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MNGMNT Game Manual 2010
MNGMNT Game Manual 2010
MNGMNT Game Manual 2010
PLAYERS MANUAL
Final Edition @ 11/24/2009
The Management Game Welcome to the Management Game
Table of Contents
Registration 4
Play within Worlds 8
Play within Universes 9
Factory Design 10
Product Design 11
Market Design 11
Other Start-up Information 12
Things To Think About As You Play 13
Input – Overview 14
Output – Overview 14
MARKETING INPUTS
Prices 21
Contract Description 23
Shipping Preferences 24
Shipping Containers 26
Marketing Budgets 28
Marketing Consultants 29
OPERATIONS INPUTS
Research and Development 31
Production Consultants 32
Existing Operations 33
Factory Relocations 38
2
The Management Game Welcome to the Management Game
FINANCE INPUTS
Debt Transactions 40
Equity Transactions 41
Dividends 42
Receivables Collection Budget 43
Early Payment Incentive 44
Insurance 45
Currency Futures 46
3
The Management Game Welcome to the Management Game
For this class, your company will produce and market wrist watches.
Registration- Keys
As the class begins, it will be necessary for you to register. You will
be given a "Key" and you can use this Key to visit the class website
and register for one of the classes. Your registration Key will be given
to you by your local professor or in some cases, your registration key
may appear above next to the word "Registration-Keys". At any given
time, there may be several classes running. Your Key will permit you
to register only for the correct class, (either MBA or Undergraduate).
For students in Pittsburgh, you will be given your registration key as a
link via email as the class begins and this link will take you
automatically to the class webserver. The direct address to the class
web server is this:
4
The Management Game Welcome to the Management Game
https://managementgame.tepper.cmu.edu
5
The Management Game Welcome to the Management Game
The first time you visit this site and register, you will be mailed a
password which will permit you to enter the site. After you login for
the first time using the password which was assigned to you, you will
be able to select a password which will be something easier to
remember. If you ever forget your password, you can use the retrieve
password feature of the login screen and your password will be sent to
you via e-mail. If your e-mail address changes during the class, you
can update your information using the "Administration" link which
appears just after the login screen.
1. If you change your email address for any reason, you must go to
the webserver and change the address there as an update to your
personal contact information.
2. If you forget your password, you can have it mailed to you in a few
seconds by using the "retrieve password" link on the login screen.
3. You can reset your password anytime you wish to make it easier to
remember, by using the "change password" link on the login screen.
6
The Management Game Welcome to the Management Game
Competitive Design
7
The Management Game Welcome to the Management Game
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8
The Management Game Welcome to the Management Game
Class teams cannot interact across worlds, which means you are not
At the start of the
competing with the teams of your classmates outside your world.
Game, the
economic Each team will publish its high-level performance data on the class
characteristics of all
website, so that the relative performance of each team will be
the worlds are the
same. measured against other teams in the class to some degree. When
this manual refers to your competition, it means only those other
As the Game
continues, companies within your world, not all of your classmates.
competitive
dynamics drive the
outcomes for each
world in different Play within Universes
directions.
Worlds exist within different universes, named Universe 1, 2, 3, etc.
Sidebar text
Universes exist so that the worlds can share the stock market. You
will explore the workings of the stock market as you proceed with the
Game. The figure below shows how worlds within a universe interact.
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9
The Management Game Welcome to the Management Game
Factory Design
When the Management Game begins, each team has two factories
located in different countries. The starting characteristics of each
factory are as follows:
Each factory makes only one product; that is, a factory can
either make Product 1 or Product 2, but not both products.
The Game involves six possible countries in which your
factories are located: Japan, China, Mexico, United Kingdom,
Germany, and the United States.
Factory locations are initially selected for you, but once the
Game starts you can relocate the manufacturing facilities to any
location within your world. Normally, this key strategic decision is not
permitted in the first year of the competition.
Initially, both factories are of approximately equal size; you can
make them larger or smaller after the Game begins.
A factory reflects the available labor and material costs typical
of the country in which it is located.
Both factories can be located in the same country.
Keep in mind that if The quality of watches produced in any factory will differ
you run your depending on the country in which is it located. Some locations will
company correctly, result in higher quality products than others.
you can produce a
quality product For example, German and Japanese factories are usually more
anywhere in the automated and capital-intensive; therefore they have high fixed costs
world. The cost of and costs for building new facilities, but fairly low total labor costs for a
obtaining high very high quality product. Factories in China and Mexico, on the other
quality products is hand, use more, much less expensive labor and cheaper facilities with
what changes from less automation; it can be more difficult and more expensive overall to
location to location. get the same high quality products out of these factories. Research
and development spending will also have different efficiencies in each
country. A dollar spent on research to produce watches in a German
factory will deliver different results compared to the same dollar spent
Sidebar text on research to produce watches in a British factory. The differential
research spending effectiveness of each country changes each year
and will be published separately as the game begins.
10
The Management Game Welcome to the Management Game
Product Design
Your company can make no more than two different products, but
some teams may decide to produce and market only one. Teams will
not be rewarded or penalized for the number of product models they
choose to make.
Market Design
11
The Management Game Welcome to the Management Game
Several years of historical data are available so that you can develop
a feel for consumer preferences, price and quality characteristics, and
Customer
Preferences are other aspects of the economic environment for each market. You will
fixed for the
entire receive both input and output data for your company, so that you can
competition and
are identical in determine what actions your predecessors decided to take and what
all worlds. resulted from their decisions. This historical data is extremely rich in
Therefore as
you gain insight valuable information. You will also receive current information about
into how your
customers the economic conditions for each country at the start of the Game,
trade-off
changes in price such as tariff rates, transportation rates, currency exchange rates, and
against changes
in quality, this
average manufacturing costs. Information about the cost structure of
relationship will manufacturing facilities in various locations as well as the
remain fixed.
effectiveness of research spending will be published separately from
this manual each year. Using this information and your own
management savvy, your team can choose reasonable strategies,
position your products according to customer needs and determine
the feasibility of relocating a factory or factories. Remember, though,
that you can produce a competitive, quality product anywhere in the
world if you manage efficiently. Therefore, while factory location may
constrain your future flexibility, it has less impact on your team’s
12
The Management Game Welcome to the Management Game
What type of decision and/or support tools will your team need
(i.e., tools to manage cash flow or forecast sales, or monitor
competitors)?
What type of organizational structure should your team have?
You need to design ways to coordinate the work of your team
members effectively.
What strategies would you like to implement and what value will
these strategies add to your business? How will you defend your
advantage?
You are all talented managers, capable of great success.
Planning and effective organization will be the key.
Effective teams use all of their assets productively. Remember
that your most valuable assets are the time and talents of your people.
How to Play
Your team is responsible for tracking its progress using different online
tools. The simulation will run periodically using the variables that you
input to produce output data. Your inputs and those of your direct
competitors drive the output data.
13
The Management Game Welcome to the Management Game
Each team must complete a set of input decisions for the company
each period. Each time period represents 3 months of simulation
time. The web based input interface provides a template for making
and entering your decisions
14
The Management Game Welcome to the Management Game
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15
The Management Game Welcome to the Management Game
The first section, Inputs, indicates the name, and description for each
field your team must complete at the beginning of each game cycle.
16
The Management Game Welcome to the Management Game
The Outputs section of this manual explains the different parts of the
pre-formatted output reports, the information these parts contain, and
how that information is calculated. The pre-formatted outputs for your
company will look identical to the ones shown here. Becoming more
familiar with the layout of these reports will allow you to locate
information more easily in the future; use this manual as a reference
as you continue with the Game. Once you and your teammates are
familiar with these output reports, you can create additional
management tools and models to help you analyze your company's
performance.
Good Luck!
17
The Management Game Inputs
Inputs
Marketing
Decisions
18
The Management Game Inputs
19
Finance
Decisions
The Management Game Inputs
1. Prices
2. Shipping
3. Marketing
4. Operations
5. Finance
This section provides information on the input fields you will have
control over as you attempt to operate your company. The data
appears in the following format:
Description
A brief description of the field appears here.
Example
A sample entry for the field appears here.
20
The Management Game Inputs
Product Prices
Important!
Do not leave any price field blank. If you leave this field blank for
currency accepted as any country, the system will use the prices from the previous year.
the national currency
of a certain country. If you don’t want to sell your product(s) in a certain market, enter a
price of 0. Do not enter a very high price, as this will damage your
Local currencies for
company image.
this Game are shown
here. Note that prices are in local currency:
21
The Management Game Inputs
Contract Prices
Description
In addition to the six retail markets, there is also an institutional United
States government market. Only product 1 can be sold within this
government auction market. This market is divided into two types of
contract auction opportunities to sell product 1. The two auction
opportunities have different rules. One auction is conducted each
time period within each world for a fixed volume of units that are pre-
announced one period in advance. This auction is part of the
decisions which you make each time period and the auction itself is
conducted within the simulation. The second auction opportunity to
sell product 1 to the US government is conducted through the class
web site in-between simulation cycles. The rules for this "on-line
auction" do not appear in this manual. They appear only on the class
web site. Below, we describe the contract auction which is embedded
within the simulation.
Contract Volume In this field, you bid for a United States government contract to supply
refers to the number a fixed number of units of your Product 1. Only contracts for
of units fixed in the Product 1 are available.
contract.
