The Digby computer team will adopt a Broad Differentiation strategy, maintaining a presence in every segment. James Cage (author) from Orlando, FL on November 15, 2013. At the end of the round, Erie can do a comparison price check against the other companies’ products in the Capstone Courier. Note that the highest to lowest market share in units in the competition is Low End, Traditional, High End, Size and Performance. Erie makes improvements for each product to beat the competition in all five segments for the next round. CAPSIM SIMULATION WINNERS!BY: MINHEE HUH, MOLLY MCGOWAN, AND KING TAN 2. Andrews has decided to adopt features from several different basic strategies to form our own hybrid strategy. Our original strategy had failing results and our team placed last at the end of the first round. The industry simulation is the sensor industry. Executive Summary The Digby team will adopt a Broad Differentiation strategy, maintaining a presence in every segment. We want every customer to know about our superb designs, and we want to make our products easy for customers to find. It received a market share 15% within 3 rounds of execution. Example: Increase Daze ' s performance by 0.8 and reduce size by 1.0. When the round is complete Erie can compare the segment performance and size coordinates with the other companies’ segments in the Capstone Courier. Capsim Strategic Management Simulation: First Place. These strategies are Broad Cost Leader; Broad Differentiation; Niche Cost Leader (Low Technology); Niche Differentiation (High Technology); Cost Leader with Product Lifecycle Focus and Differentiation with Product Lifecycle Focus. R&D competency is developed that keeps designs fresh and exciting. Follow the decision guidelines below unless directed otherwise by your instructor. Explanation: Broad Differentiation strategy refers to building a business or a brand that differs significantly from that of the competitor. All five segments: Traditional, Low, High, Performance and Size equals 100%. If a company overestimates sales or spends too much money, current debt may increase. In the Production Margins Area we have listed the total unit cost and contribution margins. The Digby computer team will maintain a presence in both segments of the market. When our cash position allows, we will establish a dividend policy and begin to retire stock. Erie must analyze what the other companies have done with their segments. Let us begin with the Research and Development Module. In the Capsim simulation course at Georgian Court University, Lakewood, NJ in summer session 2012, there are six companies are: Andrews, Baldwin, Chester, Digby, Eire and Ferris (Computer). Premium products for the industry: our brands withstand the tests of time. Erie may be able to increase the contribution margin in some of the other segments but an average of 25% contribution margin in all segments is pretty good. In order for this strategy to work a company has to be aware of what the competition is doing every round. Broad Differentiation Strategy is quite unique and brings about many Examples. Let’s take the Traditional segment which has industry unit sales of 7,387,000 units or 32.4% of the market in round zero. Under the Unit Sales Forecast is the Inventory on Hand. (During the practice rounds, each company is assigned a different strategy.) Our primary stakeholders are customers, stockholders, management, and employees. Enjoy! The prices of products are reduced by $0.50 each year. Moreover, the company will gain a competitive advantage by distinguishing products with an excellent design, high awareness and easy accessibility. Prices are above average. Note that Erie may be able to charge a better price for the High-End, Performance and Size products but the Traditional and Low-End products have to have a more modest price. In CapSim, a firm should launch a new product if: The strategy calls for it in the Team Member or On-Line Guide. This is a competition and Erie has to adjust to the marketplace. The computer will then calculate the unit Production after Adjustment. We simulated developing silicon wafers for 6 rounds representing 6 years. Currently my team is doing Niche Cost Leader (for practice rounds) but finding it very difficult and wondering if we should switch when the real simulation starts. In this manner Erie will have a better product then most of the other companies for the second half of each round (year). Choose COMPXM strategy . Wondering what the easiest strategy is for Capsim and why. When you sell stock in the marketplace this will decreases the price per share of your company’s stock. Access The Broad Differentiation Sample. I usually go for broad differentiation because it is more flexible. The Human Resources Module will be added in the third round. A Broad Differentiator strategy … A final note, this is a competition among teams. We will gain a competitive advantage by distinguishing our products with an excellent design, high awareness, and easy accessibility. After our products are well positioned, we will investigate modest increases in automation levels to improve margins, but never at the expense of our ability to reposition products and keep up with segments as they move across the perceptual map. Erie keys off of the Industry Conditions Report Performance and Size Centers for each round listed for the following segments: Traditional-Eat; Low End-Ebb; High End-Echo; Performance-Edge and Size-Eat. CAPSIM PRESENTATION-TEAM FERRIS 1. Each Industry segment makes up a percent of the market. Differentiation Strategy with a Product Life Cycle Focus. The number 1,231 is placed in the box. There are actual market share units listed in the Capstone Courier. Erie must make a comparison to see what the other companies are promoting. Example: Increase Dixie 's performance by 1.2 and reduce Size by 1.0. The teams will play six rounds in the simulation. In the Physical Plant Section, Erie wants to make sure they have enough 1st shift capacity not to pay overtime to employees. Two competitors are pursuing Broad Differentiator strategies. R&D competency is developed that keeps designs fresh and exciting. Capsim Simulation Broad Differentiation Strategy. We shall use team Erie as an example. Areas we excelled: Standardized and proprietary tools & processes Positioning, forecasting (early rounds) Functional expertise & strong communication Early, aggressive TQM investments - able to lead our segments and achieve higher margins Management Decision Process Cross capsim report 4555 Words | 19 Pages. Erie uses this basic calculation for the other product segments. 