Capsim stands for captive simulation. This is a challenge for the Capstone and Foundation alumni, where they compete twice every year. The competitors are tasked with running multi-million dollar companies that have been simulated. The winner is crowned globally.
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This business simulation experience gives the participants a learning opportunity shared with other students across varying time frames. It is among the best interactive online simulations.
Firstly, read the Capsim booklet. This is very important as you will get all the information on the competition. You will be able to understand the purpose of the game and your role in it. Read it as many times as possible until you are conversant with what is required.
It is essential that the team members are placed in their correct positions. For instance, a marketer should not have a financial position, not unless the person is good at both. In case you are alone, use the booklet for guidance.
In addition, be very aggressive and listen to your professors. Carry out sufficient market research to know how and where to invest in. Know your competitors well. Take time to learn about previous competitions and how they turned out. Find out ideas that can make you be a winner. General rule-never underrate your competitor.
Consider taking all the loans and investing in the initial rounds. Use the loans to fund automation. This will enable you to plan for the next rounds. Automation is necessary for the success of your business.
Automation cut down labor cost by as much as 80% depending on the level of automation. Therefore, it is one of the strategies that you should consider, especially in low-end products where competition is based on pricing.
To achieve customer satisfaction, release new products in high-tech. Keep launching new products because the high-tech customer requires newer, smaller, and better performing products.
Move products from high end to tradition if they cannot meet age specification as they age. Doing so will improve your competitive advantage in the traditional market segment since two products combined marketing budget results in better accessibility and generally better success rate.
Gradually, increase your product automation. This, in return, will affect your level of production and, most likely, be disadvantageous to your competitor. Efficiency is vital for customer satisfaction. Do not buy a high automation level once since it is very expensive, and it can disadvantage other departments thus resulting in poor performance.
Make achieving 100% product awareness your target. Use all possible means to accomplish this goal. Once your customer knows what you have to offer, chances are higher that they will come for the product.
Invest in rigorous advertising to achieve customer awareness. Achieving 100% awareness is easier. Achieving 100% accessibility is very difficult. But if you want to outshine your competitors’ especially in high-end segment and tradition, ensure you have at least two products. Having two products boost your ability to attain high accessibility faster.
Do not rely on shares for financing. Instead, use bonds and only issue dividends when you are certain about high returns. With good strategies, high sales will result in high retained earnings and will greatly assist in financing facility improvement.
TQM will be introduced in round 4. TQM has a higher advantage when you use it correctly. One of the important elements of TQM is the ability to reduce cycle time, meaning that your newer design will be rolled out faster, thus increasing your chance of selling more.
Spending 4000000 for each strategy in three rounds can greatly assist you in improving performance by cutting down costs and increasing demand. You should note that TQM spending has a diminishing return factor, and thus you need to be careful not to spend too much for nothing.
The best strategy is to spend 1500000 in round 4 and 5 per each strategy and then spent 1000000 in round 6.
Forecasting is the key to avoid excess or too little inventory. Don’t be too optimistic or too pessimist. Instead, use information about the next round expected sales and your current sales. You can take expected market growth and allocate based on market share for each company and add to your current sales amount to get future forecasts. You can also evaluate your competitor and predict if they will be stronger or weaker next year and thus add your expected sales growth accordingly to your future sales forecast.
This comes in handy when you are out of cash. The cash flow statement will enable you to diagnose your emergency loan. An inflow will be shown by a positive number, whereas a negative number indicates an outflow. Get additional inventory results to attain cash outflow. Subsequently, selling out the entire old inventory generates cash inflow.
The following are situations that should lead to an emergency loan:
-Your unsold inventory winds up in the warehouse. This will mean you have to get cash to purchase new inventory.
-You neglected or forgot to fund major plant improvements. Most times, 25% of emergency loans cater to the required plant changes and adjustments.
-You had negative profits hence depleting your cash reserves. 5% of the emergency loans can be used for this.
It is important that your plan gives customers what they want. To be able to do this, you will need to find out the customers’ needs. It may be challenging to provide exactly what your customer is looking for but make it your priority to beat your competitors at it.
Find out what others have done before you make changes. Research is the key at this point. Pick out the best ideas that will work in your position and assess them for any weaknesses.
Monitor your competitor through the Capstone Courier. This way, you will be able to know their Capsim strategy plan and use the information to your advantage.
Winning this challenge is entirely dependent on your efforts at the implementation of the best research findings. Avoid emotional reactions and look at the bigger picture with every move.