The simulation provides end-to-end overview of manufacturing business; from buying raw materials to delivery finished goods to customer. The challenge of the simulation lies in 3 inter-link modules;
Production Module – emphasizes in production planning, product changeover cost, tradeoff product variety VS higher unit cost, capacity utilization, expansion of factory, investment VS leasing decision, labor force requirement, tradeoff of skill VS unskilled labor, etc.
Financial Module – requires participants to create their own financial statement, and review key financial performance indicators (Gross Margin, Net Profit, ROE, Operating Expense ratio, Inventory turnover, Cash conversion cycle, etc)
Business Diversification Module – the facilitator will simulate “Red Ocean” environment and encourages participants to take calculated risks; differentiate their product, invest R&D, and venturing into new market, etc.
Develop understanding of overall business process
Develop planning skill that synchronize production activities to sale activities
Improve financial analysis skill and deep understanding of financial statements
Encourage undergraduates to consider strategic options that migrate away from competitive environment
Emphasize critical success factors that create alignment between vision and strategy