GLOBAL OPERATIONS an exploration of business strategy - PowerPoint PPT Presentation

1 / 13
About This Presentation
Title:

GLOBAL OPERATIONS an exploration of business strategy

Description:

The strategic development of a high technology business - the Virtual Patient (VP) ... Overdraft Interest - 20% Interest received on cash balances - 6 ... – PowerPoint PPT presentation

Number of Views:33
Avg rating:3.0/5.0
Slides: 14
Provided by: jeremyj1
Category:

less

Transcript and Presenter's Notes

Title: GLOBAL OPERATIONS an exploration of business strategy


1

GLOBAL OPERATIONSan exploration of business
strategy
2
GLOBAL OPERATIONS
  • The strategic development of a high technology
    business - the Virtual Patient (VP)
  • With decisions covering
  • which markets to serve
  • product development
  • capacity planning
  • funding
  • information needs

3
Global Operations The Issues
  • business/market/product portfolios
  • financial measures business success
  • gap analysis
  • fast to market
  • customer/market needs
  • operational efficiency
  • cash flow survival

4
The Simulation
  • Preparation
  • familiarisation
  • define responsibilities
  • set objectives
  • decide strategies
  • Decision Making
  • submit decisions
  • business simulated
  • analyse results
  • research markets
  • Review Debriefing
  • make directors report
  • review results

5
The Situation
  • new business
  • one million equity from parent company
  • new, high tech product (the Virtual Patient)
  • strategic management
  • several competitors
  • test marketed in Europe
  • can sell globally
  • can borrow up to 50 of equity
  • financial items measured in Account Units (AUs)

6
The Global Markets
  • Europe
  • North America
  • South America
  • Japan
  • SE Asia
  • India
  • Middle East
  • Africa
  • All are different in terms of potential and need
  • Currently like todays world but may change.

7
Operations Information
  • No factory
  • Factory Capacity bought in blocks of 1,000
  • 5 to 9 blocks cost 100,000 AUs per block
  • 10 to 24 blocks cost 90,000 AUs per block
  • 25 blocks and above cost 75,000 AUs per block
  • Material Costs - 50 AUs per unit of production
  • Direct Labour Costs - 25 AUs per unit of
    production
  • Indirect Costs - 20 AUs per unit of capacity
  • Production Overheads - 20,000 AUs per year
  • Multiple Product Cost - 20,000 AUs per product
  • Depreciation - 10 per year.

8
Financial Information
  • Other Expenses
  • Market Overheads are 20,000 AUs per market
  • General Overheads are 50,000 AUs per year
  • Royalties are 5 AUs per unit sold
  • Current Bank Interest
  • Term Loans - 12 plus 1 arrangement fee
  • Overdraft Interest - 20
  • Interest received on cash balances - 6
  • Interest premiums will be charged if gearing gt
    50
  • Other Information
  • Tax rate 33
  • Long term parent company requires a 12 dividend

9
Product Information
  • Current Product is Model 1
  • Subsequent products are Model 2, 3 etc.
  • Later models are more sophisticated
  • But will cost the same to manufacture
  • To develop Model 2 will cost 300,000 AUs
  • But later models will cost more.
  • Ultimately can sell several products
  • Only one model may be offered to a market

10
Decisions
  • Market Decisions
  • whether to serve or not
  • if served
  • Price
  • Promotion
  • Product
  • Other Decisions
  • Product Development
  • Production Capacity
  • New Long Term Loans
  • Dividends

11
The Results
  • Company Reports
  • Preliminary Results
  • Full Results
  • Market Report
  • Other Information
  • Profit Loss Account
  • Balance Sheet
  • Key Measures
  • Competitive Report
  • Comments
  • Business Research
  • Company Reports
  • Market News

12
Market Research
  • Competitive Report
  • Market Potentials
  • Economic Trends
  • Test Markets
  • Other Research
  • Research is charged for.
  • Produced during each decision period.
  • No research until second year.

13
Observations
  • it takes time to understand
  • but the business still must be run
  • so your decisions will not be perfect
  • time will be a constraint
  • but, by the end you should be just in command of
    your business!
  • your business competencies will be challenged
  • and you should have fun.
Write a Comment
User Comments (0)
About PowerShow.com