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Mikes Bikes Intro
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An Introduction to Mikes Bikes Advanced
Presented by:
Peter Janciw
What is a Business Simulation?
• A representation of a real world company
• Governed by real life business conditions trying to achieve goals and strategies
• You are placed the role of Management and must make strategic decisions
• It is NOT just a game, it is a learning experience
Why simulations are used
• Application of theoretical business concepts (everything you learned in IB1!)
• Used in both the academic and business realm
• Simulations build teamwork skills and provide an enjoyable way to learn.
• Manitoba International Marketing Competition
We will now look at…
1. What is Mikes Bikes?
2. Simulation interface elements
3. The importance of strategy
4. The main functional areas of the business
5. Things to watch for
What is Mikes Bikes?
• You are the new manager of a manufacturer in the bicycle industry
• 5 market segments and 3 distribution methods exist
• 2 versions: Single-Player and Multi-Player We will be using the Multi-Player version
• Rollovers are automated!
Multi-Player Structure
• Course
• World
• Firm
• User
Simulation Interface Elements
1. Decision Screens – Enter the values for all functional areas for the next period
2. Reports – View company results and analyze for next decision
3. The Advisor - The Mikes Bikes “helper.” Provides tips and assistance
The Importance of Strategy
• Strategy – How you will achieve your organizational goals
• Each Marketing, Production and Financial decision you make ties into your overall strategy!
• Monitor strategy by constant analysis (via reports) then make the right decisions
Applying The Strategy
• Big Picture > Main Objectives > Low Level
• Meeting Main Organizational Objectives– Making Profit– Having enough Product– Keeping Customers Happy
The Main Functional Areas
1. Marketing – Advertising, Public Relations, Branding, Price, etc
2. Production and Operations – Our capacity to produce
3. Finance – Costs, Cash Flows, Profit
4. R and D – Developing products the consumer wants
5. HR – Size of our workforce, training, etc
1. Marketing
1. Promotion – Advertising, Public Relations
2. Distribution (Place) – Departments Stores, Bikes shops, and Sport Shops
3. Price – How much will we/can we charge our customer?
4. Product – Creating what the consumer wants
2. Production and Operations
• Plant capacity measured in SCU’s (Standard Capacity Units)
• Control batch size, set up time reduction, preventative maintenance
• Forecast sales to determine production values
• Factory efficiency of 70% - 80% is very good
3. Finance
• We want to cover our costs and make a profit!
• We can increase or pay back long term debt
• Shares can be sold to raise capital, or be bought back.
• Provide shareholders with dividends from cash surplus
4. Research and Development
• Modify existing products or create a new one
• Choose product attributes: Design/Style and Technical Specs
• Use the product placement and the perceptual map to determine which attributes our target market wants
5. Human Resources
• We can increase or decrease the size of our workforce
• We need to decide how much to pay our employees
• We need to decide how much we are going to spend on training our employees
Things to watch for…
• Plant capacity – Too much will be a waste of resources. Under capacity will result in not being able to meet our customer demands (opportunity costs).
• Marketing decisions - Be sure to spend the right amount of resources in the proper areas.
Things to watch for…
• Financing decisions - Watch your debt to equity ratio. Too much debt and not enough equity will hurt share price!
• Is the price right? – Having a price that is too low results in lower revenues. Having a price that is too high results in lower sales.
• Don’t stock out!
Simulation Schedule
• 2 practice moves– Fri May 20th, Tues May 24th
• 6 actual moves– Move 1: Fri May 27th
• Presentations to the board– Show how your company has performed over
the past 5 periods
The Group Experience
• Do key tasks AS A TEAM
• Listen to everyone’s ideas and opinions
• Deal with situations as the occur
Downloading and Playing
• Download all software and player manuals from http://www.smartsims.com
• Smartsims e-mail: [email protected]
• 2 team members can register at a cost of $50 each. This amount is spread over the team to lower costs
• Smartsims will e-mail your registration information to you
Downloading and Playing• Firewall configuration
• Access Multi-player software in 3C13– UserID: student-01– Password: NetMike
• Smartsims access:– Login: stuwinnipeg– Password: canada
Walkthrough
• How to make a round of decisions…
Questions