To give you an idea of how many Product 1 units are required, the
contract volumes will be announced one period before bidding. If you
are the low bidder on a contract, then you “win” the contract and the
product is sold, shipped and paid for during that period at your
Your company’s winning bid price.
contract image is the
dollar per unit Winning the contract bid often enough allows you to develop a
advantage that your significant advantage in future bidding. This advantage is visible to
team has
you as your contract image in the Next Period Data section of your
accumulated by
successfully bidding Finance Report (see the Outputs section for more information). Keep
for past contracts in mind that contract image rarely exceeds 10% to 15% of the contract
unit selling price. Each time that you win a contract, your contract
image will grow but it will level off at approximately 4-5 dollars per unit
22
The Management Game Inputs
Your effective bid, when determining who wins the contract, equals
your actual bid minus your contract image.
Example
Assume that you bid $40 and your contract image is $3; your effective
bid is $37. If $37 is the lowest bid, then you win the contract and will
receive $40 as the selling price equal to your bid.
What Happens if Nobody bids for the contract? The winner of the
contract will be team "0" implying that nobody bid so nobody won.
Any non-zero contract images will fall by 1.0 but will not fall below
zero.
What Happens if there is a perfect tie for the contract? The contact
will be replicated and awarded to each team which ties. Each winner
will receive and fill the entire contract. The winner of the contract will
appear in the output as "multi". The contract image of each winning
team will increase.
companies within your world can contracts can be bid and won by
bid. any team in the class and one
team can win multiple contracts.
Lowest price -advantage wins and Lowest price with sufficient quality
quality does not matter. wins. If your product quality is too
low, you will be blocked from
bidding on some contracts which
require higher quality products
24
Important!
The entire amount (100%) of the demand for each country will be
Inputs
fulfilled in the order that you requested until the product is exhausted.
All contract units are shipped free of all transportation costs, all tariffs,
and do not require any containers.
Example
The sample below shows Shipping Preference Order field entries for
one company.
In this example, the company selected the United States as the 1st
priority market for Product, followed by the Japan, Germany, the
United Kingdom etc. There are 5 input fields and 6 countries so
whichever number does not appear is automatically specified lowest
priority. Remember, if there is no stockout, then the shipping order
preferences will impact only how the costs of different inventory layers
are allocated to different markets. However, if demand exceeds
supply and your company does experience a stockout, the location of
25
The Management Game Inputs
26
The Management Game Inputs
Containers
Description
Your company’s
transport capacity Your company needs containers to deliver its products. This field
appears in the indicates how MANY DOLLARS your company wishes to allocate to
Production Report of purchase or rent containers to deliver your product(s). These
your output file.
containers are available immediately following your purchase request
and can be used in the period that they are purchased.
You can only buy or rent containers; you cannot sell them. Each
container costs $3,000.00 to buy and is capable of transporting 1,000
units per period used. Rental costs are $2,000.00 per period.
27
The Management Game Inputs
Note: If your demand for product exceeds your ability to ship them,
Important! your company will automatically rent additional containers for special
emergency rates. These rates are $3,000 per container for one period
rental, which is very high; so underestimating the need for containers
can be expensive.
Example
Assume that your sales forecast indicates that your are likely to sell
250,000 units of product 1, 200,000 units of product 2, and 50,000
units of product 1 into the government contract market. Also assume
that you currently own 400 containers. Therefore, if your sales
forecast is good, you will need 50 more containers. If you decide to
purchase them, you would enter "150" into the input field for
purchases and if you decide to rent them, you would enter "100" into
the input field for rentals. You could also rent some containers and
buy some containers at the same time, if you choose.
28
The Management Game Inputs
Marketing Budgets
(also called Marketing Expenses)
Description
You indicate your allocated marketing budget for each product in
this field. The effects of your marketing programs change over time
in response to your competitors’ actions. Products are marketed in
every country, unless you set a price of 0 (see Product Prices
section above).
29
The Management Game Inputs
Example
For instance, if you enter “600” for Product 1 in Mexico you are
really allocating 600,000 pesos. This will impact the sales of
product 1 in Mexico in the current period and in the future. This will
not impact at all the demand for product 2 in Mexico and this
spending will not impact at all the demand for product 1 in other
countries.
Marketing
consultants improve
marketing
effectiveness. Their
effect is multi-period
similar to
organizational
learning Description
You may hire consultants each period to help improve the
effectiveness of your marketing programs. Payments to
consultants are in US dollars.
31
The Management Game Inputs
Operations Inputs
Research & Development (R&D)
Steady research
spending is more
effective than volatile
spending of the same
magnitude.
The manufacturing
cost of your product
Description
increases as your
quality increases You set your company’s R&D budget in this field. You will have a
relative to your
separate R&D budget for each product.
competitors. This
increase is a small R&D budgets influence the attractiveness of your product to your
one to reflect the
customers as measured by the Relative Quality Index (see the
higher quality of
components in the Outputs section)
watch. Effects of R&D expenditures are cumulative and long lasting, but
often with significant lag times.
Example
The impact of your company’s spending for R&D in Period T is fully
reflected in your Relative Quality Index at the end of Period T.
Products sold during Period T are perceived by your customers to
have the quality indicated at the end of Period T – 1.
32
The Management Game Inputs
For instance, assume that your Period 4 output for Product 1 shows
a quality index of 0.90. When you make your decisions for Period
5, you increase your R&D spending, and we will assume that this
higher spending level results in a relative quality increase to a level
of 1.0. Therefore, this higher spending results in an increase in
relative quality index which appears in your Period 5 output.
33
The Management Game Inputs
Description
Your company has the ability to hire consultants to improve the
efficiency of your manufacturing operations. These consultants are
directable and their effort must be allocated to the 2 products which
you manufacture. The impact of these consultants is primarily on
the variable manufacturing costs. They can not affect factory
capacity and they normally do not impact fixed costs in a significant
way. Sharp decreases in production consulting spending can
cause variable manufacturing costs to increase. Consultants
impact costs in a cumulative, multi-period way. Consulting
expenses diminish in effectiveness at higher levels. The impact of
additional consulting spending is never zero or negative, but
diminishes rapidly above $300,000/Quarter
Operate existing
factories
Expand existing
factories
Downsize existing
Factories
Close Existing
Factories
34
The Management Game Inputs
Description
The first two fields define your production budget; that is, the
money allocated to your two factories to manufacture your product
in the current time period. Your funds automatically go to defray
material and labor costs as needed.
Example
If you decide that you want to operate your company at less than
full capacity, you can accomplish this by reducing the amount of
money available for production.
Of course, the lowest possible amount you can enter here would
equal your fixed costs. In this case, your factory would produce a
very small number of product units at a very high cost per unit.
35
The Management Game Inputs
Your total cost per unit while operating at 80% capacity would then
be $25.00, as compared to $24.00 if you were operating at full
capacity.
You can see that as you lower your factory utilization below 100%,
your unit costs rise.
If unit costs rise as operation capacity drops, why would you ever
want to operate below full capacity?
36
The Management Game Inputs
Example
Construction costs per unit of capacity (in US dollars):
Japan = $25 Mexico = $17 China = $16
United States = $20 United Kingdom = $22 Germany = $24
Presume that you have a 225,000 unit factory in Germany and you
find that you can sell more than this amount. You wish to expand
to 250,000 units of production capacity.
These funds are available immediately.
Important!
The amount you enter in this field is thousands of units of capacity
—not dollars. Plant capacity takes multiple periods to rebuild. A
mistake in this field can be devastating.
For example, if you enter 50 in this field, then 50,000 units of your
factory’s capacity will be sold for 75% of its net book value. You
will receive this amount in cash. You will also see an expense
equal to 25% of the net book value of the sold capacity in the Plant
Sale Loss section of your Finance Report (see the Outputs section
for more details).
37
The Management Game Inputs
Be Careful! If you enter 200 or 300 in this field, thinking that you are liquidating
a few hundred thousand dollars of capacity, you will soon discover
that you liquidated most of your plant capacity.
Factory Closure
You have the ability to completely close a factory. This decision is
entered in the fields directly below factory decreases. If you
choose to completely close a factory, it is not also necessary to
also indicate a factory capacity decrease. Closing a factory is
equivalent to completely selling all capacity. If you choose to close
a factory, it will be closed immediately at the start of the period in
which you make this choice. Do not allocate money to operate a
closing factory. You can continue selling inventory for multiple
periods without a factory but once the inventory is gone, your
warehouse will disappear.
After your factory is closed and your inventory is gone, you must
set zero prices for the markets in which you are not participating. If
you later decide to re-open your factory it is necessary to build a
new one using the factory relocation input fields described below.
38
The Management Game Inputs
Factory Relocation
Status of factory
location. After you
have submitted and
approved your
decisions, your factory
location and status will
be displayed here.
Make sure you agree
with the actions about
to take place.
Description
Companies have the ability to move their factories. To relocate
Important! your factory to another country, you must enter the target
destination country of the new factory and the number of units of
product that factory will produce at full capacity. If you do not
Pay careful attention wish to relocate your factory, enter 0 in these fields. Do not
to this factory status leave any fields blank.
information. This
will tell you the A new factory can be no more than 15% larger than the old factory;
outcome of your
decisions on your the new factory can be any amount smaller than the old factory.
factory status. The You can also move both of your factories simultaneously.
timing of when
factories close and To permit the construction of your new factory, relocation takes one
relocate is important
to your planning period to complete. However, you can (and should) continue
production at the old factory until the new one is completed so that
there is no interruption in supply of product to sell.
39
The Management Game Inputs
A full description To document when construction on the new facility begins, both
of the Production you and your competitors will see a notice in the production report
Report appears in of your output file (see Outputs section).
the Outputs
section of this The old and new factories will yield products at the same quality
document. level. Any history of consulting spending will move from the old
factory to the new factory
Cost structure You will not know the exact cost structure of the new factory until
refers to your fixed
it is completed. Because you will not have operating information for
and variable
manufacturing the new factory, you should make a conservatively high estimate of
costs. the cost structure to set your production budget for the new factory
when it is first completed. After the factory has been in operation
for one period, you will be able to analyze the new cost structure.
