Country Manager
Allstar Brands In Asia
Team 5 (MKT 304-01):
Payal Handiwala
Christopher Suozzo
Venus Teah
Lindsey Meldrum
Sean Price
Table of Contents
Executive Summary
Purpose
Team Operations
Progress
Periods 0-2
Periods 3-5
Restart
Periods 0-2
Periods 3-5
Period 6
Comparison of Initial and Final Plan
Results
What We learned
Recommendations
Appendices
Appendix A
Appendix B
Appendix C
Executive Summary
The online simulation “Country Manager” provides for the interactive application of
marketing concepts appropriate to the launch of a product into a new country. Of the two
scenarios made available to subscribers of this simulation, the analysis comprising this report
addresses only expansion into Asia, and not Latin America. Team operations relevant to the
completion of this simulation involved the use of social media to arrange meetings (usually 1-2
per week), during which we functioned as one unit, collectively analyzing the outcomes of
decisions.
A. Case Background
The maturation of markets in Western Europe, North America, and Australia prompted
Allstar Brands to proactively expand its business operations into newly emergent economies in
Asia, where growth rates of the middle class and GDP per capita had reached impressive levels.
Allstar Brands sought to capitalize on the opportunities provided under such conditions by
enlisting the directive reasoning of its brand managers, whose responsibility it was to execute
strategic marketing decisions requisite for the successful expansion of Allstar Brands’ Allsmile
line of toothpaste. In Country Manager, all respective decisions were made within the scope of
such marketing concepts as market entry, segmentation, targeting, and the 4Ps.
B. Country Selection
Market entry was preceded by an evaluation of the relative attractiveness of countries
China, India, Japan, South Korea, the Philippines, and Thailand on the basis of several
indicators: Gross Domestic Product (GDP) per capita, GDP growth, overall supply costs, market
size, etc. An assessment of these criteria across all respective nations allowed us to reduce the
selection of potential markets to China, Japan, and South Korea, with full-plant production
commencing in Thailand after the completion of period one.
The selection of Thailand as the primary source of production was due, in part, to the
volume of goods it exports to target markets China (i.e. 10.6%) and Japan (i.e., 10.3%), which
provided greater ease of access to our target markets and eliminated a need to establish trade
relationships with our target markets, which could have put certain restrictions on our ability to
expand production capacity. Furthermore, the number of individuals active in the industrial
sector of the economy, which comprised over 45% of the nation’s GDP in 2010, was
considerably greater than that of other countries considered for production. Thailand’s economy
is export-driven and has expanded considerably since the 2008-2009 global financial crisis, and
it was expected to continue to experience growth well into 2011. This information served to
further reinforce our decision to select Thailand as our primary country of production.
C. Overview of Operations and Results
Allstar Brands made its debut in China during the first period while its plant in Thailand
was being built. Period two was marked by entrance into Japan and South Korea, after which a
chief concern became creating brand awareness, which resulted in the implementation of
marketing campaigns in both South Korea and Japan, while advertising expenditures were raised
in China. In essence, advertising was the greatest contributor to total marketing expenses during
period two. Prices were set within a range between the lowest and highest prices charged by the
competition in an effort to appear comparable to the competition as a whole, and products were
distributed in each target market according to the shopping habits of certain target demographics
and the frequency of consumption in each channel. The most popular channels among all target
markets were hypermarkets and drugstores, with the exception of South Korea, in which the
Independent market was also utilized.
In periods 3-5, older advertising campaigns were renewed and others were added. New
product extensions were introduced in Japan and South Korea after an analysis of the
competition revealed an opportunity to profit from the introduction of a whitening toothpaste.
The pricing strategy in Japan and South Korea was generally to price below the competition in
an effort to increase sales, while the approach in China centered primarily on pricing closer to
the competitor asking the highest price. Distribution remained largely unchanged from period
two; however, in South Korea sales people were taken from independent and hypermarket
channels and allocated to drugstores. There was a general tendency toward the end of this
timeframe to price below the competition in an effort to increase sales. Conversely, in periods 67, pricing higher in China was done in the hope of improving brand equity and unit sales.
