MIT Sloan: A Renewable

Resource Management
Simulation
Scenario
 Ships owned: 3
 Market value of each ship: $300
 Bank Balance: $600
 Duration of the Game: 20 Years

Key Highlights
 The simulation ended with a loss of $6364 whereas the highest profit was earned in year 15
which as $10,572.
 The total revenue earned from fishery was $187630 and from interest was $2572 making
the total revenue to be $190202.
 The total fleet size was 205 at the end.
 Being an individual simulation there was no sale of ships and hence no revenue from ship
sale.
 The ship market saw a very fluctuating graph in terms of ship prices where the highest was
$1044 and lowest was $5.
 Despite the fish catch being good in the 17 th year, in the 18th year the fish catch dipped which
resulted in cumulative losses.

Decisions Taken
 At the beginning of the simulation I decided to keep fishing and increase my bank balance, I
was also waiting for the ship’s market price to rise so that my asset value increases.
 I kept my ships in a high low ratio at the coast and deep and none at the harbour to earn
maximum profit. I also kept the ratio according to the profit each fishing trip would reap and
allowed the fishes to grow every year by straining either deep or coast alternatively.
 Later, when fishery became a loss making business I kept my ships at harbour to incur
minimum loss.
 I bought maximum ships when the market value of ships rose to maximise asset value, and
tried to understand the market trend.
Analysis of Result
 The result shows that I became over-ambitious and the market collapsed because of my bulk
buying of ships towards the end.
 There were no fishes left towards the end hence there was no source of revenue left.
 The cost of keeping the ships even at the harbour to let the fishes regrow was more than
what I could bear and hence the loss at the end of the game.

Learnings and Takeaways (brief about what worked and what didn’t.)
 The decision to let the fishes regrow and keeping a good ratio of ships at coast and deep
seemed to work well.
 The rising market price of ships and my purchases in those years had a positive impact on
the value of assets.
 My strategy of deploying more ships in profitable areas of the ocean and buying when the
market price of ships was high seemed to be working well and paid off well till the 17 th year
of the business, after which I should have been more careful to avoid losses.
 The graphs helped in interpreting my decisions clearly and understand and predict the
trends.
 The expected profit per ship was a key indicator which helped in deciding how many ships
needed to e deployed in what part of the ocean.
 The game helped me understand how asset maximisation is always the goal and that we
should always keep an eye on the bigger picture.
 I should’ve purchased more ships only when there was stability in the market.
 The game helped me learn how even the slightest changes effect the market and the
business.
 I learnt how important it is to have a holistic view and deploy all the managerial skills and
learnings, trend analysis being a major part throughout this game.
 The simulation provided me with a chance to learn the fundamentals of sustainable
management of renewable resources through quantitative factors and comprehensive
learning.

Challenges Faced
 Being an individual simulation I could not sell my ships when faced with losses. If there were
any options to sell my ships, I believe I would not have ended in losses.
 The most challenging was maintaining the profits and understanding the market trends.
 Fishery is not easy and neither is ensuring a good catch, which made profit making difficult.
 Maintaining the bank balance and value of assets was a challenge given that the information
available was limited and the market became unpredictable towards the end.

Submitted by-
Mansi Kedia
PG20201102