INSTRUCTOR:
Jill R. Kickul, Ph.D.
Office: Management Department, DePaul Center 7032
Phone: (312) 362-6786
Fax: (312) 362-6973
E-Mail: jkickul@wppost.depaul.edu
Web Address: http://www.depaul.edu/~jkickul
REQUIRED TEXT AND READINGS:
Capstone: Team Member Guide. Park Li Management Simulations and Capstone
Management Simulations (will be provided; can also be downloaded from the CapSim website: www.capsim.com upon registration).
COURSE DESCRIPTION:
This course is designed to integrate multiple areas of specialization within an international business environment. Students will have the opportunity to formulate, develop, and implement strategic issues and concepts for a "simulated" company. In addition, cases will be examined and analyzed that focus on how multinational organizations sustain their competitive advantage within their respective industries.
Throughout the course, we will explore the factors that contribute to the design of an effective strategy and the criteria for making intelligent choices from the many options facing today's organizations. Some of these factors include:
•
Defining the mission statement of an organization
•
An analysis of internal strengths and weaknesses
•
An assessment of competitive position
•
Environmental analysis and appropriate reactions
•
Setting objectives and targets
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•
Formulating organizational and functional strategies
•
Implementation and control
COURSE OBJECTIVES:
1. To understand the factors that contribute to the strategic management process within a multinational business environment.
2. To recognize (a) the relationship of functional business operations to competitive success, and (b) the role of business processes in achieving organizational performance.
3. To learn how to objectively evaluate an organization's capabilities and competitive position and thereby make intelligent choices to establish strategies that achieve defined objectives.
4. To examine alternate strategic management concepts, models, and systems.
5. To develop one's interpersonal abilities by interacting as a team within an organizational setting.
6. To enhance writing skills through a formal analysis of several case studies.
COURSE REQUIREMENTS:
Capstone Simulation:
Most strategic decisions, especially crucial ones, are made after consultation with key executives and colleagues in an atmosphere of committee deliberations and discussion. To simulate this procedure, each student has the opportunity to select his/her team.
Each team has to manage and analyze their own CAPSTONE company and has to develop and implement strategic concepts. The management team will make decisions about various aspects of an assigned company's management for a given period of "simulated time." It is expected that all management teams meet regularly to analyze the strategic position of the company and discuss the issues, problems, etc.
The game is, thus, played over several simulated periods to maximize the firm's objectives. The objectives are, of course, achieved much more systematically and successfully by considering and applying concepts previously developed in lectures and discussion.
The business simulation is graded as the joint effort of the entire team whose members will receive the same grade, unless performance difficulties occur among one or more students.
This approach is designed to foster teamwork, a highly valued requirement for success in business. If you are not a team player but you wish to acquire the necessary skills, this could be a good first step toward that end. The performance of your group in the simulation is worth 15% towards your final course grade. Students will be evaluating their team members at the mid-term and at the end of the class (See evaluation form at the end of the syllabus and on the instructor’s web page). Key note: Peer evaluations are worth 15% towards your final course grade.
At the end of the simulation, all teams will prepare a Stockholders’ Debrief. In addition, a written report of your individual contribution and performance in your group (individual assessment) will also be prepared.
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Simulation Evaluation Criteria:
To evaluate the firm's performance seven criteria were developed. The criteria include profit, market share, ROA, ROS, ROE, asset turnover, and stock price. Each of these performance measures are then calculated in one of three ways: average value, ending value, or cumulative value. Then all of these performance measurements are ranked in each category score 6 to the firm with the highest value, 5 to the next highest, and so on. Finally, these scores are multiplied by the percentages (as assigned by the team) to arrive at an overall composite score. Each team has to assign percentages to each of the seven performance measures. The most that can be assigned to any one performance measure is 30%, and the total must equal
100%. The company will be evaluated using the team's percentage. Before the first decision, please submit the assigned weights your firm chooses to use for each criteria.
For example, suppose your team performed as follows in a six firm industry:
Criteria Method Score Weight Composite
Profit Cumulative 6(1 st
Place) .10 .60
Value
Market Share
ROA
ROS
ROE
Asset Turnover
Stock Price
Ending Value
Average Value
Average Value
Average Value
Average Value
Ending Value
5(2 nd
Place)
3(4 th
Place)
5(2 nd
Place)
4(3 rd
Place)
4(3 rd
Place)
5(2 nd
Place)
.15
.15
.15
.15
.15
.15
.75
.45
.75
.60
.60
.75
Total Score 1.00 4.50
(OUT OF 6)
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DISCUSSION QUESTIONS:
During the class, we will have an opportunity to discuss several questions relevant to organizational strategy (see last pages of this syllabus). Each student should choose two questions to formally analyze and report to the instructor. Each discussion write-up must be typed, double-spaced, and approximately 1000 words.