Example
For instance, if you indicate that you want to move your factory
from China to Mexico during period T, you can continue production
at the China location until period T +1, when the facility in Mexico is
completed.
If you make the request for relocation in period T, you will have to
set your production budget for the new facility in period T + 1,
without any prior data about the cost structure associated with the
new location.
40
The Management Game Inputs
Debt Transactions
Each company has a limited line of credit that allows it to borrow
money for operations costs, as needed. Companies can make
payments or increase borrowing as desired. Think of this as a
revolving line of credit. The simulation does not make loan
payments automatically; you must designate money for this
purpose. If you take no action, your loan balance increases each
time period by an amount equal to the interest expense. You can
only borrow money in US dollars.
Credit limits appear at the bottom of the Finance Report output for
each period (see the Outputs section for more information).
Interest rates appear in this same location. Initially, all teams pay
the same interest rates, but as play continues the rates may
fluctuate. The interest rate that you pay depends on your recent
past profitability. If you are losing money, your debt will carry a risk
premium up to 100% above the rates available to the best
companies.
41
The Management Game Inputs
Your credit line and loan repayment costs are in US dollars. Your
In this case, debt is capped at 200% of the book value of your equity. However,
equity refers to
it will become risky and expensive at lower levels so it is unlikely it
the common
stock plus is a good idea to operate with debt levels at or near the upper limit.
retained
earnings as Stock Transactions (Buy or Sell)
they appear in
your balance
sheet
VERY Description
IMPORTANT
Since stock You can raise needed cash by issuing new stock in your company.
transactions will
likely impact stock You can also return unneeded cash to owners by buying shares of
prices, these your own company. In these fields, you choose the dollar amount of
transactions must be the transaction. The shares will be bought or sold at the most
pre-announced to
the stock market. recent stock market closing price. SEE THE NOTE REGARDING
There is a CFO area STOCK MARKET REQUIRED ANNOUNCEMENTS TO THE LEFT.
within the stock
market provided Stock transactions cost 1% of the amount purchased or sold and
where the CFO of
each team is appear as miscellaneous fees in your Detailed Income Statement
required to pre- on your Finance Report (see Outputs section for more information).
announce any stock
transactions one Companies cannot buy or sell securities of other companies.
trading day in
advance of the
transaction. If the Example
announcement is not
made, then the Presume that your company wishes to purchase 1 million dollars of
transaction can not stock in the next simulation cycle which is scheduled for
be completed.
Wednesday morning. The CFO of the company, (or any member of
the team designated by the president to have authority to make
such announcements), is required to post an announcement within
the stock market prior to 2PM on Tuesday. In addition to the
announcement, the transaction must be entered as an input
decision. The stock price used for the transaction will be the
closing price Tuesday.
42
The Management Game Inputs
43
The Management Game Inputs
Collections Budget
Description
Your company's bad
debt expense can be By allocating money to collect receivables, you can accelerate the
negative if you are rate at which your company collects these receivables and you can
successful collecting
receivables which also influence your company’s bad debt expense rate.
were previously Overly aggressive collection tactics often drive customers away,
written off as a bad
which causes your sales to suffer. Be cautious in allocating your
debt.
collections budget.
Example
If your company spends nothing on collections in time period T, that
is, you make no entry in this field, the simulation will automatically
44
The Management Game Inputs
apply a baseline bad debt rate of 0.7% of the retail sales from time
period T – 2.
Important!
You can drive this rate below 0.7% by your collections budget
choices.
See the section in the finance report which describes the timing of
cash flows.
45
The Management Game Inputs
Insurance
There are 3
types of
insurance that
you can buy
Description
As indicated, your company can buy three types of insurance.
46
The Management Game Inputs
47
The Management Game Inputs
When you sell products, you are paid in local currency, not in US
dollars. If one or both of your factories are located outside of the
US, they will consume local, non-dollar currency.
Example
For instance, if you enter 25 in the field labeled "Buy Currency Forward
Contract, Yen", you are agreeing to purchase 25 million yen at the
current forward rate of exchange. The contract is then settled at
the end of the time period.
Period T
Spot Rate = 120 yen
Forward Rate = 110 yen
48
The Management Game Inputs
B. You lose money because the yen is worth less than expected.
C. You gain money because the yen is worth more than expected.
B. You gain money because the yen is worth less than expected.
C. You lose money because the yen is worth more than expected.
49
The Management Game Outputs
Outputs
Each report is derived from raw data. When you open the file, be
Important!
sure to read the first page, called READ ME, very carefully.
This page explains how to manipulate information in the file.
50
The Management Game Outputs
51
The Management Game Outputs—Market Report
Market Report
The Market Report contains three main sections that provide specific
information about your company’s performance during a single
period:
52
The Management Game Outputs—Market Report
P r o d u c t 1 M a r k e t S t a t is t ic s World
Jap an % W ld M e x ic o % W ld C h in a % W ld U . K . % W ld G e r m a n y% W ld U . S . % Wld Totals
T o ta l D e m a n d ( U n it s ) 2 3 5 ,4 1 8 1 9 % 1 4 4 ,5 1 5 1 2 % 1 0 5 ,7 4 1 9 % 1 4 8 ,2 8 5 1 2 % 1 9 6 ,9 8 0 1 6 % 3 8 8 , 1 6 8 32% 1,219,107
1 T o ta l S a le s (U n its ) 2 3 5 ,4 1 8 1 9 % 1 4 4 ,5 1 5 1 2 % 1 0 5 ,7 4 1 9 % 1 4 8 ,2 8 5 1 2 % 1 9 6 ,9 8 0 1 6 % 3 8 8 , 1 6 8 32% 1,219,107