The strategy overall in periods 6-7 was to either price above the competition to improve
brand equity, or to price match, as was the case in Japan and South Korea. As prices were
increased in China and South Korea, so were their respective advertising expenditures. The
strategy implemented in period seven was generally to price lower than the competition. We
added a new family economy campaign in South Korea during period six and decided to
decrease expenditures on our younger white tubed toothpaste. In addition, we observed that
hypermarkets began losing popularity in both South Korea and China, and we decided to
increased our sales force accordingly, before addressing the renewal of advertising campaigns
and the reduction of advertising expenditures in China, which were performed in an effort to
reduce total marketing expenditures.
D. Key Findings
The successful completion of this simulation proved by and large to be an exercise in trial
and error; often times the most counter-intuitive approach proved to be the most effective. In
initial consideration, the decision to underprice competitors seemed to provide logical basis for
increased unit sales; however, as observed in China, this often had a negative impact on both
sales and brand equity. In addition, increasing production too much in the simulation created
excess capacity that only contributed to the overall cost of goods sold as a lack of unit sales
failed to adequately offset the expense of plant depreciation. Furthermore, entering all three
target markets in the first period, as production units were still being manufactured entirely in the
U.S., proved to severely curtail revenue derived from unit sales, as we were incurring higher
logistical costs. As such, growth of operations in Asia was hampered early on in the simulation
to an extent from which, in later periods, recovery became quite difficult. In closing, the
determination of more viable approaches to the expansion of Allstar Brands’ into Asia required
two restarts of the simulation and 4 replays of select periods.
Purpose
CountryManager explores the modes of market entry, segmentation, and targeting, and
the 4Ps in an international context. Its purpose is to provide valuable experience for marketing
students in an international context. CountryManager offers two different scenarios available in
two regions: Latin America and Asia. Our class chose to focus on the Asian market including
these countries: China, India, Japan, South Korea, Philippines, and Thailand. We took the role
as Country Manager for the All Star company, specifically marketing our companies toothpaste
brand- All Smile. The simulation encounters competitors in the international, regional, and local
level and through research and strategy the team determines the best course of action to establish
a presence in said markets.
The first step in Country manager is to develop a country attractiveness spreadsheet to
help determine what countries and markets the team should be targeting, as seen in Appendix A.
Based on 8 factors we ranked by importance to us we had a score assigned to each country. The
spreadsheet was able to tell us that the best countries to enter were China, Japan, and South
Korea based off of positive factors and advantages each country posed.
Our group decided that the most important factor at 18% was the GDP per capita of each
country. The other factors in order of highest weight to lowest were GDP growth, overall costs,
low strength of the local and regional competitors, stability (inflation), transportation costs,
globally strategic, and tariffs. We believed GDP per capita to be the most important because is
measures the GDP divided by the population. We wanted to be in countries with stable
economies. Overall costs was next on the list which was calculated from several factors such as
sales force, fixed costs, unit costs, and administrative costs. We believed entering a country with
low costs was very important especially for where the plant was to be built. GDP growth was
almost as important as the GDP itself for our group. Low strength of local and regional meant
that the countries we were entering had a large amount of international brands and it was
somewhere that we could compete more easily- a lower barrier to entry. Transportation costs
were important factors because of keeping the gross margins low so we had to be in countries
that worked best with shipping to from both home and our plant. Globally strategic was based
off of several factors we believed made the country more appealing to enter. Lastly, tariffs were
significant to our group based off again that we wanted low costs to help gross margin.
Based on the spreadsheet we decided to build our plant in Thailand and enter China,
Japan, and South Korea. From this point we began the simulation and worked as a team period
to period with several replays and restarts in between to learn more about international marketing
through the trials and errors we encountered along the way.
