Accounting/Finance Practices Project 1/4 One person needed for all assignments
momoluv08
mgt_slp1_overview.docxThe SLP for this course requires that you participate in a simulated business exercise. Simulations are interactive, allowing you to see – and learn from – the results of your decisions. Moreover, you are able to repeat the simulation, improving the quality of your decisions, learning from past mistakes.
Speaking of mistakes, Joe Thomas had been the V.P. of Marketing for the Clipboard Tablet Company during the four-year period of 2012 through 2015 inclusive. Suffice it to say that the pricing and R&D strategy used by Joe Thomas throughout his four-year tenure was a disaster. Indeed, year-over-year, the company’s performance has declined significantly. The inevitable result: Joe is fired on Dec. 15, 2015.
You are hired to replace Joe – and this, just as the company faces the prospects of another dismal new year – to begin 2016. Mysteriously, you are caught up in a Time Warp, in which you are taken back to January 1, 2012. While you find these circumstances to be very strange, you recognize that they do give you the opportunity to erase the past four-year history completely, redoing the unfortunate decisions that have been made by Joe Thomas over the last four years. As a recent MBA graduate, you are excited by the opportunity, because you know that you have the requisite knowledge and the skill set required to vastly improve the performance of the Clipboard Tablet Company.
In this simulation, you will be examining income statements and marketing reports to assist you in making decisions about pricing, product development (R&D expenditures), and product life cycles.:
Simulation
To begin the MGT599 SLP sequence, you first need to first run the simulation using the Default Decisions. In other words, use the prices and R&D percentages that are already there (do not change any decisions made by Joe Thomas).
Capture or collect the results for each product (X5, X6, and X7) for each year that you run the simulation. Copy (using Excel, by hand, or some other method) the financial results and marketing results, as well as the information provided by your Advisor.
REQUIRED READING:
Read the following scenario carefully before you proceed:
SCENARIO
It is December 15, 2015. Joe Thomas, the VP of Marketing at Clipboard Tablet Co., is smugly patting himself on the back for how well he has done with pricing and product development on the three products, X5, X6, and X7. Of course, Joe knows his strategy was not creative at all – i.e., he did not change any prices or R&D allocations over the four-year period (actually six years, counting 2010 and 2011). But he is certain that he really did not need to change anything anyway, and that his overall performance is proof of his good work.
Sally Smothers, the CEO of Clipboard Tablet Co., knows better, and she fires Joe (but why did she wait so long?).
You are hired to replace Joe. And now, here you are, on Dec. 15, 2015, as the V.P. of Marketing of the Clipboard Tablet Co. You are ready to move the company ahead into 2016. Your boss, Sally Smothers, expects you to make intelligent and informed product development and pricing decisions (after all, you are an MBA).
Session Long Project
Write a 6- to 7-page paper (not including cover and reference pages), using Sally’s instructions, which follow:
Sally asks you to review the past four to six years to see what was going on in terms of product development, sales, pricing, and performance. You collect all of the data and write a report (your report is due on Sally's desk by January 2, 2016).
Using the default decisions (i.e., make no changes within the simulation), analyze Joe Thomas's decisions and results, and then write the report that Sally is requesting. Access the simulation site and collect the data for each year (or you can download a copy of it - see below). Determine where you believe Joe went wrong, and propose a new strategy. Support your revised strategy using financial analysis and relevant business theories.
KEYS TO THE ASSIGNMENT:
The key aspects to this assignment that are required to be covered in your paper include:
1. A review of each product – X5, X6, and X7 – its life cycle, and how each product stacks up in terms of price and performance.
2. Financial review for each product – X5, X6, and X7 – sales, costs, profitability, prices, unit margins, etc.
3. Market review: New Sales, Repeat Sales, Market Saturation, etc.
4. Propose an alternate strategy: A general idea of how you might do better with these products: what pricing and R&D allocations, etc., you would have put in place over the last four years, 2012 – 2015. In short, what would you have done differently than Joe Thomas at each decision point? Be specific!
NEED TO BRUSH UP ON CVP ANALYSIS?
The following link will provide a CVP refresher:
Rehman, A. (2014). Cost-Volume-Profit relationship (CVP Analysis). Accounting for Management. Retrieved on August 27, 2014 from http://www.accountingformanagement.com/cost_volume_profit.htm
BECOME FAMILIAR WITH THE SIMULATION
Visit the simulation here: https://forio.com/simulate/michael.garmon/tablet-development-sim/simulation/
You will see the simulation interface, which provides you with information about the Clipboard Tablet Company, as well as the input interface to implement your strategy (pricing decisions and R&D budget allocations).
Explore the interface, and become familiar with it and the information it provides. The left-hand menu includes these options:
Each time you open the simulation (or when you reset it to play again), you will begin at end of the year of 2011, and the data you see will show the results for 2011 and 2010. When you run the simulation, you will always run it for the four-year period of 2012, 2013, 2014, and 2015. At the end of each year, you will see the results for that year and the previous year.