T o t a l M a r k e tin g E x p P 91 1 ,9 9 9 ,9 7 81 0 % 3 ,4 4 9 ,9 9 7 6 % 4 ,6 0 0 ,0 1 8 8 % 6 0 0 ,0 0 0 1 3 % 1 , 6 9 9 ,9 9 82 8 % 2 ,3 0 0 ,0 0 0 35% 6,628,896
M kt sh M kt sh M kt sh M kt sh M kt sh Mkt sh
C o m p a n y D e m a n d (U n its ) 4 6 ,7 9 7 2 0 % 2 9 ,0 7 3 2 0 % 2 2 ,8 9 4 2 2 % 2 5 ,7 9 6 1 7 % 3 0 ,0 4 1 1 5 % 4 9 ,5 0 8 13% 204,109
C o m p a n y S a le s ( U n its ) 4 6 ,7 9 7 2 0 % 2 9 ,0 7 3 2 0 % 2 2 ,8 9 4 2 2 % 2 5 ,7 9 6 1 7 % 3 0 ,0 4 1 1 5 % 4 9 ,5 0 8 13% 204,109
2 A d d itio n a l S a le s ( U n it s ) 0 0% 0 0% 0 0% 0 0% 0 0% 0 0% 0
Marketing C o m p a n y M a rk e tin g E x2p1 ,9 9 9 ,9 8 62 4 % 7 4 9 ,9 9 8 2 2 % 1 ,0 0 0 ,0 0 42 2 % 1 2 0 ,0 0 0 2 0 % 3 0 0 ,0 0 0 1 8 % 3 0 0 , 0 0 0 13%
Statistics % S ls % S ls % S ls % S ls % S ls % Sls
C o m p a n y S a le s ( c u r re n2c1y 5) ,2 6 6 ,2 0 02 0 % 9 ,4 4 8 ,7 2 5 1 2 % 9 ,3 8 6 ,5 4 01 3 % 7 5 4 ,5 3 3 1 3 % 1 , 2 0 1 ,6 4 01 6 % 2 ,0 7 9 ,3 3 6 25% 8,174,333
Section. Divided D e liv e r e d M fg C o s1t 3 4 ,0 0 0 ,0 6 86 2 % 6 ,1 1 3 ,1 1 2 6 5 % 4 ,3 5 4 ,0 5 54 6 % 3 8 9 ,2 5 0 5 2 % 5 9 1 , 2 6 7 4 9 % 1 ,0 8 2 ,6 8 6 52% 4,443,331
into 3 areas 3
G r o s s M a r g in 8 1 ,2 6 6 ,1 3 23 8 %
C o m p a n y M a rk e tin g E x2p1 ,9 9 9 ,9 8 61 0 %
3 ,3 3 5 ,6 1 3 3 5 %
7 4 9 ,9 9 8 8 %
5 ,0 3 2 ,4 8 55 4 %
1 ,0 0 0 ,0 0 41 1 %
3 6 5 ,2 8 3 4 8 %
1 2 0 ,0 0 0 1 6 %
6 1 0 ,3 7 3 5 1 %
3 0 0 ,0 0 0 2 5 %
9 9 6 , 6 5 0 48%
3 0 0 , 0 0 0 14%
3,731,002
1,163,572
I m p o rt T a rif fs 2 5 ,8 3 1 ,9 4 41 2 % 5 6 6 ,9 2 4 6 % 0 0% 7 5 ,4 5 3 1 0 % 1 2 0 ,1 6 4 1 0 % 1 0 3 , 9 6 7 5% 599,922
1.World data C o n t rib u tio n M a rg in3 3 ,4 3 4 ,2 0 21 6 % 2 ,0 1 8 ,6 9 1 2 1 % 4 ,0 3 2 ,4 8 14 3 % 1 6 9 ,8 3 0 2 3 % 1 9 0 ,2 0 9 1 6 % 5 9 2 , 6 8 4 29% 1,967,508
2.Company Data P r o d u c t 2 M a r k e t S t a t is t ic s World
3. Profitability by Jap an % W ld M e x ic o % W ld C h in a % W ld U . K . % W ld G e r m a n y% W ld U .S . % Wld Totals
country market T o ta l D e m a n d ( U n it s ) 1 9 5 ,9 5 3 1 8 % 1 1 8 ,3 2 2 1 1 % 9 0 ,4 8 1 8 % 1 4 9 ,3 7 1 1 4 % 1 8 7 ,3 6 0 1 8 % 3 2 4 , 9 1 9 30% 1,066,406
information T o ta l S a le s (U n its ) 1 9 5 ,9 5 3 1 8 % 1 1 8 ,3 2 2 1 1 % 9 0 ,4 8 1 8 % 1 4 9 ,3 7 1 1 4 % 1 8 7 ,3 6 0 1 8 % 3 2 4 , 9 1 9 30% 1,066,406
T o t a l M a r k e tin g E x p P 72 0 ,0 0 0 ,1 2 6 7 % 3 ,3 9 9 ,9 9 9 5 % 3 ,7 0 0 ,0 1 5 5 % 1 ,2 9 6 ,9 9 9 2 4 % 1 , 9 7 5 ,0 0 12 8 % 2 ,5 0 0 ,0 0 0 32% 7,873,977
M kt sh M kt sh M kt sh M kt sh M kt sh Mkt sh
C o m p a n y D e m a n d (U n its ) 3 9 ,2 6 9 2 0 % 2 5 ,8 2 2 2 2 % 2 0 ,4 2 0 2 3 % 3 3 ,9 6 0 2 3 % 3 5 ,6 8 6 1 9 % 6 8 ,8 2 6 21% 223,983
C o m p a n y S a le s ( U n its ) 3 9 ,2 6 9 2 0 % 2 5 ,8 2 2 2 2 % 2 0 ,4 2 0 2 3 % 3 3 ,9 6 0 2 3 % 3 5 ,6 8 6 1 9 % 6 8 ,8 2 6 21% 223,983
E x c e s s D e m a n d (U n its ) 0 0% 0 0% 0 0% 0 0% 0 0% 0 0% 0
C o m p a n y M a rk e tin g E x1p0 ,0 0 0 ,0 1 81 4 % 6 0 0 ,0 0 2 1 8 % 7 0 0 ,0 0 3 1 9 % 2 9 9 ,0 0 0 2 3 % 3 2 5 ,0 0 0 1 6 % 5 0 0 , 0 0 0 20%
% S ls % S ls % S ls % S ls % S ls % Sls
C o m p a n y S a le s ( c u r re n2c7y 0) ,9 5 6 ,1 0 01 8 % 1 1 ,6 1 9 ,9 0 01 1 % 1 0 ,2 1 0 ,0 0 01 0 % 1 ,1 2 0 ,6 8 0 1 5 % 1 , 6 4 1 ,5 5 61 6 % 3 ,3 0 3 ,6 4 8 30% 11,157,184
D e liv e r e d M fg C o s1t 7 1 ,7 5 2 ,7 0 96 3 % 7 ,8 6 1 ,8 9 9 6 8 % 5 ,8 8 6 ,4 7 75 8 % 7 4 7 ,2 5 7 6 7 % 1 , 0 2 4 ,2 2 16 2 % 2 ,2 1 2 ,0 6 1 67% 7,212,577
G r o s s M a r g in 9 9 ,2 0 3 ,3 9 13 7 % 3 ,7 5 8 ,0 0 1 3 2 % 4 ,3 2 3 ,5 2 34 2 % 3 7 3 ,4 2 3 3 3 % 6 1 7 ,3 3 5 3 8 % 1 ,0 9 1 ,5 8 7 33% 3,944,607
M a r k e tin g E x p e n s e s1 0 ,0 0 0 ,0 1 8 4 % 6 0 0 ,0 0 2 5 % 7 0 0 ,0 0 3 7 % 2 9 9 ,0 0 0 2 7 % 3 2 5 ,0 0 0 2 0 % 5 0 0 , 0 0 0 15% 1,511,553
I m p o rt T a rif fs 3 2 ,5 1 4 ,7 3 21 2 % 6 9 7 ,1 9 4 6 % 8 1 6 ,8 0 0 8 % 0 0% 0 0% 1 6 5 , 1 8 2 5% 573,775
C o n t rib u tio n M a rg in5 6 ,6 8 8 ,6 4 12 1 % 2 ,4 6 0 ,8 0 5 2 1 % 2 ,8 0 6 ,7 2 02 7 % 7 4 ,4 2 3 7 % 2 9 2 ,3 3 5 1 8 % 4 2 6 , 4 0 4 13% 1,859,280
P r o d u c t 1 P r ic e s RELATIVE
Jap an r e l p rc M e x ic o r e l p rc C h in a re l p rc U .K . re l p r c G e r m a n y re l p rc U .S . rel prc QUALITY
C o m p a n y 1 4 ,6 0 0 .0 0 98% 3 2 5 .0 0 98% 4 1 0 .0 0 97% 3 2 .0 0 109% 3 7 .0 0 9 6 % 3 6 .0 0 93% 90.1%
C o m p a n y 2 4 ,8 0 0 .0 0 103% 3 4 0 .0 0 102% 4 4 0 .0 0 104% 3 1 .0 0 105% 3 9 .0 0 1 0 2 % 4 0 .0 0 103% 115.2%
C o m p a n y 3 4 ,6 0 0 .0 0 98% 3 2 5 .0 0 98% 4 1 0 .0 0 97% 2 9 .2 5 99% 4 0 .0 0 1 0 4 % 4 2 .0 0 108% 90.6%
C o m p a n y 4 4 ,8 0 0 .0 0 103% 3 5 0 .0 0 105% 4 4 0 .0 0 104% 2 8 .0 0 95% 4 0 .0 0 1 0 4 % 4 0 .0 0 103% 115.5%
C o m p a n y 5 4 ,6 0 0 .0 0 98% 3 2 5 .0 0 98% 4 1 0 .0 0 97% 2 7 .0 0 92% 3 6 .0 0 9 4 % 3 6 .0 0 93% 88.6%
Pricing and A v e r a g e P ric e 4 ,6 8 0 .0 0 3 3 3 .0 0 4 2 2 .0 0 2 9 .4 5 3 8 .4 0 3 8 .8 0
Quality P r o d u c t 2 P r ic e s RELATIVE
Information Jap an
C o m p a n y 1 6 , 9 0 0 .0 0
r e l p rc
101%
M e x ic o
4 5 0 .0 0
r e l p rc
98%
C h in a
5 0 0 .0 0
re l p rc
100%
U .K .
3 3 .0 0
re l p r c G e r m a n y re l p rc
97% 4 6 .0 0 1 0 2 %
U .S .
4 8 .0 0
rel prc
98%
QUALITY
116.2%
C o m p a n y 2 6 , 3 0 0 .0 0 92% 4 2 5 .0 0 93% 4 6 7 .5 0 94% 3 2 .0 0 94% 4 4 .0 0 97% 4 8 .0 0 98% 79.5%
C o m p a n y 3 6 , 9 0 0 .0 0 101% 4 5 0 .0 0 98% 5 0 0 .0 0 100% 3 3 .0 0 97% 4 6 .0 0 1 0 2 % 4 8 .0 0 98% 116.6%
C o m p a n y 4 7 , 1 0 0 .0 0 104% 5 1 5 .0 0 112% 5 2 5 .0 0 105% 3 9 .0 0 1 1 5 % 4 4 .0 0 97% 5 3 .0 0 108% 93.0%
C o m p a n y 5 6 , 9 0 0 .0 0 101% 4 5 0 .0 0 98% 5 0 0 .0 0 100% 3 3 .0 0 97% 4 6 .0 0 1 0 2 % 4 8 .0 0 98% 94.7%
A v e r a g e p r ic e6 , 8 2 0 .0 0 4 5 8 .0 0 4 9 8 .5 0 3 4 .0 0 4 5 .2 0 4 9 .0 0
Information C o n t r a c t M a r k e t in f o r m a t io n
P r ic e t o b e a t
about activity in C o n tr a c t W ith z e o Y o u r c o n tr a c t Y o u r C o n tr a c t Y o u r C o n tr a c t C o n tra c t
the contract
market
53
123
The Management Game Outputs—Market Report
The first subsection, (see arrow below), indicates the total product
demand, total sales, and total marketing expenses for each country
in both units and percentages. Notice, in this example, the total
demand equals the total sales. This means that for this period there
were no product shortages and no “stock out” situations. Total sales
that are less than total demand would indicate that a product
shortage had occurred.