Team Operations
Throughout the process of Country Manager, our team of five members decided to work
together until the completion of the simulation. We felt that every person had a valuable input to
give for all areas of the company we built together and that advancing as a whole in every period
made us more confident about our decisions. Our group had pretty respectable communication
with each other since we were able to figure out proper times to meet up without any hassles and
every member was eager to help our simulation perform to the best of our ability. For every
decision we made and for every result we received, each member in our group would analyze it
in order to see what mistakes we made, what we can improve on and what factors we should
continue to keep doing. Through out the CountryManager Simulation, we did not have the best
of rankings and though how we stand amongst other teams did not matter, we strove to do better
to give us that competitive edge that would instigate us to receive better profits and brand equity.
We were determined to acquire better results so our team ended up restarting twice. Though the
first restart did not fare well with us because it seemed that we did worse than the first time, we
collectively agreed that a second restart was necessary. Though it took much of our time,
sometimes more than we expected, every team member was willing to contribute to our
simulation.
Our group met once a week, and sometimes twice a week, usually on a Tuesday night or
a Wednesday night. The later hours at the library seemed to work the best for each member
because we were all done with classes and it did not conflict with any other obligations such as
club meetings, work, or Greek life activities. All of our meetings took place at the library, where
we would conveniently find study rooms for us to use and allow us to think properly without any
disturbances. We immediately knew that working together would be the best idea because
talking in person would be the most effective method in terms of relaying opinions, suggestions,
and other ideas. However, we did create a Facebook group where we discussed meeting times,
notes that were taken, and sometimes opinions that we would of course later discuss. One of the
key things we were grateful for was that Venus took care of writing out our decisions and why
we took certain measures so we would remember for next time on our next meetings. Keeping
track of what we did and why helped us further progress and keep in track of the goals we
wanted to meet.
During our meetings, one of the first things we would do is look at the comparative
results from our previous decision and see where we stand. Then we would analyze our
performance summary, brand equity, net contribution, country contribution, SKU contribution,
and sales report. As a team we would discuss the factors that we did good on and what we can
improve on. From there, we would fix our mistakes on the next decision. In the beginning of
CountryManager, we found it a little difficult to make decisions especially in terms of pricings,
distribution channels, and number of sales people because it was our first time working on a
realistic scenario. However, as we continued to get more experience, the team, as a whole was
able to make better choices and it became easier.
Progress
Start of Simulation
INTIAL OBJECTIVES
Before beginning the simulation, the team created both a Country Attractiveness Plan and
an initial marketing plan to determine which countries we would enter. After collecting and
comparing stats on each region, we decided China, Japan, and South Korea would be our
countries of choice. These regions scored high in our Country Attractiveness Plan based on
various different points of criteria such as GDP per capita, market size, inflation rate, and labor
costs. Thailand was chosen as the location of our manufacturing plant because of the
combination of its low labor costs, low shipping costs (per unit), and the moderate tariff
percentage in the country (See Figure 1). We set our initial capacity to 300.
Our team set conservative goals for our first run of the simulation. We determined that
our focus would be to maximize our brand awareness and customer satisfaction in each country.
We made a short term goal of achieving 10% market share in each region by the end of the third
period, with a long term goal of achieving the highest brand equity in each country compared to
our competitors.
The first period we decided to enter into only one region; starting with our biggest
market, which was China. Introducing our brand into one country first, instead of all three, made
the decision making process simpler and less overwhelming. We planned to extrapolate our
experience gained in China and transfer it into the decision planning for South Korea and Japan,
which we would enter into during the next period.
PERIOD 0 -2
In the beginning periods, the team concentrated on significantly boosting advertising and
promotion expenses in each country in order to keep a competitively close range to the other
companies. In China we originally set our promotion expense to $1.3 million but boosted it to
$30 million within one period. Similarly advertising was increased from $12.2 million to
$35million. In Japan advertising was kept at $42 million, while promotion was set to $10
million, which, although lower than our promotion in China, was higher than our Japanese
competitors. Out team projected that heavily investing in advertising and promotion would
benefit us significantly as a new brand in these countries, enabling us to attain our goal of high
brand awareness and brand equity. Comparatively, our sales force expense was also kept within
the same range as promotion and advertisement.
