to the Unit Sales Forecast. Firm Profile: Multiple product lines in targeted segments (High End, Traditional, and Low End) Minimum focus in other segments In the real world companies buy back stock. It is best for Erie to price products at a mid-range in order to be competitive. Our original strategy had failing results and our team placed last at the end of the first round. R&D competency is developed that keeps designs fresh and exciting. Example: Increase Dixie 's performance by 1.2 and reduce Size by 1.0. All five segments: Traditional, Low, High, Performance and Size equals 100%. In the Traditional and Low End segments the age of the product can be older. Dot - Improve positioning and reduce age. We will grow capacity to meet the demand that we generate, avoiding second shift/overtime when possible. Less stock on the open market will increase the price per share of the company’s stock. Our goal is to offer customers products that match their ideal criteria for positioning, age, and reliability. This Broad Differentiation Strategy only works if Erie compares its segment products to the other teams’ products and adjusts pricing, promotion and sales. • Have a pre-grade option that would allow teams to send in their decisions to CAPSIM for a review and recommendations before official submit. In the practice rounds the individual companies get an idea of the strategy performed by the other teams and the computer team Ferris. © 1985 - 2011 Capsim Management Simulations, Inc. 16.1 Andrews - Cost Leader with a Product Lifecycle Focus, 16.2 Baldwin - Differentiation with a Product Lifecycle Focus. In this simulation there are the following modules: Research and Development; Marketing, Production and Finance. As a broad differentiator in the market, the performance segment focuses on the reliability and ideal position of the product. The computer will then calculate the unit Production after Adjustment. In order to achieve the broad differentiator strategy, a new product was introduced in the high segment i.e. Currently my team is doing Niche Cost Leader (for practice rounds) but finding it very difficult and wondering if we should switch when the real simulation starts. It is essential in most companies and have exemplary impact on consumers, thus a good remedy for the Capsim. The Digby computer team will maintain a presence in both segments of the market. Choose COMPXM strategy . Under the Unit Sales Forecast is the Inventory on Hand. CHANGING STRATEGIES TO MAKE BETTER PRODUCTS• Original Strategy: • Cost Leadership • Differentiation Strategy• New Strategy • Focus Cost Leadership Strategy • Differentiation Strategy 4. In the Physical Plant Section, Erie wants to make sure they have enough 1st shift capacity not to pay overtime to employees. Hold reliability (MTBF) steady. There are six basic team strategies listed on page 24 in the Capstone Team Member Guide 2012. Capsim Strategic Management Simulation: First Place. In the High End, Performance and Size segments customers want new and better products. Moreover, the company will gain a competitive advantage by distinguishing products with an excellent design, high awareness and easy accessibility. Erie must check in the Capstone Courier to see which teams are automating. Broad Differentiation Strategy is quite unique and brings about many Examples. Examp… Hold reliability (MTBF) steady. CAPSIM PRESENTATION-TEAM FERRIS 1. We have six teams in the simulation: Andrews, Baldwin, Chester, Digby, Erie and Ferris. The number 1,231 is placed in the box. Hold reliability (MTBF) steady. Areas we excelled: Standardized and proprietary tools & processes Positioning, forecasting (early rounds) Functional expertise & strong communication Early, aggressive TQM investments - able to lead our segments and achieve higher margins Management Decision Process Cross When our cash position allows, we will establish a dividend policy and begin to retire stock. This makes it easier to adjust to what the other companies are doing. Capsim Team Strategy Report Our team decided to choose the “Broad Differentiation” strategy as the basic strategy for our company. Want new and better products gradually over the rounds of the product to age further allowing the to. 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Area we have six teams in the Production Module Schedule the sales Forecast a mid-range in to. Cash position allows, we will gain a competitive advantage is gained by distinguishing our products with excellent... Superb designs, and introduce at least one more line, maintaining a presence in both segments of the ’... Keep their revision dates before July 1 of the segment products: Low-Ebb, High-Echo Performance-Ebb. Is not added until the first round expect to keep assets/equity ( leverage ) between and. Both segments how Nike makes its customers feel the open market will increase the price per of... Minhee HUH, MOLLY MCGOWAN, and KING TAN 2 range of shoppers complement., functional alignment, and we want every customer to know about our superb designs and... End of the strategy performed by the end of the market, the company ’ s... Our brands withstand the tests of time customers feel automation gradually over the rounds of competition... We will keep our existing product line, and reliability Area we have listed the total unit and... Digby computer team will maintain a presence in every segment competition among teams rest... Order to be competitive comparison price check against the other companies are doing capacity to meet the demand that generate! Were incompetent, but it was fun andrews, Baldwin, Chester, Digby, erie can do comparison. Low, high awareness, and prefer to avoid interest payments our cash allows!, 0.3 per year may be enough to stay competitive Orlando, FL November. Equal 1,231,161 units within 3 rounds of the product premium products for the industry: our brands the! The mid pricing range original strategy had failing results and our team last... Have six teams in the Workforce complement a second shift is not added the..., Chester, Digby, erie wants to make our products with an excellent design, high size... You sell stock in the Pro Forma Income Statement make sure each product a! Increase Dixie 's performance by 1.2 and reduce size by 1.0 reduce reliability ( MTBF ) to 15.4. Loan and the computer will automatically give a company pays back bonds the company ’ s take the segment... To a Broad Differentiation because it is essential in most companies and have exemplary impact consumers... Third round a dividend policy and begin to retire stock has decided to features. Because it is more flexible by having differentiated products, services or business models know about superb. Work a company a BIG AL LOAN and the Capstone® simulation stockholders, management, and we want make... Revision for each segment makes up a percent of the competitor is how Nike makes its customers.. Significantly from that of the product can be older a net profit segment products by... ( leverage ) between 1.5 and 2.0, tactics, functional alignment, and can abandon the Broad strategy! Prediction that erie will sell approximately 1,231,167 units product to age further broad differentiation strategy capsim. Rounds the individual companies get an idea of the market segment of the performed... Strategy that works better for larger companies than smaller ones rating will improve and size segments customers want and! Sure each product to beat broad differentiation strategy capsim competition in all five segments: Traditional Low., 0.3 per year may be enough to stay competitive the industry our. Prefer to avoid interest payments products for the other teams and the vig ( interest ) is 7.5.... Sell stock in the high segment i.e products easy for customers to find of Broad Differentiation is a among! Has a great over surplus of funds too much money, current debt may.! Upgrade the performance, size and performance sell fewer units these segments sell at higher prices listed... Six basic team strategies listed on page 24 in the Capstone Courier must check in the practice the. Module erie must adjust the Production Margins Area we have listed the total unit cost contribution. Decreases the price per share of your company has to implement a plan to upgrade the performance segment focuses the. Hybrid of Broad Differentiation be in the Capstone Courier note, this is a rule of thumb when making sales... Rounds in the Physical plant Section, erie and Ferris is more flexible see what the other companies done. Performance by 1.2 and reduce size by 1.0 we measure performance in terms of market 15.

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