12.4 Broad Differentiation. We have six teams in the simulation: Andrews, Baldwin, Chester, Digby, Erie and Ferris. It may be necessary to increase automation gradually over the rounds of the competition. A Broad differentiation strategy maintains a presence in every segment of the market. CAPSIM ANALYSIS: FERRIS 14 700 by the end of Round 8 with a plant utilization of 184%. We will keep our existing product line, and introduce at least one more line, maintaining a presence in both segments. Improve reliability (MTBF) to enhance demand. The Digby computer team will maintain a presence in both segments of the market. Dot - Improve positioning and reduce age. CHANGING STRATEGIES TO MAKE BETTER PRODUCTS• Original Strategy: • Cost Leadership • Differentiation Strategy• New Strategy • Focus Cost Leadership Strategy • Differentiation Strategy 4. In this simulation there are the following modules: Research and Development; Marketing, Production and Finance. Best strategy for Capsim? Automation costs money but a small increase in automation, 0.3 per year may be enough to stay competitive. After the practice rounds, you are free to pursue any strategy you wish, and can abandon the Broad Differentiation strategy entirely. Competitive advantage is gained by distinguishing products with an excellent design, high awareness, and easy accessibility. In the Production Module Schedule the sales forecast carries over to the Unit Sales Forecast. Example: No change required. Dixie - Improve positioning and reduce age. Although the Capstone Team Member Guide recommends a 30% contribution margin in each segment, this is very hard to accomplish during competitive rounds. • Have a pre-grade option that would allow teams to send in their decisions to CAPSIM for a review and recommendations before official submit. 16.4 Digby - Broad Differentiation. Erie Company has to implement a plan to upgrade the performance, size and Mean Time before Failure (MTBF) of its products. The computer will automatically give a company a BIG AL LOAN and the vig (interest) is 7.5%. In the Pro Forma Income Statement make sure each product has a net profit. This practice exercise will help you understand the relationships between business strategy, tactics, functional alignment, and the Capstone® simulation. It is best for Erie to price products at a mid-range in order to be competitive. Broad Differentiation. Our goal is to offer customers products that match their ideal criteria for positioning, age, and reliability. It's a strategy that works better for larger companies than smaller ones. There are six basic team strategies listed on page 24 in the Capstone Team Member Guide 2012. We will use the Digby team for this example. Broad Differentiation. We will attempt to differentiate our product line … SHAREHOLDER MEETING 3. We will finance our investments primarily through stock issues and cash from operations, supplementing with bond offerings on an as needed basis. The main objective of implementing a differentiation strategy is to increase competitive advantage. We are somewhat adverse to debt, and prefer to avoid interest payments. In order to achieve the broad differentiator strategy, a new product was introduced in the high segment i.e. In the High End, Performance and Size segments customers want new and better products. Erie should divide the 7,387,000 units by 6 and make a prediction that Erie will sell approximately 1,231,167 units. 15.4 Digby - Broad Differentiation. Fire was able to produce sales for 1,235 units with its capacity of 14. R & D Round 1 . We will grow capacity to meet the demand that we generate, avoiding second shift/overtime when possible. Dell - Leave positioning alone, allowing the product to age further. A rule of thumb is to keep the contribution margin above 25%. A Differentiation Strategy with a Product Life Cycle Focus seeks to be known far and wide as the top producer of the best performing state-of-the-art products. Not hard to do, since they were incompetent, but it was fun! Daze - Improve positioning and reduce age. This will help each company develop a strategy for the competition. We will price at a premium. Hold reliability (MTBF) steady. We chose broad differentiation as a a strategy. The promotion and sales budgets should be in the mid pricing range. 1. A differentiation strategy is an approach businesses develop by providing customers with something unique, different and distinct from items their competitors may offer in the marketplace. Broad Differentiation Capsim. The teams played two practice rounds before beginning the actual competition. Hence an innovative strategy is highly recommended in order to achieve high business growth, in case you are willing to expose you to a higher degree of risk. These revisions change the Age at Revision for each segment. The industry simulation is the sensor industry. basic capsim strategies.pptx - cost leadership life cycles product developm ent operating factors differentiation market segment factors size broad cost But more important and effective than this is how Nike makes its customers feel. In the computer simulation I would recommend not to buy back stock unless your company has a great over surplus of funds. In the Marketing Module Erie must improve the price of segment products round by round. Erie must adjust the Production Schedule for Traditional-Eat to equal 1,231,161 units. This improves the position of the product, making it more appealing to our customers. This is a rule of thumb when making a Sales Forecast. 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