Our SKU count for each country was kept low. We concentrated on one segmentation for
each country: “Economy” in China, and “Healthy” in both South Korea and Japan. We created
two sizes for each country; small and medium sizes were placed in both Japan and South Korea,
while in China we decided to try small and large sizes. We used our competitors as a bench mark
to predict which brand formulations and sized would provide the best results in each country.
PERIOD 3-5
We achieved good results with our earlier made decisions. Our brand equity was
relatively high in each country, and both China and Japan had impressive gross margins.
However, across each region our brand awareness had not improved dramatically and our unit
sales were not as high as we would have preferred. In order to improve these two elements, the
team decided to enter into more distribution channels, as well as increase the number of SKUS
across each country. We expanded into the hypermarket in China, the drugstore and wholesale in
Japan, and the hypermarket in South Korea. In addition we took advantage of the introduction of
the new pumps into the market and added these into our new SKU formulations.
Overall we benefitted significantly from these changes. Both our market share and units
sold increased considerably. We also met our short term goal of reaching 10% market share in
each region within the first three periods. After finishing five periods we felt that we had a good
grasp on the simulation and could safely start over while implementing our newfound knowledge
to increase our performance in our future run through.
RESTART
In planning for the restart of the simulation, our team decided to make a significant
adjustment to our original entrance strategy. Because of our moderate success in our initial play,
and the experience we now had making various marketing decisions within the different regions,
we felt that we could confidently enter into all three regions within one period. We also started
off with a more diversified selection of SKUs in each region. We thought that expanding into
different product selections from the beginning would ultimately result in high unit sales.
PERIOD 0 – 2
Because of our various selections of SKUs, several campaigns were needed for each
region. We used consumer-shopping habits to evaluate how each campaign should be structured
and which channel of distribution should be used. We compared which distribution channel
consumers shopped the most within each country, and the demographic breakdown (Family,
Younger, or Older) of that distribution channel. We targeted our “White” campaigns toward
younger consumers in each region, but we focused on families in China, the older generation in
Japan, and both the older consumers and families in South Korea for the rest of our SKUs. For
pricing, instead of positioning ourselves between our competitors (which was done in the first
trial of the simulation), we concentrated on keeping prices lower than the competition in each
country.
Our results for these first few periods were shocking. Instead of the positive outcome we
were expecting, our performance was very poor. As the result of entering into all three countries
at once our overall Cost of Goods Sold (COGS) were extremely high as these items were initially
being transported from the Home plant, before we opened our plant in Thailand. To add to this
drawback, we did not set an accurate prediction as to what capacity our plant should be placed.
We did not take into account the amount of potential sales that would be made in three combined
regions instead of just one. Also, because we decided to price our items so low in China, our unit
sales were higher than forecasted. Therefore even after having our plant built in Thailand, we
had a large bulk once again coming from our Home plant. By the end of our second period, as
we were entering into the third, our Net Regional Contribution was at a low of -$170.9 million.
PERIOD 3 – 5
Although we originally believed that adding a large array of SKUs would ultimately
heighten sales, this did not work to our best interest. Pricing low resulted in a small inflow of
revenue from our sales. The revenue gained from individual products was only slightly higher
than the COGS for those products. This resulted in extremely low gross margins.
Our team then made the decision to boost up the price of products, while also cutting out
the products that did not sell well and replacing them with others. Such large changes resulted in
a considerable drop in our brand equity in each country, and a large drop of unit sales in China.
We learned through this that we had to take more care in SKU selection and pricing for each
region. Our team began giving more significance to the preferences of shoppers. We closely
scrutinized Decision Criteria and Product Preferences of the country’s consumers. We learned
that each country had a different preference for size, texture, and delivery. For example, South
Korea largely preferred the tube over using pumps, which explained why our pump products
were not doing well in that region. (See Figure 2)
At this point, our team became more cognizant of the different variables that went into making
these decisions. We made it a goal to fully examine and comprehend all of the data provided to
us by the simulation in order to make future decisions.
