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WorkingCapitalSimulation

JarrodGoentzel

BasedonmaterialsprovidedbyHarvardBusinessPublishing

Toaccessthesimulation

• ClicktheHarvardBusinessPublishing linkintheemailyouweresentbythecourseadministrator

• Itshouldhavethisdomain:cb.hbsp.harvard.edu• Notethatthelinktoaccessthesimulationmaybedifferentthanthe linktootherHarvardBusinessPublishingmaterials(e.g.cases)

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Youshouldarriveatthispage

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Logintoyouraccount

IfyouhaveapreviousHBPlogin,thenthelinkwilladdthe

simulationtoyourcoursepack.

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RunSimulation

Click “Coursepacks”

Click your course name

Scroll down and click“Run Simulation”

YYYY CourseName

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Available inyourcoursepack online:

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Warmupanalysis:CashConversionCycleforSNC• Calculatethefollowingfor2012

– DSO:DaysSalesOutstanding– DPO:DaysPurchasesOutstanding– DSI:DaysSalesinInventory– CCC:CashConversion Cycle(indays)

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• YousimplymakeYES/NOdecisionsaboutbusinessopportunities• Thereare10opportunitiesover thenext8years

(1024solutionsifyouwanttocompletelyenumeratethem)

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WorkingCapitalSimulation• Roles:YouaretheCEO,Iamtheshareholder• Goal:Makemehappy• Constraint:Yourcreditlinecannotexceed$3.2million; laterImayreducethecreditlineandseehowitaffectsyourperformance.

• Resourcesavailable– Video(6minutes)todescribethegame– Copytoclipboardoption(mayneedtorefreshthebrowser)

– TerminologyPrimer

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Watchyourcreditlimit

Questionstoconsiderforthedebrief

• WhatisthekeytoSNCsuccess?• Whatwasyourobjectiveinmakingdecisions?• Whatapproachesdidyouusetoevaluateoptions?

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