University of Alaska-Anchorage College of Business

University of Alaska-Anchorage * College of Business & Public Policy M A R K E T I N G M G T. * Marketing Management Simulation * S I M U L A T I O N Course Intro & Overview

M A R K E T I N G M G T. Professor Ed Forrest S I M U L A T I O N • Telephone: (cell) 854 -8784 • Email: ejforrest@ uaa. alaska. edu

M A R K E T I N G M G T. S I M U L A T I O N • Overview: of Course – Organize Companies/ Register w/ Capstone • Overview: Market Structure & Demand * Segment Positioning & $Value • Overview: Financial Situation Analysis

M A R K E T I N G M G T. S I M U L A T I O N Your “study” of business … piece-meal & in isolation!

M A R K E T I N G M G T. Marketing S I M U L A T I O N R&D Production Finance HR

M A R K E T I N G M G T. S I M U L A T I O N Lecture-Learning

M A R K E T I N G M G T. Learning & Retention 5% S I M U L A T I O N +% 75

M A R K E T I N G M G T. S I M U L A T I O N

THE CAPSTONE SIMULATION Most widely used Business – Simulation Program in the World • Adopted by major Fortune 500 companies. . General Motors, General Electric, Honeywell, Dell, John Deere, Citibank, Alcoa, BP, Allstate, Samsung, Goldman Sachs, Microsoft…

M A R K E T I N G M G T. • Simulation proffers you opportunity to experience every key dimension of strategic thinking developed to date: S I M U L A T I O N Strategic Thinking the ten big ideas

Economic Environment Moderate growth, Low inflation, Averaged interest • rates • No outside competitors or product substitutes • No economic downturns

Sim designed this way for one reason: Whatever happens will be result of yourtactical execution of strategies… not by external

You Da’ Boss … run a $100 M business ….

Your Product Line: SENSORS:

YOUR JOB: • Make every decision • In every Functional Domain • to create, produce & successfully market your products…

…success contingent on strategic integration of decisions across all domains: M A R K E T I N G M G T. S I M U L A T I O N

You will Compete against other members of this class –running 5 other Corp’s …. • Andrews M A R K E T I N G M G T. S I M U L A T I O N • Baldwin • Chester • Digby • Erie • Ferris

Plus-- You will Compete Against Everyone Else in the World. . . your decisions & performance will be compared against 1000+ other teams competing at other universities… around the world M A R K E T I N G M G T. S I M U L A T I O N

M A R K E T I N G M G T. S I M U L A T I O N & How –to date-have we fared in this World. Wide Competition? ?

M A R K E T I N G M G T. S I M U L A T I O N

M A R K E T I N G M G T. Spring 2016 S I M U L A T I O N • • 1 st & 6 th in ROA 3 rd & 4 th in profit; 8 th & 9 th cum profit, 5 th ROE; 4 th & 8 th ROS; 5 th in Stock Price 4 th in Asset Turnover

#1 Fall 2014 M A R K E T I N G M G T. S I M U L A T I O N Profit for Round 8 - Mean - $ 16, 856, 185 Top Ten Active Teams Professor School/Course Simid Team Value 1 Edward Forrest University of Alaska-Anchorage - Main Management Simulation C 65883 Chester $ 179, 894, 270 2 Montchai Pinitjitsamut Kasetsart University - Main Ag. Strategy 1 C 63414 Erie $ 150, 718, 034 3 Erin Nelson De. Paul University - Main GSB 599 C 66845 Erie $ 117, 376, 727 4 Veer Mehta Great Lakes PGPM - Main Great Lakes PGPM C 66539 Chester $ 102, 062, 415 5 Michael Stoica Washburn University - Main Strategic Analysis C 66272 Baldwin $ 100, 603, 573 6 Vasant Sivaraman S. P. Jain Institute of Management and Research - Main Decision Analysis (Business Simulation)- C C 65322 Chester $ 99, 817, 375 7 Igor Gvozdanovic Zagreb School of Economics and Management - Main Maximizing and Measuring Corporate Value_CAPSTONE C 67613 Andrews $ 97, 578, 131 8 Veer Mehta IIM Shillong - Main IIM Shillong C 61259 Chester $ 97, 216, 158 9 Erin Nelson De. Paul University - Main GSB 599 C 66845 Chester $ 96, 520, 602 10 Dharam Pal BIMTECH India - Main BIMTECH India C 65546 Chester $ 95, 719, 172