PERIOD 6
Before moving on to Period 6, our team thoroughly analyzed the unit sales of individual
SKUs to find which product had a drop in sales from one period to the next. We then went back
and observed what adjustments were made the previous period that could have potentially caused
the decline. Looking at the Brand Equity Index in the simulation’s Performance Summary
allowed us to view how well our selections of products were received in each region. This Index
was broken down into “Benefit Positioning”, “Creative Execution”, “Price Positioning”, “Sales
Leader”, and “Share of Mind” for each country. Through viewing which Index had a low score,
this helped us to pinpoint the current problems with our products.
From Period 5 to Period 6 we implemented our new strategy and saw instant improvement in our
Brand Equity, Unit Sales, and Net Contribution. We then decided it would do us well to do
another restart. We created a detailed list of everything that worked during this run of the
simulation and all the decisions that had a negative impact on either our sales or our brand
equity.
FUTURE DECISIONS
Our second run through made our team painfully aware of the intricacies of this
simulation. While we originally used our competitors each period as a standard of how we
should price our products and adjust for both advertising and promotion, this method proved
inefficient in the long run.
We learned that each decision was to be made based on an in depth
analysis of various pieces of data compared between both the present and past periods. We gain
insight into how each individual decision affected our unit sales per SKU, and from there we
learned to adjust accordingly.
With our second restart, we would use our Decision Summary to see how our
modifications would affect SKU Contribution, Brand Equity Index (particularly the Price
Positioning and Creative Execution), Country Net Contribution, and Return on Marketing for
individual countries. More focused would be placed on the Consumer Decision Criteria in order
to come up with campaigns and product selections.
We also would keep track of the Retail Sales per distribution channel in each country.
This would allow us to know when to potentially leave or enter into a channel based on a
significant increase or drop in retail sales and also how to adjust the amount of sales people in
each channel. Our biggest misstep in this run of the simulation was becoming too liberal in our
choice of SKUs, and not coming up with individual pricing strategies for each region. Our goal
was to improve on this in the second restart.
Figure 1
Figure 2
Comparison of Initial and Final Marketing Plan
Initial Plan
Revised Plan
Rationale for Changes
Region
Countries &
timing
Production
location
China Period 1
Japan Period 2
South Korea
Period 3
China Period 1
Thailand
Thailand
Younger
Younger, Families, and
Older
Japan and South Korea
Period 2
We felt that we did not have to take
entering countries as slow as we
originally thought
Country 1:
China
Target
markets
We learned that there is no need to try
and target just one market and we
could be making money by going after
more
Positioning
& mix
strategies
White and
independent priced
slightly lower than
competition
Economy, white and
healthy through
independent and
hypermarket. Priced
higher than the
competition.
Research into shopping habits showed
which channels were the most popular
and we checked to make sure they
were also lucrative as well. We also
wanted to sell more SKU’s than
originally planned so we tried more
than just one positioning
Target
markets
Older
Younger and older
Drug stores were more popular than we
expected in Japan and they worked
very well for us
Positioning
& mix
strategies
Healthy and
Hypermarket
priced slightly
lower than
competition
Healthy and white in
drug store and
hypermarket. Price
matched to lowest
competitor.
White we think worked well in Japan
because they were a country that cared
more about the effect than the price
Target
markets
Older
Younger older and
families
Same reasoning as in China
Positioning
& mix
strategies
Healthy and
Hypermarket
priced slightly
lower than
competition
Economy, White, and
Healthy in Independent,
hypermarket, and
drugstore. Price
matched to lowest
competitor
Same reasons as in China- to make as
much money as possible and not limit
ourselves to just one type
Country 2:
Japan
Country 3:
South
Korea
Production began immediately; in all plays of the game we built a plant in Thailand in
period 1 to have product no longer coming from home in period 2. We did not encounter too
many issues with the sizing and capacity, we began with 375 and eventually ended up at 750
million units of capacity. We did however learn that it is possible to take away capacity but it
was in our last 2 periods of our last restart so it was a little late to actually be useful to us.