P r o d u c t 1 M a r k e t S t a t is ti c s W o rld
Japan % W ld M e x ic o % W ld C h in a % W ld U . K . % W ld G e r m a n y% W ld U . S . % W ld T o ta ls
T o t a l D e m a n d ( U n it s ) 2 3 5 , 4 1 8 1 9 % 1 4 4 ,5 1 5 1 2 % 1 0 5 ,7 4 1 9 % 1 4 8 ,2 8 5 1 2 % 1 9 6 ,9 8 0 1 6 % 3 8 8 ,1 6 8 32% 1 ,2 1 9 ,1 0 7
T o ta l S a le s ( U n its ) 2 3 5 , 4 1 8 1 9 % 1 4 4 ,5 1 5 1 2 % 1 0 5 ,7 4 1 9 % 1 4 8 ,2 8 5 1 2 % 1 9 6 ,9 8 0 1 6 % 3 8 8 ,1 6 8 32% 1 ,2 1 9 ,1 0 7
T o ta l M a r k e tin g E x p P911 , 9 9 9 , 9 7 81 0 % 3 ,4 4 9 , 9 9 7 6 % 4 ,6 0 0 , 0 1 8 8 % 6 0 0 , 0 0 0 1 3 % 1 , 6 9 9 , 9 9 82 8 % 2 , 3 0 0 , 0 0 0 3 5 % 6 ,6 2 8 ,8 9 6
M kt sh M kt sh M kt sh M kt sh M kt sh M kt sh
C o m p a n y D e m a n d ( U n it s ) 4 6 ,7 9 7 2 0 % 2 9 ,0 7 3 2 0 % 2 2 ,8 9 4 2 2 % 2 5 ,7 9 6 1 7 % 3 0 ,0 4 1 1 5 % 4 9 ,5 0 8 13% 2 0 4 ,1 0 9
C o m p a n y S a le s ( U n it s ) 4 6 ,7 9 7 2 0 % 2 9 ,0 7 3 2 0 % 2 2 ,8 9 4 2 2 % 2 5 ,7 9 6 1 7 % 3 0 ,0 4 1 1 5 % 4 9 ,5 0 8 13% 2 0 4 ,1 0 9
A d d itio n a l S a le s ( U n it s ) 0 0% 0 0% 0 0% 0 0% 0 0% 0 0% 0
C o m p a n y M a r k e tin g E x2 p1 , 9 9 9 , 9 8 62 4 % 7 4 9 ,9 9 8 2 2 % 1 ,0 0 0 , 0 0 42 2 % 1 2 0 ,0 0 0 2 0 % 3 0 0 ,0 0 0 1 8 % 3 0 0 ,0 0 0 13%
% S ls % S ls % S ls % S ls % S ls % S ls
C o m p a n y S a le s ( c u r r e n2c1y5) , 2 6 6 ,2 0 02 0 % 9 ,4 4 8 , 7 2 5 1 2 % 9 ,3 8 6 , 5 4 01 3 % 7 5 4 , 5 3 3 1 3 % 1 , 2 0 1 , 6 4 01 6 % 2 , 0 7 9 , 3 3 6 2 5 % 8 ,1 7 4 ,3 3 3
D e liv e re d M f g C o s1t 3 4 , 0 0 0 ,0 6 86 2 % 6 ,1 1 3 , 1 1 2 6 5 % 4 ,3 5 4 , 0 5 54 6 % 3 8 9 ,2 5 0 5 2 % 5 9 1 , 2 6 7 4 9 % 1 , 0 8 2 , 6 8 65 2 % 4 ,4 4 3 ,3 3 1
G ro s s M a r g in 8 1 , 2 6 6 , 1 3 23 8 % 3 ,3 3 5 , 6 1 3 3 5 % 5 ,0 3 2 , 4 8 55 4 % 3 6 5 ,2 8 3 4 8 % 6 1 0 ,3 7 3 5 1 % 9 9 6 ,6 5 0 48% 3 ,7 3 1 ,0 0 2
C o m p a n y M a r k e tin g E x2 p1 , 9 9 9 , 9 8 61 0 % 7 4 9 ,9 9 8 8 % 1 ,0 0 0 , 0 0 41 1 % 1 2 0 ,0 0 0 1 6 % 3 0 0 ,0 0 0 2 5 % 3 0 0 ,0 0 0 14% 1 ,1 6 3 ,5 7 2
I m p o r t T a r if fs 2 5 , 8 3 1 , 9 4 41 2 % 5 6 6 ,9 2 4 6 % 0 0% 7 5 ,4 5 3 1 0 % 1 2 0 ,1 6 4 1 0 % 1 0 3 ,9 6 7 5% 5 9 9 ,9 2 2
C o n t r ib u t io n M a r g in3 3 , 4 3 4 , 2 0 21 6 % 2 ,0 1 8 , 6 9 1 2 1 % 4 ,0 3 2 , 4 8 14 3 % 1 6 9 ,8 3 0 2 3 % 1 9 0 ,2 0 9 1 6 % 5 9 2 ,6 8 4 29% 1 ,9 6 7 ,5 0 8
54
The Management Game Outputs—Market Report
Once you know the world market totals, you can determine how well
your company did in each market by examining the remaining
subsections directly underneath the world market statistics. First,
consider the company demand statistics, (see arrow below), which
indicates your company’s sales performance in each country.
P r o d u c t 1 M a r k e t S t a t is t ic s W o rld
Japan % W ld M e x ic o % W ld C h in a % W ld U .K . % W ld G e r m a n y% W ld U .S . % W ld T o ta ls
T o ta l D e m a n d ( U n its ) 2 3 5 ,4 1 8 1 9 % 1 4 4 ,5 1 5 1 2 % 1 0 5 ,7 4 1 9 % 1 4 8 ,2 8 5 1 2 % 1 9 6 ,9 8 0 1 6 % 3 8 8 ,1 6 8 3 2 % 1 ,2 1 9 ,1 0 7
T o t a l S a le s (U n its ) 2 3 5 ,4 1 8 1 9 % 1 4 4 ,5 1 5 1 2 % 1 0 5 ,7 4 1 9 % 1 4 8 ,2 8 5 1 2 % 1 9 6 ,9 8 0 1 6 % 3 8 8 ,1 6 8 3 2 % 1 ,2 1 9 ,1 0 7
T o t a l M a r k e tin g E x p P9 11 , 9 9 9 ,9 7 81 0 % 3 , 4 4 9 ,9 9 7 6 % 4 ,6 0 0 ,0 1 8 8 % 6 0 0 , 0 0 0 1 3 % 1 , 6 9 9 , 9 9 82 8 % 2 ,3 0 0 ,0 0 0 3 5 % 6 ,6 2 8 ,8 9 6
M kt sh M kt sh M kt sh M kt sh M kt sh M kt sh
C o m p a n y D e m a n d ( U n its )4 6 ,7 9 7 2 0 % 2 9 ,0 7 3 2 0 % 2 2 ,8 9 4 2 2 % 2 5 ,7 9 6 1 7 % 3 0 ,0 4 1 1 5 % 4 9 ,5 0 8 1 3 % 2 0 4 ,1 0 9
C o m p a n y S a le s ( U n its ) 4 6 ,7 9 7 2 0 % 2 9 ,0 7 3 2 0 % 2 2 ,8 9 4 2 2 % 2 5 ,7 9 6 1 7 % 3 0 ,0 4 1 1 5 % 4 9 ,5 0 8 1 3 % 2 0 4 ,1 0 9
A d d itio n a l S a le s ( U n its ) 0 0% 0 0% 0 0% 0 0% 0 0% 0 0% 0
C o m p a n y M a rk e t in g E 2x 1p , 9 9 9 ,9 8 62 4 % 7 4 9 ,9 9 8 2 2 % 1 ,0 0 0 ,0 0 42 2 % 1 2 0 ,0 0 0 2 0 % 3 0 0 ,0 0 0 1 8 % 3 0 0 ,0 0 0 1 3 %
% S ls % S ls % S ls % S ls % S ls % S ls
C o m p a n y S a le s ( c u r r e n2 c1 y5 ), 2 6 6 ,2 0 02 0 % 9 , 4 4 8 ,7 2 5 1 2 % 9 ,3 8 6 ,5 4 01 3 % 7 5 4 , 5 3 3 1 3 % 1 , 2 0 1 , 6 4 01 6 % 2 ,0 7 9 ,3 3 6 2 5 % 8 ,1 7 4 ,3 3 3
D e liv e r e d M fg C o s1 t3 4 , 0 0 0 ,0 6 86 2 % 6 , 1 1 3 ,1 1 2 6 5 % 4 ,3 5 4 ,0 5 54 6 % 3 8 9 ,2 5 0 5 2 % 5 9 1 ,2 6 7 4 9 % 1 ,0 8 2 ,6 8 6 5 2 % 4 ,4 4 3 ,3 3 1
G r o s s M a rg in 8 1 , 2 6 6 ,1 3 23 8 % 3 , 3 3 5 ,6 1 3 3 5 % 5 ,0 3 2 ,4 8 55 4 % 3 6 5 ,2 8 3 4 8 % 6 1 0 ,3 7 3 5 1 % 9 9 6 ,6 5 0 4 8 % 3 ,7 3 1 ,0 0 2
C o m p a n y M a rk e t in g E 2x 1p , 9 9 9 ,9 8 61 0 % 7 4 9 ,9 9 8 8 % 1 ,0 0 0 ,0 0 41 1 % 1 2 0 ,0 0 0 1 6 % 3 0 0 ,0 0 0 2 5 % 3 0 0 ,0 0 0 1 4 % 1 ,1 6 3 ,5 7 2
Im p o r t T a rif fs 2 5 , 8 3 1 ,9 4 41 2 % 5 6 6 ,9 2 4 6 % 0 0% 7 5 ,4 5 3 1 0 % 1 2 0 ,1 6 4 1 0 % 1 0 3 ,9 6 7 5 % 5 9 9 ,9 2 2
C o n t r ib u tio n M a rg in3 3 , 4 3 4 ,2 0 21 6 % 2 , 0 1 8 ,6 9 1 2 1 % 4 ,0 3 2 ,4 8 14 3 % 1 6 9 ,8 3 0 2 3 % 1 9 0 ,2 0 9 1 6 % 5 9 2 ,6 8 4 2 9 % 1 ,9 6 7 ,5 0 8
55
The Management Game Outputs—Market Report
Notice the line in the display titled “Additional Sales.” If one of your
competitors stocks out and their customers buy from you, these
sales will appear as Additional Sales for your company. In this
example, however, the company had no additional sales during this
period. It is important that you know how to distinguish between
sales that your company generated and sales that were given to you
by the poor planning of your competitors. Product 1 customers will
always behave like this. They will shop around until they buy a
product from some company. So a stockout in any product 1 market
will send customers to one of your competitors.
