1 page conclusion and 2 slides narrated PPT

Contents Executive Summary 3 Company Organization 4 Chester Organizational Chart 4 Team Effectiveness 5 Team Charter Assessment 5 Porter’s Generic Strategy 5 The Target Market Segment 6 The Project Plan 6 Conflict Management Plan 8 Team Rules 8 Ethical Responsbility 8 Critical Success Factors 9 Competition and SWOT Analysis 9 Industry Analysis 11 Conclusion References

Executive Summary

The government decided to split a monopoly within the sensor industry and there were six teams that were created to compete in the sensor industry. Our team Chester began our first year on a financial level trying to compete with our competitors, which were Andrews, Baldwin, Digby, Erie, and Ferris. As to every company, there were issues that the Chester team faced in order to compete among the mentioned teams. Each team involved was faced with decision-making tasks to improve their standings in the market by trying to improve their sensor products, marketing efforts, finances and productions over an eight-year time span. This report will show how the Chester team competed with the other teams and where we stood within the eight years of our product from start to finish.

The sensor market evolved and the Chester team was faced with two types of markets, the Low tech, and the High tech markets. Within these two markets, there were concerns due to each market having its own specifications of what the customers wanted from a product. Team Chester had to keep a close eye on our competitors during each year so we could meet the needs of our customers. Team Chester initially started by using the Broad cost leader strategy for the low-cost product in each of our segments of the market. We decided we wanted to have great profit margins while keeping the price on our sensors low for the customers that are price sensitive. Our company had the ability to reposition our product rather than introducing new ones to the market.

From the beginning to the end, team Chester shows how our business developed from being on an equal field with our competitors, to how we ended with our market shares of both the high and low-tech products. We show how we first started out, which was on an equal level with our competitors in the market share which began at 16.7 % and how our company progresses with minor issues resulting in emergency loans and how team Chester competed with the other teams.

Company Organization

In team Chester, duties and responsibilities were decided on democratically. Everyone had a voice in what duties were assigned to whom and decisions were made as a team. Each member was given roles and responsibilities such as Team Captain, Scribe, Conflict Resolution Manager & Administrator, Presentation Wizard, and Technology Guru. These roles allowed team Chester to run efficiently and make sure everyone contributes and an equal share of responsibility. All decisions were made live over conference calls on Tuesdays and Thursdays to ensure everyone was in agreement with team decisions.

Chester Organizational Chart

Team Effectiveness

Overall, team Chester’s strategy and team effectiveness was very good. Team Chester was able to successfully launch two products and ended up among the top companies. We started with Cake, which was our Low-Tech product and later started Cone, which started as High Tech and then moved to Low Tech in order to generate more sales. Team Chester worked well as a group and everyone did their best to make it to weekly conferences and ensured that the weekly assignments were completed and turned in on time. Our goal was to finish this course with a successful business, and we achieved our goal.

Team Charter Assessment

Porter’s Generic Strategy

Initially, we put in our charter that we would use the Broad cost leader strategy. Broad cost leader will be a low-cost product in each segment of the market. We want to have great profit margins while keeping the price low for those customers that are price sensitive. Our company would have the ability to reposition our product versus introducing new ones to the market. We also noted that today’s high-end item will become tomorrow’s low-end item. Our company’s initial priority was to evaluate our current products as we moved to develop the next high-end product using the latest technology. We wanted to evaluate the assets and liabilities to effectively make the decisions if divesting a low-end product in favor of a high-tech product would be necessary.

As soon as round one of the CAPSIM was completed our company agreed that we needed to immediately put a high-end product on the market and put one into research and development in round two with sales beginning in the middle of the year of round three. Later after suffering an emergency loan, we changed -our strategy and our high-tech product to a low-tech product. While this was risky and not recommended, we were successful with the switch in the end.

All companies targeted the same two markets, so it was difficult to figure out the best way to be the leader of any market. For the first and second rounds, we concentrated on the low-tech market with our one product. In the third round, we were able to introduce a new high-tech product in the middle of the year and jump right into sales, appealing to our customer’s needs, and selling out right away. We did not introduce another new product into the market and adapted our second product, cone, to appeal to the low-tech market in round seven hoping to gain an advantage in the low-tech sector.

