Demand Equations Which Include Product Attributes

This paper presents a demand model which combines the normal economic factors such as price and advertising with a set of physical attributes of products in establishing the market share allocations as well as the aggregate levels of demand for business simulations. The usual assumptions of demand equations used in simulations. multiple firms producing homogeneous products and selling to a single market. are expanded to a more realistic representation of an actual market place. Multiple market segments exist, each with their own preference mapping. Different products may have different acts of physical attributes. Each product has its own set of attributes which are determined by the management team of the firm producing the product In this model, buyers choose among alternative products, selecting from among those that best fit their needs and desires. If similar products are produced, the market cannibalizes one product for the other. If a product has only a few desirable characteristics, then the marker will largely reject it. The poorer the product, in the eyes of the buyer, the fewer sales. Marketing pressures from price, promotion and sales force efforts, affect demand but do not need to dominate the product attributes. The relative importance among the economic and product attributes can be controlled by the simulation administrator

Implementing Total Quality Management In A Computerized Business Simulation

This paper describes an incomplete process. It deals with the beginnings of the development of a business simulation that includes a quality control feature

Profits: The False Prophet

Historically, the profits generated during the course of play by companies in a business simulation have been used as a surrogate measure for the managerial ability of the team members. The author suggests that this view has severely limited the scope and design of business simulations. Better measures of managerial ability would be gained by measuring and analyzing errors in forecasting over a wide variety of events. The ability to operate within budget constraints and the ability to allocate limited resources among almost limitless needs are also indicators of managerial ability. Assigning specific responsibilities to each individual on a team and then evaluating that individual’s effort, allows a grade or performance rating to be assigned to each member of the team. Measuring profit performance requires the limitation that all firms must start as equals. Without this imposing limitation a much richer simulation environment could be established

The Design of an Internet Game

This paper discusses the design of a total enterprise management simulation or business game called Compromise©. The game works on a network. The business game has four functions: an executive, a comptroller, a marketing and a manufacturing function. In order to successfully compete with other firms in the marketplace, each firm must effectively communicate via electronic messaging between the functions in order to produce a set of decisions. The paper includes the rationale, the parameters the decision sets, individual player evaluations, information feedback to the participants and the assessment of the quality of the decisions themselves

The Development of a Microcomputer Distributed Processing Business Game

Several microcomputer versions of sophisticated business simulations are being redesigned for classroom use~ [1] Most of these are rewritten copies of the mainframe programs. These conversions seem to combine the worst attributes of both types of hardware. They require substantial floppy disk handling, produce large amounts of paper output, and they tend to reproduce the mainframe product without enhancing the learning process. Micros are not fast processors, especially for programs written in interpretative BASIC and their printers are painfully 810w. When one uses a microcomputer to develop a business simulation, care should be taken to enhance the learning process by using those features for which micro’s can be used to the best advantage. Unlike a computer terminal to a mainframe, micros can provide a lot of calculations as a stand alone computer for analysis of decisions and results, If any ancillary analysis is to be done most games require data to be taken from paper output and reentered via the keyboard. When using mainframe simulations students some- times punch the entire set of decisions and the resulting output into an SPSS data base for analysis. When Micro’s became available, students first began by using VisaCalc and later Lotus 1-2- 3 for analysis. Here again, the students were required to reenter the data from paper output

Building Microcomputer Business Simulations

The advent of microcomputers has the capability of enhancing the learning experience attained by the use of business simulations. These games, however, can not be simply downloaded from the mainframe versions. the desk top computer is not a small mainframe. It has unique capabilities. Interactive capabilities must be built into these new simulations and the output needs to be directed to ascii files instead of paper in order to utilize the large number of microcomputer software in general use by the business world. With the use of what if’ scenarios, the micro simulations will allow students to make the connection between the theory as taught in the business schools and the practice as occurs in the business world

Forecasting Accuracy and Learning: A Key to Measuring Business Game Performance

"This paper looks at forecasting errors made by student participants of the CAPSTONE simulation. CAPSTONE is a total enterprise simulation in which participants make individual product decisions as well as firm-wide management decisions. Over the eight rounds of the simulations, the student learned how to more accurately forecast outcomes. Each participant was essentially a “brand manager” for a single product and each student was held responsible for the contribution margin of their product. After the decisions for each round were made, each student was required to forecast the following four items: 1) the unit gross margin of their product; 2) the unit sale of their product; 3) their product’s market share; and 4) their product’s ending inventory levels in terms of the number of units on hand and the number of days of sales the inventory represented at the end of the round. The accuracy of these forecasts was then related to the student product’s contribution to overhead and profit. After the product level forecasts were made, the team acting as a committee of the whole forecast three firm-wide outcomes: 1) the cash–on-hand at the end of the period; 2) the return on sales (ROS) for the period and 3) the earnings per share (EPS) for the period. The study found a strong positive relationship between the product-level forecast accuracy and the product’s contribution margin and the firm-wide forecast accuracies and the firm’s profitability. A rather strange anomaly was found. If a firm went into a chapter 11 Condition (it needed an emergency loan), it became more profitable. Implications of these findings are discussed.

Using Forecasting Accuracy As A Measure Of Success In Business Simulations

This paper describes the results of an experiment that investigated the link between the ability of simulation team participants to forecast the financial and/or market related outcomes and the actual results of their decision making. This experiment was repeated six times over the course of an academic year. Each replication involved 12 consecutive decision periods. The experiment required each member of the student teams to forecast either the expected market share and sales of the product for which they were making decisions or to forecast the cash flows and profits of the simulated firm. The managerial position a student held during the simulation determined the type of forecast (market share, cash flow, etc.) he or she would be assigned. The experiment showed a very strong link between the ability of the management team to forecast outcomes and their firms performance, as measured by profitability

Using Spatial Relationships to Estimate Demand in Business Simulations

This paper presents an additional, approach to modeling and simulation that combines the economic factors with a set of physical, product characteristics factors to determine the allocation of demand to the competing firms. The product characteristics are modeled using a growth flow model,. A market segment is defined which desires an ideal, or best product based on the characteristics of the product. Although all products are purchased, the amount demanded is a function of the difference between each actual product and the ideal, product. This paper then expands the concept from a single market, multi- firm-single product model, to a multiple market segment mode’ in which each firm has the capability to produce several, different products

Meeting Meeting Objectives

This session will allow delegates to participate in a game about how not to go about meeting the objectives of meetings. In other words, the game illustrates and highlights in a vivid way some of the politics of meetings