The Business Strategy Game
• Everyone started with same set of parameters.
What would the other teams do?
• We read the book to see what values or strategies
counted most. All depends on competition
• Prepare our company for future competition. Keep
an eye on competition
Initial Key Strategy goals
• Move towards building an international market
– Plant decisions - build slowly, one step at a time
• Increase productivity and profitability in Ohio by
running factory at capacity
• Open in Asia first, then move into Europe
• This saved import fees and reduced manufacturing
cost
• Most profitable due to low wages
•
• How to finance growth in USA, Asia and Europe
• Issue stock (decreases per share value but is equity
Evaluation year 12
• Evaluated competitor’s strategy to counter threats
•
•
D- strong competition in Europe next year
•
Several teams setup factories in Asia but
forgot to pay workers.
•
• Plant capacity
•
Build in Europe 1,000
•
• We had very low service ratings – stock outs again
Evaluation year 13
•
•
•
•
Evaluated competitor’s strategy to counter threats
A- Building in Europe
a.
Have 2,000 in Asia. Selling @ 37.50
b. Carried large inventory (835) in private label
Selling @ 27.00
•
• Massive building in Europe for yr 14 –10,000
capacity, demand 8,077
• Asia has 11,000 capacity, demand only 5,177
•
• Add automation to Ohio to increase efficiency and
Evaluation year 14
• Evaluated competitor’s strategy to counter threats
– A – moving down but still has 7,000 capacity
• Still carrying large inventory in private-label Selling @ 29.00
• Prices too high in NA $50.00
– H – building in Asia now (1,000) has 9,000 capacity
– B – quality below 50 in private
– Massive inventory (11,209) and (5000) from other
teams can be let loose soon
– Lots of excess capacity worldwide – hold on new
construction
– Raised price in NA to avoid stock out
Evaluation year 15
• Evaluated competitor’s strategy to counter threats
• A – moving up
– Currnetly has 8,000 capacity
– Still carrying large inventory in private-label Selling @
30.00
– Prices too high in NA $50.00
– Low sales in Asia but may be moving up
• H – has 9,000 capacity
– Prices higher in NA and Europe but competitive Watch
for move
– Did not set wages in Asia
• B – quality below 50 in private
– Massive inventory (11,434) can be let loose soon
Summary:
• Slow growth and minor corrections everywhere
rather than jumping in full steam
• Started at sixth place year 11, then moved to third
place year12, and then kept first place remainder
• NOTE: If you would have bought 100 shares of
our company in year 10 at $15.00 per share, today
they would be worth $17,425!!!
Stock Value
$200.00
$150.00
$100.00
Stock Value
$50.00
$0.00
11
12
13
14
15
16
Year
NOTE: If you would have bought 100 shares of our company in year 10
at $15.00 per share, today they would be worth $17,425!!!
Sales Revenue Growth
1500000
1000000
Sales Revenue
500000
0
11
12
13
14
15
16
Earnings per Share
$15.00
$10.00
Earnings per
Share
$5.00
$0.00
11
12
13
14
Year
15
16