As Well As…. previous “Top 10” Finishes : M A R K E T I N G M G T. • • • Spring : 2001 - 5 th Profit Spring : 2003 - 9 th Cum Profit Fall : 2005 - 1 st Profit Spring : 2006 - 5 th Cum Profit & 8 th Profit Spring : 2007 - 3 rd Profit Fall : 2009 - 1 st Cum Profit & Stock Price Spring : 2010 - 9 th Asset Turnover; 1 st, 6 th & 8 th ROE Fall : 2010 - 6 th Cum Profit Spring : 2011 - 3 rd & 9 th ROE; 8 th ROS; 9 th Cum Profit Fall : 2013 - 4 in & # 10 in profit #5 in Stock Price #6 in ROE #3 & #7 in ROA #8 in Asset Turnover S I M U L A T I O N

M A R K E T I N G M G T. S I M U L A T I O N

M A N A G E M E N T S I M U L A T I O N You are now the Captain… . . . How’s your Company doing?

The Big Picture Situation/SW OT Analysis Strategic Planning • Company • Consumers • Competitors • Conditions • PEST Growth & Competiti ve Strategi es Function al Integratio n Function al Integrati Marketin on g R&D Producti on HR Finance Performan ce Assessme nt Ø Profits Ø Mrkt Share Ø ROA Ø ROS Ø ROE Ø Asset T/O Ø Stock Ø Mrkt Cap

st Organize 1 Companies Register @ http: //ww 2. capsim. com/login/

M A R K E T I N G M G T. Strategic Thinking- the ten big ideas S I M U L A T I O N Prof Thomas/ Penn St. able to predict final standings w/in 1 place 90% of time –after observing initial group interaction. . . 7. Corporate culture & 8. Leadership craft. . . Leaders responsible for assuring strategy links values & vision. . .

M A R K E T I N G M G T. S I M U L A T I O N • Overview: of Course – Organize Companies/ Register w/ Capstone • Overview: Market Structure & Demand * Segment Positioning & $Value

Strategic Plan Answers 3 Critical Q’s: 1. Where are we now? = Situation Analysis 2. Where do we want to go 3. How do we get there?

Market Segments: • Big, old & cheap • high-reliability & performance • proven sensors w/ current tech • advanced sensors w/ focus on small size • cutting-edge in both size & performance

Consumer Buying Criteria

5 SEGMENTS

DEMAND ANALYSIS: How Many Sensors / Segment want to buy across next 8 years: Multiply the Round 0 demand by the growth rate and add the result to the Round 0 demand. This will give you a close approximation of Round 1 demand. Copy this number into the Demand cell for Round 1. If you prefer, you can use the following shortcut. For example, assume the Traditional growth rate is 9. 2%. Convert the percentage to a decimal (9. 2% = 0. 092) and add 1 to it (1. 092). Multiply the Round 0 Traditional demand by 1. 092 then round to the nearest whole number. This will give you a close approximation of Total Industry Demand for Round 1.

SENSOR INDUSTRY ONGOING GROWTH. . the entire market growing at around 14 - 15% per year.

Cheaper too-$. 50 drop in price/year Drift Demo

MARKET SEGMENT VALUE Herein- is an example of relative dollar value of each segment at present (year 0) and 5 years out.

Round 0 $$ Values Round 8 $$ Values 10. 5% 10. 2% 33. 3% 23. 5% Low End High End 15. 6% 14. 8% Traditional Performance Low End High End 15. 8% Performance Size 30. 3% Traditional Size 19. 7% 26. 1%

M A N A G E M E N T S I M U L A T I O N Questions?