Chester decided after the charter was submitted to modify the meeting and communication schedule. It worked better for the company to hold conferences twice a week as the primary means of communication and use text messaging to message each other and send reminders. The company effectively used the document and change management as written in the charter but did not follow the posting timelines. The company decided to modify deadlines based on requirements for the week. The company did also not follow the weekly task schedule as indicated in the charter as far as the targets for having the final paper complete. We had a hiccup in round six by not instituting a good checks and balances system and relying on one team member to make the decisions himself. This ended up hurting the team and was not the best decision to make. The company needs to establish rules that require a minimum number of board members present to make company decisions. We did not use any project management skills for our project plan. Project management planning would have helped if a more detailed project plan were developed.

Conflict Management Plan

Just like any new company’s conflict management plan, Chester realized there were some changes that could be made to make it better. Although there was only one team conflict, the conflict management plan does not have an accountability standard besides emailing the professor. The plan stated that if a member does not complete the work by the team goal of Thursday evening, members will need to advise and see where they can help before the workload is too much. There is no plan for when a member completely misses an established deadline.

The team had a good set of rules for a new company. There were sixteen rules that were included. The team abided by the rules and accepted responsibility and accountability when necessary. An example of this is when James told the team he would submit decisions for the the weekly simulation assignment but failed to do so in time, he accepted full responsibility. Another example was how the team never discussed politics or religion. This resulted in social intercourse among the board members. As the company aged, the team would be best served by reviewing the rules and updating them as needed to remove outdated information or change or delete outdated rules.

As stated in the CAPSIM primer, ethical decision-making is the process in which it is determined what actions will be taken to address an ethical issue. An ethical issue is an action that may benefit or harm others. We learned that in order to be ethical a decision should be legal and morally acceptable. Chester maintained social responsibility throughout the course so far and no decisions made by the board or members of the board could be seen as unethical to the shareholders or the customers.

Critical Success Factors

Some of our critical success factors were communication, product awareness, product availability, producing a product within the demands of the customer, delivering products at a price within our customer’s expectations, keep demand high, production costs, and labor costs low. These factors will not guarantee you success, but they contributed to making team Chester successful. Team Chester had great communication and made sure that everyone was on the same page. We did well making sure our products had 100% awareness and 100% availability. We produced products within the size and performance of our customer's needs and wants. Chester also stayed competitive with the prices of our products and created more profits by keeping product and labor costs to a minimum.

Competition and SWOT Analysis

Several large vendors have made the sensor market competitive globally. Players in this market use strategies such as innovation, mergers, and acquisition, investing in research and development as well as a cost-effective product portfolio to remain relevant in this market. Various brands have been established both domestically and globally and new entrants form a competitive landscape. However, the Sensor industry has faced competition from other firms producing alternative products. These companies are Rubidium, Amblit technologies, Almawave, and Pindrop among other firms (Yang et. al, 2015).

There were five competitors in CAPSIM that our company had to work to identify what strategies they were using and how they were investing in their products and research. Our company quickly determined that we really needed to monitor the activities of only two of them, Baldwin and Andrews. In the end, these companies proved to be our fiercest competitors. Baldwin finished on top with a 29.3% market share and Andrews finished with a 16.4% market share. It must be noted that Ferris finished with 16.9% of the market share but their contribution margin was low and they tried to stay at the edge of cutting technology. They were unable to position their products well enough to completely take over the high-tech market while keeping their price $4.50 below the top competitors. Ferris’ had no products in the low-tech market. Our company identified that this was a major mistake. The company did not understand that today’s high-tech product is tomorrow’s low-tech product.

Team Chester evaluated the simulation report from the previous completed round in order to make a good decision on research and development, marketing, and production. An example of our thought process is further explained as we discuss our round three decisions. In round two our company produced 1,584 units of “cake” and sold 1,657. We did not forecast correctly and sold out. The only product that did not sell out was from our competitors in the low-tech industry was “eat”. Eerie produced almost 1,100 units and still had 117 left in inventory. It was important to look at why they did not sell out to ensure we do not make a bad decision that would result in the customer buying nothing instead of their product. We discovered that team Eerie had a good product but failed in customer accessibility and customer awareness. We then looked at the percentage growth rate expected for the next year to make a good decision on how many we might sell. Our forecasting showed that we could produce 300 more units in round three and sell more than the other companies. We produced 1,880 units and still sold out. We produced more products than any of the other teams and ended the round with the majority of the market share.

