My team Digby won the online strategy simulation game.
The game was full of fun and more importantly learning. A lot of the times in my classroom discussions, we have discussed how strategic management sounds like all abstract and gaseous. In this game, I could not only apply my lessons from the strategy course but also could see the results in the game’s simulated markets. Wow! Especially when I could define my winning strategies!
For those who are still wondering as to what is CAPSIM… It is a strategy simulation game hosted on CAPSIM.com and team members act as top management of their respective companies. The teams need to take decisions on R&D, Marketing, Production, TQM, HR and Finance in a simulated market conditions. The teams compete each year on their products in a simulated market.
For those of you who are looking for strategies that I applied in the game. My ten commandments :)
1. Take all types of loans in the initial rounds. These loans should be used in the initial rounds to fund your R&D and automation.
2. Release products in all segments such that they form a diagonal on the perceptual maps of high tech and low tech products. Ideally, one product should be launched each year till year 5
3. High tech products launched initially would slowly move to low tech segments. Keep launching newer ones in high tech
4. Production automation – gradual increase to 10. This is very important to increase contribution margins which are very helpful in later rounds
5. Target 100% awareness and keep spending on marketing till you reach this stage. The spending could follow this
Round when the product is launched – 1700
Subsequent rounds till awareness reaches 100% – 2500
After awareness reaches 100% – 1400 to maintain dominance
Target 100% accessibility and keep spending on sales till you reach this stage. The spending could follow this
Round when the product is launched – 2500
Subsequent rounds till awareness reaches 100% – 3000
After acessibility reaches 100% – 2000 to maintain 100%
6. 1000-1200 is the maximum market share for a product in a competitive market.
7. Sales forecast can be determined by taking the total of potentials for each segment of your product
8. No dividends should be given in any rounds
9. Whenever cash available, buy back the shares. This would increase your share price significantly
10. At each round, keep an eye on Balanced score card proforma. Your target in each round can be
Rounds 1-3 : 40+
Rounds 4-6: 70+
Rounds 7-8: 85+