56
The Management Game Outputs—Market Report
Important! margins separated into country or product markets. This depiction of
your profitability includes an allocation of all of the costs which are
clearly associated with each individual market. Remember, since
these markets act independently, the marketing and pricing
decisions in one market will have no impact at all in any other
market. So, it is correct to allocate the full cost of marketing dollars
spent in Japan to the sales in Japan, since these marketing dollars
have no impact at all outside of Japan.
57
The Management Game Outputs—Market Report
Regardless of your choice, make sure you continue to manage your
business. It is probably poor use of your valuable time to try to
Important!
reproduce these numbers. You should either rely on them or
develop your own view of profitability.
58
The Management Game Outputs—Market Report
A company stocks
Consumer behaviors when confronted by “stock outs” are also
out when its
demand exceeds markedly different between Product 1 and Product 2. If your
its ability to supply
company accidentally stocks out, your Product 1 customers waste
products.
no time in going to your competitors and buying their products. The
reverse also applies, in that if one of your competitors stocks out,
you may receive additional sales (directly underneath Company
Sales in your marketing report) in the country where the shortage
occurred.
59
The Management Game Outputs—Market Report
P r o d u c t 1 P r ic e s R E L A T IV E
Ja pan re l p rc M e x ic o re l p rc C h in a re l p rc U .K . r e l p rc G e rm a n y re l p r c U .S . rel prc Q U A L IT Y
C om pany 1 4 ,6 0 0 .0 0 98% 3 2 5 .0 0 98% 4 1 0 .0 0 9 7 % 3 2 .0 0 109% 3 7 .0 0 96% 3 6 .0 0 93 % 90 .1%
C om pany 2 4 ,8 0 0 .0 0 103% 3 4 0 .0 0 102% 4 4 0 .0 0 1 0 4 % 3 1 .0 0 105% 3 9 .0 0 1 0 2 % 4 0 .0 0 1 0 3 % 1 15 .2%
C om pany 3 4 ,6 0 0 .0 0 98% 3 2 5 .0 0 98% 4 1 0 .0 0 9 7 % 2 9 .2 5 99% 4 0 .0 0 1 0 4 % 4 2 .0 0 108% 90 .6%
C om pany 4 4 ,8 0 0 .0 0 103% 3 5 0 .0 0 105% 4 4 0 .0 0 1 0 4 % 2 8 .0 0 95% 4 0 .0 0 1 0 4 % 4 0 .0 0 1 0 3 % 1 15 .5%
C om pany 5 4 ,6 0 0 .0 0 98% 3 2 5 .0 0 98% 4 1 0 .0 0 9 7 % 2 7 .0 0 92% 3 6 .0 0 94% 3 6 .0 0 93 % 88 .6%
A v e ra g e P ric e 4 ,6 8 0 .0 0 3 3 3 .0 0 4 2 2 .0 0 2 9 .4 5 3 8 .4 0 3 8 .8 0
P r o d u c t 2 P r ic e s R E L A T IV E
Ja pan re l p rc M e x ic o re l p rc C h in a re l p rc U .K . r e l p rc G e rm a n y re l p r c U .S .
rel prc Q U A L IT Y
C om pany 1 6 ,9 0 0 .0 0 101% 4 5 0 .0 0 98% 5 0 0 .0 0 100% 3 3 .0 0 97% 4 6 .0 0 102% 4 8 .0 0
C om pany 2 6 ,3 0 0 .0 0 92% 4 2 5 .0 0 93% 4 6 7 .5 0 94% 3 2 .0 0 94% 4 4 .0 0 97% 4 8 .0 0 98 % 1 16 .2%
C om pany 3 6 ,9 0 0 .0 0 101% 4 5 0 .0 0 98% 5 0 0 .0 0 100% 3 3 .0 0 97% 4 6 .0 0 102% 4 8 .0 0 98 % 79 .5%
C om pany 4 7 ,1 0 0 .0 0 104% 5 1 5 .0 0 112% 5 2 5 .0 0 105% 3 9 .0 0 115% 4 4 .0 0 97% 5 3 .0 0 98 % 1 16 .6%
C om pany 5 6 ,9 0 0 .0 0 101% 4 5 0 .0 0 98% 5 0 0 .0 0 100% 3 3 .0 0 97% 4 6 .0 0 102% 4 8 .0 0 108% 93 .0%
A v e ra g e p ric e 6 ,8 2 0 .0 0 4 5 8 .0 0 4 9 8 .5 0 3 4 .0 0 4 5 .2 0 4 9 .0 0 98 % 94 .7%
You can see that Company 4 has set their price at 115% of average
in the UK for product 2, while quality is below average at 93%. You
would not expect this to be popular with British consumers.
Be Careful!
You can improve the quality of your products by spending more
Increasing your
spending does not money on R&D. However, it is entirely possible to increase your
insure an increase in
R&D spending and still experience a drop in relative quality, if your
relative or absolute
quality. competitors are improving their products faster than you can improve
yours. The absolute quality of your products matter to your
customers as well as the relative quality. Absolute quality is
compared to a maximum theoretically possible quality which
increases over time as technology improves. If you do not improve
your products, their absolute and relative quality will drift lower over
time. If you increase your research spending more slowly than
technology advances, then you absolute quality could drop.
61
The Management Game Outputs—Market Report
Relative Price
Marketing budget
Relative Quality
Absolute Quality
Green Level
Availability
History
Company Image
Customers also compare your company’s variables with variables of
other companies to make their final buying decision, and they don’t
forget the past.
One reliable method of predicting future sales and customer
Important!
preferences is to analyze historical data carefully. As a rule,
consumer preferences and macroeconomic data that were true when
the historical data was collected, remain true going forward and, in
general, will not change. Therefore, time devoted to “mining past
data” is time well spent.
Even More
Important! It is dangerous to extrapolate conclusions beyond the ranges of the
historical data. For instance, some students build models to obtain
insight into price elasticity. While these are valuable insights, they
are only valid within the ranges of price and quality that appear in the
historical data. Once outside the range of the data, these insights
fail and you will have to revisit your analysis and update your
conclusions, as new data becomes available.
62
The Management Game Outputs—Market Report
C o n tra c t M a rk e t in fo rm a tio n
P ric e to b e a t
C o n tra c t W ith z e o Y o u r co n tra c t Y o u r C o n tra ct Y o u r C o n tra ct C o n tra c t
V o lu m e C o n tra c t S a le s re v e n u e S a le s co s t U S D / Im a g e fo r V o lu m e
T h is p e rio d W in n e rA d va n ta g e T h is p e rio d U N IT ST h is p e rio dU N IT N e xt P e rio d N e x t p e rio d
5 0 ,0 0 0 5 2 5 .0 0 0 0 0 0 0 .0 0 0 6 0 ,0 0 0
All contract sales involve only Product 1 in the United States.
Important!
Contract sales incur no transportation costs, no tariff costs and
require no containers. All activity in both of the 2 types of
contract markets is reported here as a composite transaction.
For our purposes, you can think of the contract market as being the
government bid market. The US government reacts with hostility
toward a company that tries to sell it a product at above retail prices.
63
The Management Game Outputs—Market Report
Therefore, your bid should be less than your retail price for product 1
in the United states.
Important!
One important thing to remember is that if you bid and win, you
supply the contract first and then you will supply your retail markets.
Be certain that you have enough inventory or production capacity
before you bid, because if not, your company will “stock out” in its
retail markets. This can be very damaging since not only are you
losing sales in what may be some of your most profitable markets,
but also Product 1 customers won’t wait around for you to restock
your inventory. Instead, they will take their business elsewhere.
If you stock out in the retail market for Product 2, you will lose profits
but your customers will wait and buy nothing—although their loyalty
to your brand will be reduced.
64
The Management Game Outputs—Market Report
contracts are different and you need to view these rules by visiting
the web site. The fundamental differences are listed here:
5. One team can win more than one contract. In fact, one team
could win all of the contracts at least in theory.
