An Introduction to
Mikes Bikes Advanced
Presented by:
Peter Janciw
What is a Business Simulation?
• A representation of a real world company
• Governed by real life business conditions
trying to achieve goals and strategies
• You are placed the role of Management
and must make strategic decisions
• It is NOT just a game, it is a learning
experience
Why simulations are used
• Application of theoretical business
concepts (everything you learned in IB1!)
• Used in both the academic and business
realm
• Simulations build teamwork skills and
provide an enjoyable way to learn.
• Manitoba International Marketing
Competition
We will now look at…
1.
2.
3.
4.
What is Mikes Bikes?
Simulation interface elements
The importance of strategy
The main functional areas of the
business
5. Things to watch for
What is Mikes Bikes?
• You are the new manager of a
manufacturer in the bicycle industry
• 5 market segments and 3 distribution
methods exist
• 2 versions: Single-Player and Multi-Player
We will be using the Multi-Player version
• Rollovers are automated!
Multi-Player Structure
• Course
• World
• Firm
• User
Simulation Interface Elements
1. Decision Screens – Enter the values for
all functional areas for the next period
2. Reports – View company results and
analyze for next decision
3. The Advisor - The Mikes Bikes “helper.”
Provides tips and assistance
The Importance of Strategy
• Strategy – How you will achieve your
organizational goals
• Each Marketing, Production and Financial
decision you make ties into your overall
strategy!
• Monitor strategy by constant analysis (via
reports) then make the right decisions
Applying The Strategy
• Big Picture > Main Objectives > Low Level
• Meeting Main Organizational Objectives
– Making Profit
– Having enough Product
– Keeping Customers Happy
The Main Functional Areas
1. Marketing – Advertising, Public
Relations, Branding, Price, etc
2. Production and Operations – Our
capacity to produce
3. Finance – Costs, Cash Flows, Profit
4. R and D – Developing products the
consumer wants
5. HR – Size of our workforce, training, etc
1. Marketing
1. Promotion – Advertising, Public Relations
2. Distribution (Place) – Departments
Stores, Bikes shops, and Sport Shops
3. Price – How much will we/can we charge
our customer?
4. Product – Creating what the consumer
wants
2. Production and Operations
• Plant capacity measured in SCU’s
(Standard Capacity Units)
• Control batch size, set up time reduction,
preventative maintenance
• Forecast sales to determine production
values
• Factory efficiency of 70% - 80% is very
good
3. Finance
• We want to cover our costs and make a
profit!
• We can increase or pay back long term
debt
• Shares can be sold to raise capital, or be
bought back.
• Provide shareholders with dividends from
cash surplus
4. Research and Development
• Modify existing products or create a new
one
• Choose product attributes: Design/Style
and Technical Specs
• Use the product placement and the
perceptual map to determine which
attributes our target market wants
5. Human Resources
• We can increase or decrease the size of
our workforce
• We need to decide how much to pay our
employees
• We need to decide how much we are
going to spend on training our employees
Things to watch for…
• Plant capacity – Too much will be a waste
of resources. Under capacity will result in
not being able to meet our customer
demands (opportunity costs).
• Marketing decisions - Be sure to spend
the right amount of resources in the proper
areas.
Things to watch for…
• Financing decisions - Watch your debt to
equity ratio. Too much debt and not
enough equity will hurt share price!
• Is the price right? – Having a price that is
too low results in lower revenues. Having
a price that is too high results in lower
sales.
• Don’t stock out!
Simulation Schedule
• 2 practice moves
– Fri May 20th, Tues May 24th
• 6 actual moves
– Move 1: Fri May 27th
• Presentations to the board
– Show how your company has performed over
the past 5 periods
The Group Experience
• Do key tasks AS A TEAM
• Listen to everyone’s ideas and opinions
• Deal with situations as the occur
Downloading and Playing
• Download all software and player manuals
from http://www.smartsims.com
• Smartsims e-mail: help@smartsims.com
• 2 team members can register at a cost of
$50 each. This amount is spread over the
team to lower costs
• Smartsims will e-mail your registration
information to you
Downloading and Playing
• Firewall configuration
• Access Multi-player software in 3C13
– UserID: student-01
– Password: NetMike
• Smartsims access:
– Login: stuwinnipeg
– Password: canada
• pjanciw@hotmail.com
Walkthrough
• How to make a round of decisions…
Questions