The biggest difference between our initial marketing plan and our final marketing plan
was our target markets. Below shows some of the initial and revised marketing plans with the
full plans in Appendix B and C. We thought there would only be one target per country but we
learned from playing that there were always at least 2 per country and sometimes 3. Also the
distribution channels, we again thought only 1 per country was necessary and that was also very
incorrect as we ended up having at least 2 in every country. Lastly, the competitors were almost
always the international brands so that’s was a minor correction made during the play of the
game.
Results
The results of our CountryManager simulation varied in terms of countries and other
aspects. With a total of two restarts and four replays, our team definitely learned a lot with every
period we advanced to and continued to make adjustments. We did make quite a few mistakes,
such as by accidently only inputting three in Number of Sales people in China in our first period.
Though it did take a toll on our results, we quickly learned to fix this error and were able to get
right back on track on Decision Two. During our first run through, our group decided to not
enter all the markets at the same time and later on we realized it was not the best idea. We
decided to build a plant in Thailand because our team felt that it was the best place in terms of
location, resources and costs. We entered China the First Period, Japan the Second Period and
lastly South Korea the Third Period. Our brand equity was also negatively affected because we
kept our pricings of the toothpaste below the lowest competitive cost and we also did not spend
enough on advertising and promotion, as we should have since we were a brand new company
entering the south Asian market.
Around decision six, our team decided to restart the whole entire simulation and start
from scratch. We felt that re-doing all the periods might help us receive better gross margins, and
brand equity. However, we had the complete opposite effects. It seemed that our brand equity
decreased, we were not selling enough toothpaste whether it was paste or gel in Japan and our
gross margins were not up to par. After receiving some feedback from our classmates we
ultimately decided to start over once again because we were determined to boost our BEI (Brand
Equity Index) and our gross margins.
During our last restart, we made some drastic changes. We entered all the markets, China,
Japan, and South Korea at the same time. We decided to increase our advertisement and
promotion in each country, especially in Japan. We realized that as a new company, we needed
to spend a good portion of our money on that. Throughout our decisions, we continually
increased our budget and it seemed to enlarge our sales. For example, during Period One, South
Korea only had two campaigns, which were both budgeted at 1,750 KRW. However, at the end
in Period 8, our team had four campaigns, two budgeted at 2,400 KRW, and the other two at
2,100 KRW.
Another method we also decided to implement was to keep prices in the middle of the
competition because keeping it too low would lower our brand equity and if its too high then no
one will want to buy our products. This seemed to fare well with us because our gross margins
significantly increased to 54.6%. Our brand equity also increased to 72.
Towards the end, our team learned a lot about entering new markets, distribution
channels, advertising and pricing. After being put in such a realistic scenario with this toothpaste,
we realized that there are so many determining factors that affect our gross margins and profits
greatly. Despite the mistakes we have made, our group arduously worked to get the best possible
results.
What We Learned
The country manager simulation gave us a realistic perspective of being part of a
management team for a global brand. In approaching and carrying out the decision making
process for the All Smile brand we had the opportunity to apply the knowledge we gained from
our textbook, classes and lectures in a realistic scenario. What was learned from this experience
can be divided into two broad lessons, balance and diligence and awareness. These lessons and
the manner in which we learned them will be discussed.
Balance
In developing a market strategy we learned it is important to find a balance between
factors. Ultimately this is the balance between costs and income, but specifically this is the
balance between market entry, product line, advertising and promotion, production location and
capacity, pricing and the number of sales made. By finding the right mix of these factors, a
balance, as we did in our second replay, we were able to reach high economies of scale. However
our in our initial strategy and our second strategy we were too cautious and then too extravagant.