65
The Management Game Outputs—Market Report
66
The Management Game Outputs—Production Report
Production Report
67
The Management Game Outputs—Production Report
8 PRODUCTION REPORT
Period Currently Displayed Select Period to View
3 8
Company Number
Product 1 factory PRODUCT # 1
in China with cost CHINA
structure and LOCAL CURRENCY RESTATED IN USD
capacity This period % Of Full This period @ Next Period @ This period This period @Next Period @
Actual Capacity Full Capacity Full Capacity Actual Full Capacity Full Capacity
information Production Quantity 265,111 100% 265,111 261,797 265,111 265,111 261,797
Fixed Cost 9,718,622 100% 9,718,622 9,637,134 1,091,980 1,091,980 1,082,824
Variable Cost 37,343,279 100% 37,343,279 35,226,467 4,195,874 4,195,874 3,958,030
Total Cost 47,061,901 100% 47,061,901 44,863,601 5,287,854 5,287,854 5,040,854
Variable Cost per unit 140.86 100% 140.86 134.56 15.83 15.83 15.12
Product 1 Total Cost per unit 177.52 100% 177.52 171.37 19.95 19.95 19.25
warehouse showing INVENTORY PRODUCT 1
the 3 possible Inventory is valued Inventory Inventory Inventory Total Months of
in local currency Produced Produced Purchased Inventory Sales
inventory layers Previously This period This period
UNITS 0 0
1. Very old 0
132,952
0
132,952 1.95
VALUE 23,601,394 23,601,394
inventory from a COST / UNIT 0.00 177.52 0.00 177.52
previous period 2 PRODUCT # 2
2. Inventory GERMANY
1 3
remaining from LOCAL CURRENCY RESTATED IN USD
current period PRODUCT # 2
This period
Actual
% Of Full This period @ Next Period @
Capacity Full Capacity Full Capacity
This period This period @Next Period @
Actual Full Capacity Full Capacity
production Production Quantity 192,938 100% 192,938 207,193 192,938 192,938 207,193
Fixed Cost 1,520,379 100% 1,520,379 1,508,714 1,689,310 1,689,310 1,676,349
3. Inventory which Variable Cost 3,887,422 100% 3,887,422 4,458,587 4,319,358 4,319,358 4,953,985
was purchased for Total Cost
Variable Cost per unit
5,407,801
20.15
100%
100%
5,407,801
20.15
5,967,301
21.52
6,008,668
22.39
6,008,668
22.39
6,630,334
23.91
your company at the Total Cost per unit 28.03 100% 28.03 28.80 31.14 31.14 32.00
end of the time INVENTORY PRODUCT 2
period because your Inventory is valued Inventory Inventory Inventory Total Months of
ending inventory
in local currency Produced Produced Purchased Inventory Sales If a company
Previously This period This period
from current
UNITS 0
0
15,433 6,965 22,398 0.30 relocates a factory,
VALUE
production was less 432,567 214,025 646,592
it would appear here
COST / UNIT 0.00 28.03 30.73
than 10% of demand
as required. TRANSPORTATION REPORT
USD FACTORY RELOCATION ACTIVITY
Number of shipping containers you have now 486 NEW Company 1 Company 2 Company 3
Depreciation cost of your shipping containers in USD $76,720 Location P1
Transportation Fixed cost of maintaining your shipping containers USD $143,210
Cost of Renting containers requested by you USD $0
Location P2
Capacity P1
capacity, costs, Emergency cost of renting containers NOT requested by you USD $0 Capacity P2
Variable costs of shipping product -- USD $365,571 1 = Japan 2 = Mexico 3 = China 4 = UK
and activity TOTAL SHIPPING COSTS - USD $585,501
UNITS
485,892
C ap a city A na lysis
Information C o m p a n y 1 C o m p a n y 2C o m p a n y 3 C o m p a n y 4 C o m p a n y 5
about P ro d u ct 1 F a c tro y V a lu e 4 ,1 8 8 ,7 4 6 4 ,1 8 8 ,7 4 6 4 ,1 8 8 ,7 4 6 4 ,1 8 8 ,7 4 6 4 ,1 8 8 ,7 4 6N o te : D ivid e b y c o n s tru c tio n c o s t p e r u n it fo r th e c o u n try w h
competitors P ro d u ct 2 F a c to ry V a lu e 4 ,9 7 2 ,6 3 8 4 ,2 0 1 ,8 1 5 4 ,9 7 2 ,6 3 8 5 ,3 0 0 ,8 6 0 3 ,8 0 1 ,8 1 5e a c h fa c to ry is lo c a te d to c a lcu la te u n it c a p a c ity.
factory size and In ve n to ry A n alysis
inventory levels C o m p a n y 1 C o m p a n y 2C o m p a n y 3 C o m p a n y 4 C o m p a n y 5
P ro d u ct 1 In ve n to ry V a lu e 1 ,1 2 2 ,7 6 8 9 9 4 ,9 9 6 2 ,6 5 1 ,8 4 2 1 ,0 5 8 ,0 6 2 5 7 3 ,3 7 7
P ro d u ct 2 In ve n to ry V a lu e 1 ,3 8 0 ,6 7 8 2 ,1 2 3 ,1 5 9 7 1 8 ,4 3 6 7 3 7 ,9 9 0 6 ,5 6 0 ,3 2 7
68
The Management Game Outputs—Production Report
PRODUCT # 1
C HIN A
LO C AL CU R R E NC Y R ES TA T ED IN U SD
T his period % O f Full T his period @ N ext P eriod @ This period T his perio d @N ext P eriod @
Actual C apacity Full C apa city F ull C apacity Actual Full C apacityF ull C apacity
P ro duction Q uantity 265,11 1 100% 265,111 261,797 265,111 265,111 261,797
Fixed C ost 9,718,622 100% 9,718,622 9,637,134 1,091,980 1,091,980 1,082,824
V ariable C ost 37,343,279 100% 37,343,279 35,226,467 4,195,874 4,195,874 3,958,030
T otal C ost 47,061,901 100% 47,061,901 44,863,601 5,287,854 5,287,854 5,040,854
V ariable C ost per unit 140.8 6 100% 140.86 134.56 15.83 15.83 15.12
T otal C ost per unit 177.5 2 100% 177.52 171.37 19.95 19.95 19.25
IN V EN T O R Y PR O D UC T 1
Inventory is valued Inve ntory Inventory Inventory T otal M onths of
in local currency Produced P ro duced Purch ased Inventory Sales
Previously T his period T his period
U N IT S 0 132,952 0 132,952 1.95
VAL U E 0 23,601,394 0 23,601,394
C O S T / U N IT 0.0 0 177.52 0.00 177.52
This example shows the fixed and variable costs, as well as the unit
costs in Chinese currency (on the left) and US dollars (on the right).
69
The Management Game Outputs—Production Report
The middle column shows the costs that would apply if the
factory were operating at full capacity. These would differ from actual
costs whenever the factory was operated below full capacity.
Can you determine what number to put in Field 41 of your Input file in
order to operate this factory at 92% of rated capacity during the next
period?
Answer: If the prediction of future costs comes exactly true and
the exchange rates do not change, the entry would be
$1,082,824+0.92*3,958,030 = $4,724,211.60. To operate at 100%
capacity would require a budget of $5,040,854 or more.
70
The Management Game Outputs—Production Report
IN V E N T O R Y P R O D U C T 1
In ve n to ry is v a lu e d In ve n to ry In ve n to ry In ve n to ry T o ta l M o n th s o f
in lo c a l c u rre n c y P ro d u c e d P ro d u ce d P u rc h a s e d In ve n to ry S a le s
P re vio u s ly T h is p e rio d T h is p e rio d
U N IT S 0 1 3 2 ,9 5 2 0 1 3 2 ,9 5 2 1 .9 5
VALUE 0 2 3 ,6 0 1 ,3 9 4 0 2 3 ,6 0 1 ,3 9 4
C O S T / U N IT 0 .0 0 1 7 7 .5 2 0 .0 0 1 7 7 .5 2
Remember that all the costs displayed are in local currency. In this
Very case, we are still looking at a Chinese factory.
Important!
If you operate your factory correctly, all of your inventory that remains
unsold at the end of a given time period should have been
manufactured during that period. This type of product is reported in
the second column, called “Inventory Produced This Period.”
The first and third columns will normally contain zeros, unless you
are having difficulty managing your inventory. Inventory levels may be
too high or too low when compared to your sales.
71
The Management Game Outputs—Production Report
If it becomes necessary to purchase inventory, you will pay $3.00 over
Important! your current period manufacturing cost per unit to buy this product.
You are required to end the period with a buffer of 10% inventory
or more. If you do not manufacture enough product, you will be
For more
information about forced to buy it at the higher, $3.00 premium cost, thus increasing
the Production
your costs. Remember, if inventory is purchased for you, it is
Budget input,
please refer to the purchased at the very end of the time period after all sales are
Inputs section.
complete. This purchased product can not be sold until the following
You can calculate simulation cycle.
exactly how much
money is required
to operate your
factory at full Regulating Your Production Capacity
capacity because
you know both Your team can choose the level of operation for your factories by
the fixed costs allocating a Production Budget in the Input interface. If you scale back
and the variable
costs for a given on the amount of funds you allocate to production, your factories, in
period. turn, will scale back production to remain within the budgeted limit.
72
The Management Game Outputs—Production Report
The overall value of a factory will depreciate over time, and with it,
maximum production capacity. To maintain a fixed production
capacity, your company will need to reinvest additional plant capacity
equal to the amount of depreciation. The financial depreciation rate is
always equal to the real depreciation rate of your factories and so the
book value of your factories, (as well as those belonging to your
competitors) will always equal their replacement cost. This permits
you to monitor the production capacity of your competitors by
watching their balance sheet information.
Moving factories is an expensive decision. Make sure you analyze the
Important!
costs and benefits before you proceed. Make sure you understand
the differences between CASH FLOWS and EXPENSES
associated with relocating a factory.
73
The Management Game Outputs—Production Report
74
The Management Game Outputs—Production Report
that each product stays in its own warehouse. The variable storage
fee depends on the level of ending inventory.
75
The Management Game Outputs—Production Report
If you operate your factory at very low capacity and generate inventory
that has a cost per unit greater than the average of all retail prices,
then this inventory will be "written down" to the average retail price
that prevails in the market. This loss appears in the Detailed Income
portion of your financial report. This feature forces inventory created
at very high unit cost to impact profits in the period in which it is
manufactured rather than when it is sold to reflect the reality that this
product can never realistically be sold at a profit. This prevents your
company from holding inventory and delaying the loss recognition
beyond the current period.
76
The Management Game Outputs—Production Report
Remember:
Each container holds 1,000 units of either product.
Important!
The purchase price for new containers is $3,000 (US). These
containers last about five years before they wear out; therefore you
should replace them from time to time.