When discussion questions are assigned during the course, we will spend class time discussing each question in detail. Before a question is to be discussed, the instructor will ask for four to five students to be the “Discussant(s)” of the question to be analyzed. A student should be a
"Discussant" at least one time throughout the course (part of your participation grade). Each
“Discussant” will be asked to lead the discussion of the question and bring in his/her own unique perspective to the situation.
SMALL GROUP AND CLASS PARTICIPATION:
The success of this course depends not only on your attendance, but also on your participation. The more you participate, the more fun and valuable the course will be for all of us. For every class, students are expected to read the assigned text and supplemental readings and cases. Participation is measured using several criteria. These include actively participating individually during the "discussion" part of our sessions, in small group meetings (including interactions on the web site), and in group presentations.
The instructor's evaluation of your participation is worth 15% towards your final course grade, and will be evaluated using these criteria:
•
When questions or cases were presented to the class, how active (as opposed to inactive) was your participation?
•
When you answered questions or commented on reading-related or discussion-related material in class, how accurately (as opposed to inaccurately) did you use concepts previously discussed?
•
When you asked questions or commented on reading-related or discussion-related material in class, how creative (as opposed to redundant or repetitive) was your thinking?
•
When you were asked to answer case questions to solve organizational problems (a career as an organizational consultant offers big buck ($$$!), by the way), how specific, hence implementable (as opposed to vague, hence useless), were your suggested remedies to problems raised in class?
•
When you criticized others' ideas (including the instructor's), how constructively (as opposed to destructively) did you state your criticism?
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•
How many times were you absent when your small group was working on in-class and live case (so that your group missed your contributions)? One group absence may not adversely affect your participation grade; more class absences will lower your final grade.
BREAKDOWN OF COURSE REQUIREMENTS:
Requirements Percentage
Simulation Performance
Stockholders’ Debrief (Team)
Individual Assessment
Simulation Presentation
Peer Evaluations
Strategy Article Write-ups (2 @ 10% each)
Class Participation
GRADING:
A 93-100
A- 90-92
B+ 88-89
B 83-87
B- 80-82
C+ 78-79
C
C-
D+
73-77
70-72
68-69
15%
10%
15%
10%
15%
20%
15%
D
F
PLAGIARISM:
60-67
59 and below
DePaul University has issued guidelines for student responsibilities, provided in the
Undergraduate Bulletin: "Plagiarism is a major form of academic dishonesty involving the presentation of the work of another as one's own." Students should be familiar with this policy and the consequences of its violation.
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FOR THE DAY OF:
Friday, August 25
Saturday, August 26
TOPIC OF DISCUSSION ASSIGNMENTS
•
Introduction to Class and Strategic
Management
•
Formation of Teams for
Capstone
•
Overview of Capstone
•
Company Identification:
The Mission Statement
•
Analyzing the External
Environment
•
Industry and
Competitive Analysis
READINGS
•
Capstone: Chapters 1-5
Class Discussion:
•
Question 1: What is
Strategy?
•
Question 2:
Stakeholders and
Mission Statements
•
Question 3: The
Strategic Discourse
______________________
•
Your selected question #1 due
August 29 th
•
Mid-term peer evaluations due
August 29 th
(on
Capsim website)
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FOR THE DAY OF:
Friday, September 1
Saturday, September 2
TOPIC OF DISCUSSION ASSIGNMENTS
READINGS
•
Analyzing the Internal
Environment and
Establishing Long-
Range Objectives
•
Identifying Strategic
Class Discussion:
•
Question 4:
Competitor Analysis
•
Question 5: Conduct a TOWS Analysis
Alternatives
•
Strategic Evaluation and Selection
•
Implementing Strategy:
Tactical Issues
•
Simulation
Presentations
Class Discussion:
•
Question 6:
Strategies Gone
Goldstar Considers
Entry
______________________
•
Your selected question #2 due
September 5 th
•
Stockholders’
Debrief due
September 9 th
•
Individual assessment due
September 9 th
•
Final peer evaluations due
September 9 th
(on
Capsim website)
Wrong!
•
Question 7: Lucky
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Company Name: ________________________________________
Profit
Market Share
Criteria
ROA
ROS
ROE
Asset Turnover
Stock Price
Total Score 1.00
Weight
8

•
•
•
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Read the following article, "What is Strategy", by Michael Porter. Harvard Business
Review, 11/1/96, Page 61. You can download this article from the HBR website at http://www.hbsp.harvard.edu/hbsp/prod_detail.asp?96608.html.
If you are employed, reflect upon the current state of your industry and your company. If you are a full time student, or if you prefer not to discuss your company, reflect upon
Amazon.com and the retail bookstore industry. Write a 1000 word essay addressing the issues in Porter's article. In your essay, would you say that your industry (or Amazon) offers a variety of available strategies? Is your company (or Amazon) pursuing a strategy? What would an Activity System for the company look like? Would it look different from those of the competitors? Would you say the company strives for cost leadership, differentiation, or focus? Does it have a strategic position? What trade-offs has it made? Has it fallen into a growth trap?