Having stepped carefully in our first round and seeing our sales and brand equity suffer because
of this, we were eager in the second round to increase our advertising and promotion, to add
more SKU’s and enter all of countries in the first period. Noting that our caution was a problem
we went to the other extreme seeking to solve it but in doing this caused ourselves new
problems. Our brand equity improved at first but eventually we had to raise the prices of our
products and withdraw some of the SKUs from the product line in order to cover costs. This
caused our brand equity to drop and a reduction in production units and sales, making us unable
to make up for the amount initially spent on advertising.
In our final replay we staggered the entry to our chosen markets and used our past
experiences to develop advertising and promotional budgets on which we could capitalise. We
took as specified approach towards SKU’s and distribution, choosing products and channels
which matched with the buying preferences and shopping behaviour in each country. This
approach was our most successful as it allowed us to maintain a balance between sales, margins,
production capacity and net income.
We learnt that there is not one right way when it comes to strategy, but that a combination of
techniques and getting the right balance in the mix of factors for each specific country aids
managers in being successful.
Diligence and Awareness
Initially we did not realize how important it was to have an awareness of the external
influences, which affected our brand, and how important it was to monitor the changes in these
influences and adjust our strategies accordingly. We did not diligently assess each of our
decisions in each period in relation to these external factors and also our internal factors. We
learned that we had to constantly reassess the behavioral patterns of our competitors, particularly
in relation to pricing, products and distribution and our consumers, particularly in relation to
their shopping habits and product preferences. We also discovered we had to operate on a more
in depth level, for example, comparing the price of a specific SKU of each of our competitors
rather than taking an average of the prices to use as a guide.
In our first two rounds having developed a strategy and having made the decisions in
relation to how we would price, what products we would use and what campaigns we would use
we then implement it and see if we sunk or swam. By our third run we had learned that the
market fluctuates frequently and drastically. To keep in line with our competitors we needed a
looser overall strategy and more focus on the current details to aid us in making decisions.
We learned also that it is important to double-check everything and that a pool of
opinions is better than one. When operating on a level we’re intricate detail is important
individuals can sometimes become so focused on one decision or country and forget about
another. By working together as a group to make our decisions it was less likely that something
would go unchecked. However there were times where we would progress to the next round to
find that we had not given enough attention to a particular decision or factor.
The more that we used the simulation the more we understood that we must always be
thorough by firstly assessing all of the available information, both internal and external, at the
start of every period and by checking each of our decisions thoroughly before progressing.
Recommendations
In the What We Learned section the importance of achieving balance and diligence and
awareness were discussed. Three main recommendations emerged in this section that would help
to aid the achievement of these concepts. These were aiming for economies of scale, having a
flexible overall strategy and performing a specific analysis and having a specific strategy for
each market. Each of these recommendations will be discussed.
Aim for high economies of scale
By aiming for high economies of scale All Smile will be able to achieve the balance
which we learned was so important. However balance and high economies of scale have a
causality dilemma like relationship; achieving high economies of scale is dependent on a balance
of factors and by finding the point at which the brand will achieve the highest economies of scale
these factors will be in balance. Much analysis, research and experimentation is needed to
discover what balance of factors is needed to achieve the highest economies of scale. It is also
important to note that as the markets fluctuate the point at which the brand achieves the highest
economies of scale will fluctuate.
Flexible overall strategy
We discovered that our initial strategy, which was too detailed, caused us to miss
important details during the progress of the simulation and hindered our reactions to any
fluctuations in the market. It was too static for such ever changing markets. It was much better to
do the detailed analysis in each period in order to make sure we were making the right
adjustments for the current market. This leads to our last recommendation, to specifically
approach each market with a separate analysis and strategy before applying the overall strategy.
Specific analysis and strategy for each market
We recommend that the All Smile brand managers should be thorough when building
information from the data available and assess each country separately, making sure the needs
and wants of each market are met by a specific strategy. Asia as a region has vastly distinguished
communities, and cultural norms and economic situations vary considerably from country to
country. While it may not always be viable to meet the needs of each of the individual markets it
is still important to have all of the specific information in order to prioritize in the overall
decision process.