The rental price for containers is $2,000 (US) per three-month
period—pretty expensive when compared to the purchase price.
The emergency rental rate is $3,000 (US) for a three-month
period. This is clearly a punishingly high rate.
77
The Management Game Outputs—Production Report
TRANSPORTATION REPORT
USD
Number of shipping containers you have now 486
Depreciation cost of your shipping containers in USD $76,720
Fixed cost of maintaining your shipping containers USD $143,210
Cost of Renting containers requested by you USD $0
Emergency cost of renting containers NOT requested by you USD $0
Variable costs of shipping product -- USD $365,571
TOTAL SHIPPING COSTS - USD $585,501
UNITS
Next period shipping capacity (units) if you do not buy any containers 485,892
The actual move occurs as the next period begins. Notice that the
table indicates the new capacity of the relocating factory. This gives
78
The Management Game Outputs—Production Report
Capacity Analysis
Inventory Analysis
Company 1 Company 2 Company 3 Company 4 Company 5
Product 1 Inventory Value 1,122,768 994,996 2,651,842 1,058,062 573,377
Product 2 Inventory Value 1,380,678 2,123,159 718,436 737,990 6,560,327
79
The Management Game Outputs—The Finance Report
80
The Management Game Outputs—The Finance Report
As you can see, your finance report is divided into eight areas:
3. Tariff Rates
4. Transport Rates
7. Insurance Information
81
The Management Game Outputs—The Finance Report
Do not underestimate the amount of information you can gather from
Important!
these balance sheets.
82
The Management Game Outputs—The Finance Report
Remember that as you spend more and more money on collections,
Important!
at some point, you will begin to reach diminishing impact and your
money will be wasted.
As for the other fields in the Balance Sheet Data section, consider the
following information:
83
The Management Game Outputs—The Finance Report
IN C O M E S T A T E M E N T D A T A
C o m p a n y 1% C o m p a n y 2% C o m p a n y 3% C o m p a n y 4% C o m p a n y 5%
T o ta l S a le s R e v e2 n0 u,6e5 5 ,7 8 0 2 1 ,2 4 1 ,5 3 9 1 9 ,3 3 1 ,5 1 7 2 1 ,3 4 1 ,4 9 0 1 9 , 9 8 8 ,8 8 6
N e t In c o m e 3 6 5 ,9 6 2 2 % 5 4 5 ,6 8 9 3 % 5 9 ,2 6 9 0 % 5 3 0 ,5 2 5 2 % 3 5 4 ,8 9 7 2 %
A n n u a liz e d R O E 6 % 10% 1% 9% 6%
84
The Management Game Outputs—The Finance Report
As you read these tables, remember that while the rows represent
country of destination, the columns represent countries of origin. In
the table above, the first row displays the rates from various countries
to Japan. Similar logic applies to the transportation rates.
85
The Management Game Outputs—The Finance Report
CU RRENCY CO N TR ACTS
L a st P e rio d L a s t P e rio d T h is P e rio d T h is P e rio d B u y o r C o n tra cts G a in o rS e ttle m e n t
L o ca l C u rre n cy p e r U S pDo t R a te F o rw a rd R a te S p o t R a te F o rw a rd R a te S e ll M illio n s L o ss U S D o lla rs
Y E N 1 3 7 .0 0 1 39 .0 0 1 3 4 .0 0 1 3 9 .0 0 S e ll 3 0 0 .0 0 L o ss (8 0 ,5 3 3 )
PESO 9 .3 0 9 .4 0 9 .4 0 9 .5 0 S e ll 1 0 .0 0 0
YUAN 8 .7 0 8 .9 0 8 .9 0 9 .0 0 Buy 1 0 .0 0 0
PO UND 0 .6 9 0 .6 9 0 .6 9 0 .6 8 S e ll 3 .0 0 0
M ARK 0 .9 0 0 .9 0 0 .9 0 0 .9 0 Buy 5 .0 0 0
The first four columns list the spot and forward rates that were in
place three months ago and are currently in place. You can buy and
sell any of the currencies in million-unit blocks, but only three months
in advance. (Please consult the Inputs section for more information
and a detailed example.) The far right column shows the gain or loss,
if any, on the currency contracts put in place at the start of the period.
In this example, 300 million yen were SOLD at 139. When the new
spot rate was published, the yen was more valuable than expected at
134; so there was a small loss on this particular contract of $80,533.
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The Management Game Outputs—The Finance Report
The Plant Sale Loss field captures the 25% loss that results
from selling factory capacity. This field also captures the cost of
moving a factory if you should choose to move one. If neither of these
conditions apply, the field will be 0.
The Inventory Writedown field captures the decrease in
inventory value that results from operating your factory at low volume.
This, too, is unusual and the field will normally be 0 (see earlier
discussion about Inventory Writedown).
The Depreciation rate for factories is 1.25% per quarter. The
depreciation rate for containers is 5% per quarter.
87
The Management Game Outputs—The Finance Report
A Note on Taxes
Taxes—in the name of simplicity, are calculated at a flat tax of 34%
and this one rate applies to all taxable income no matter where in the
world it is earned. While this may be unrealistic, it becomes
cumbersome to track and understand your taxes if you paid them
locally. If you lose money, the loss carries forward and never expires.
The losses will be carried as a negative taxes payable account
balance until they are offset by future profits.
Insurance Summary
INSURANCE SUMMARY
Rates are USD per 100,000 coverage per QTR.
Rate Coverage $ Premium $
Property / Casualty 400 5,000,000 20,000
Directors & Officers 300 13,333,333 40,000
Product Liability 1,000 10,000,000 100,000
88
The Management Game Outputs—The Finance Report
The quarterly interest rates for money that you lend to the bank or
borrow from the bank are also listed. These rates will fluctuate from
time to time but will always be published one period in advance to aid
your planning.
89
The Management Game Outputs—The Finance Report
You can see a company image for product 1 and product 2 published
for your company. This is an index which will grow 0.1 each quarter
that your company does not stock out. If your company does stock
out, then this image will be decreased temporarily in proportion to the
size of the stockout. This index is provided to remind you that your
demand will be depressed in the period following a stockout but this
negative impact will pass. You will know that the negative impact is
finished when the index returns to its original trend line. For example,
let's say that your company image at the end of period 8 is equal to
2.0. Assume that you stockout in period 9 and the index in the output
at the end of period 9 is 1.8. You then know that your demand in
period 10 will be depressed about 10% from what it would have been.
Now let's presume that at the end of period 10, your company image
is 2.2, (it has recovered to where it would have been, absent the
stockout). You then know that your demand in period 11 will be
unaffected by the stockout which occurred in period 9. Effectively,
your customers have forgotten about the stockout. A very large
stockout may take longer to be forgotten than a very small stockout.
90
The Management Game Outputs—The Finance Report
Dividend payment 0
91
The Management Game Outputs—The Finance Report
The following lists provide the cash flow dynamics that you need to
know to play the Management Game, in no particular order.
Cash Arriving—Collections
Cash Departing—Disbursements
92
The Management Game Outputs—The Finance Report
Marketing expenses
Research and development costs
Consultants
Collections budget
Insurance
Administrative and Miscellaneous Fees
In addition, if your cash at the start of the period plus cash inflows at
the beginning of the period exceed your disbursements, then you earn
interest income on the excess. However, if your disbursements
Important! exceed your cash plus inflows, then you are insolvent and "checks
will begin bouncing." When this happens, the system will not
complete requested expenditures.
Remember, it is the “inter-period cash excess” that cannot fall below
Important! zero. It is possible to have cash at the beginning and cash at the end
of the period and still run out of cash in the middle.
93
The Management Game Outputs—The Finance Report
These factors mean that you not only control all the really large cash
disbursements but you also know about them in advance.
94
The Management Game Outputs—The Finance Report
95
The Management Game Outputs—The Finance Report
Index
[m = margin note]
auctions, difference between the two types, 23
auctions, on-line government contract, 23,62
bad debt recovery, 43m
cash flow dynamics, 89
cash flows and expenses, examples, 71-72
cash flows based on team's input vs. automatic, 92
cash inflows at beginning of period, 5 items, 90
cash inflows at end of period, 2 items, 90
cash outflows at beginning of period, 15 items, 90
cash outflows at end of period, 4 items, 91
collection budget, an example and bad debt rate, 43
collection budget, description, 43
company image product 1 and product 2, 88
competitor operational data, capacity and inventory, 77
containers, 26
containers, an example, 27
containers, description and key conditions, 27
contract image and its advantage, 22m
contract image improvement in contract auction, 61
contract prices, government contracts, 22,61
contract sales, an example and conditions, 61-62
contracts, no containers, shipping costs, tariffs, 25
contracts, sealed bid, 22
contribution margin, 56
countries, 8
customer preferences, fixed and identical, 12m
decisions, 15 production , 19
decisions, 44 marketing, 18
decisions, 9+5+5=19 finance decisions, 19
dividends, description, 42
equity refers to common stock and retained earnings, 41m
extrapolating beyond ranges of data, a warning on, 60
factory capacity decrease, an example, 36
factory capacity decrease, description, 36
factory closure, 37
factory construction (expansion), description, 35
factory construction, an example, 36
factory depreciation, 35
factory design, 7 key game rules, 10
factory expansion, tips on, 71
factory relocation report, 76-77
factory relocation, an example, 39
factory relocation, cost structure, 39
factory relocation, description, 38
factory relocation, effect of consultants, 39
factory relocation, input, 38, output, 76
field (input) name, 18
finance report, 16, 78
finance report, balance sheet data, 6 key data, 80
finance report, currency contracts, examples, 84
96
The Management Game Outputs—The Finance Report
98