Strengths

Human resource focus

Total Quality Management is important

Weaknesses

Inexperienced board members

Trouble forecasting resulting in continuous stock-outs

Emergency loan

Opportunities

Increase Market share through better forecasting

Introduce new products

Increase automation

Threats

Competitive Market

Automation costs

Employee turnover

Industry Analysis

Globally, the sensor market in the year 2017 was valued at $138,965 million. This is expected to rise to $287,002 by the year 2025. The market share is expected to expand at 11.60% over the period 2017-2023 resulting from technological advancement. The causes of growth in this industry are increasing demand for automation and control, the need for real-time systems of monitoring and the growth of internet connectivity. The regional market for this industry is America, Europe, Asia Pacific, RoW, the Middle East, and Africa. The target clients are network operators, mobile manufacturers, security agencies, government agencies, device manufacturers, communication operators, and defense (Lin et. al, 2016).

In CAPSIM the demand for growth was ten percent each year for low-tech products and twenty percent for high tech products from 2019 through 2027 and is expected to continue at that rate for the foreseeable future. The top three companies controlled just below seventy percent of the market share. At the current rate of growth, it is expected that this industry will need at least 28,023 low-tech sensors and 24,091 high tech sensors in ten years.

When conducting research in CAPSIM, Porter’s Five Forces Model has been proven in providing quantitative and qualitative results. We must look at the rivalry among existing competitors, the threat of new entrants, bargaining power of buyers, buyer’s ability to substitute, and the bargaining power of suppliers.

We can examine the rivalry among existing competitors by determining the number of competitors (6), industry growth (10 % low tech and 20% high tech), brand loyalty (cake is near the top of competing products and cone is near the bottom in the low-tech industry), quality differences (the most purchased products have a 20,000-hour reliability), and how crowded the industry is (low tech market producing enough but the high tech market is selling more than can be produced).

The threat of new entrants is determined by brand loyalty. “If you have strong and durable barriers to entry, then you can preserve a favorable position and take fair advantage of it (BillT, et al.).” In Capsim, this can be measured by the customer satisfaction ratings of the products. As noted in the previous paragraph our brand loyalty is great on cake and not very good on cone. We must work to improve cone or remove it from our inventory before it starts costing us money. In round eight, we did sell out of the product with 1,528 being produced and a contribution margin of 30.3%.

The bargaining power of buyers can be determined by looking at the number of customers, the differences between competitors, and price sensitivity. We practiced price sensitivity in round eight by running a sale on cake at $3.00 below Baldwin, who has the highest market share. This allowed us to sell out of the product and still a healthy contribution margin of 44.3%.

The buyer’s ability to substitute is abundantly clear. With six companies producing very similar products, substitution is rather easy. It is important to maximize customer accessibility and customer awareness. The three top companies maintained 100% in both of those areas in round 8 while the company with the least amount of the market share had a 91% accessibility rate and a 63% average customer awareness rate.

The bargaining power of suppliers is the polar opposite of the bargaining power of buyers. This refers to the availability of suppliers, their product uniqueness, and their size. The six competitors in this industry must compete with suppliers to obtain products to make their products. The price our companies pay for our supplies directly affects our asking price and contribution margins. In order to stay competitive in the industry, we must maintain a minimum of a 30% contribution margin. Ferris could not get a contribution margin above 30% when they were paying around $18 for materials per product and sell them for $40.50 a piece. In comparison, the most our company paid for material costs were $11.43 a piece for cone. We sold the product for $35 and still were able to maintain a 30.3 contribution margin.

References

BillT, Narinekan, Midgie, Mind Tools Content Team, Mind Tools Content Team, & Mind Tools Content Team. (n.d.). Porter's Five Forces: - Understanding Competitive Forces to Maximize Profitability. Retrieved from https://www.mindtools.com/pages/article/newTMC_08.htm

CAPSIM Mgmt. Simulations. (n.d.). CAPSIMCore. Retrieved November 21, 2019, from https://ww3.capsim.com/student/portal/index.cfm?template=dashboard.

Lin, C. C., Deng, D. J., Chen, Z. Y., & Chen, K. C. (2016). The key design of driving industry 4.0: Joint energy-efficient deployment and scheduling in group-based industrial wireless sensor networks. IEEE Communications Magazine, 54(10), 46-52.

Quality Assurance

James Woods

Human Resources

Lijy Abraham

Research and Development

Vice President

Angelina Trombello

Marketing Vice President

Kevin Shelton

Production Vice President

Connie Jones

Finance Vice President

Lijy Abraham

President & CEO, Team Leader

James Woods