Mission statements are usually perceived as a declaration of what the company does, how it does it, and why it does it. Like an iceberg, however, what you see on the surface does not give a sense for the entirety. To truly understand a company, you must see the mission statement as a compromise between interest groups, often referred to as
“stakeholders”. Stakeholders include managers, employees, customers, government, stockholders, etc. They also include groups that have little “say” in business matters on the surface, but which can have great pragmatic “say” in what the company can do -- for example, political parties, the Kyoritsu, unions, lobbyists, the press, the military, the cartel, the founder’s family, etc.
List ALL of your company’s stakeholders. (Or pick a company or organization.) Define them if necessary. Rank order them in terms of importance. Then make a few discerning comments in response to these two questions:
1. Are the top stakeholder groups represented in our firm’s mission statement?
2. Are these stakeholder groups represented in our firm’s daily practices?
Limit your response to 1000 words.
All organizations develop a special language around their strategy and tactics. For example, if you listen to the conversations of government employees, you might hear references to the names of forms – a DD214, 10-K, or Green Card. A baseball team will speak of ERA. A bank might refer to a “credit screen”.
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All disciplines depend upon their special languages. Consider the languages employed by lawyers, doctors, soldiers, architects, electricians, or computer programmers. Business strategists have their special language, too. Say “SWOT analysis” to any MBA on our planet and they will understand you. Say it to any other professional and they might think you were examining a flattened mosquito.
Special languages develop because they offer powerful shortcuts to understanding and analyzing a situation. The richer the language, the more refined the distinctions. The better your understanding of language, the higher your competency.
In business, however, we discover a paradox. A rich strategic language can do as much harm as good to an organization. Indeed, the richer and more specialized the language, the more difficult it may be for the organization to grow or succeed. This happens because special languages exclude people who do not understand the terms. It creates inner circles and outer circles. Mistakes happen which can be traced to misunderstandings. To make things worse, old companies have terms in their language that can be traced to long ago events, or cultural shades of meaning. New companies must spend time creating shared understanding.
In 1000 words, explore this topic as it applies to your organization (past or present.) List ten or so special terms that apply in your company or industry that would confuse outsiders. Are these terms understood at all levels of the organization? On a scale of one to ten, where one means poor and ten means excellent, rate the level of shared understanding around these terms from the top level of your organization to the bottom.
What implications might this have for a merger or acquisition? Does the language limit your access to new talent?
Choose one of your Capstone competitors. If other members of your team are doing this assignment, then each person on your team should pick a different competitor if possible.
For your competitor:
1. Give a short description of their current strategic position -- products, segments, plants, capital structure, source of competitive advantage, etc. Consider their product line from a
“consumer reports” standpoint.
2. Assess their current opportunities and threats. Given the segments they have settled upon, how big is their universe? What is the profit potential? Can they maintain a competitive advantage?
3. Predict their sales and profits for the ending year of the simulation.
4. Indicate the performance measures this team should use to assess themselves.
(Cumulative profit, market share, ROA, ROE, ROS, Asset Turnover, Stock price.)
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Present your analysis in a 1000 word essay.
As discussed in class, conduct a TOWS analysis of your company. Make sure to include all the relevant information used in class. Based off of your analysis, give at least 4-5 recommendations that your company should do in the last rounds of Capstone.
Strategies Gone Wrong!
Consider how often excellent companies make strategic mistakes. In the early 1980's
IBM gave up a commanding lead in personal computers. Quaker Oats acquired Snapple, only to divest them for a fraction of the purchase price a few years later. In the period just before facsimile technology became widespread, Federal Express dumped millions into an effort to develop facsimile technology, with the thought of faxing high quality reproductions from point to point and then delivering the documents with a local truck fleet.
Strategies often go wrong. Part of your job as a manager is to diagnose the mistakes of others in the hope that you can avoid them. The financial press delights in these sorts of stories. They fill the archives at www.businessweek.com, www.fortune.com, etc. Pick a story, then in 1000 words summarize the strategy and diagnose what went wrong.
Alternatively, if you have experienced a strategy gone wrong from inside your industry or company, describe what happened and what went wrong.
Lucky Goldstar Electronics is investigating our Capstone industry looking for a means to enter our market. Visit http://www.megastories.com/seasia/skorea/chaebol/chaebol.htm to read more about the South Korean conglomerates and Lucky Goldstar.
Develop a 1000 word response position for your company to consider. For example, consider the following issues.
As an industry, have you developed a barrier to their entry? That is, would it take a considerable period of time and money before they could successfully enter the market?
Has your company developed a competitive advantage?
Have you developed a core competency?
Acquisition is the most likely means for them to enter this market. Which company should they purchase? What makes that company most attractive?
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From a cultural standpoint, how well would your American management and workforce fit in with Lucky Goldstar’s management philosophy and approach? Which of your competitors would best fit with their strategic objectives?
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