MBA INTEGRATION SIMULATION INTOPIA

WHY SIMULATION? ARTIFICIAL REALITY INVOLVING LIFE- LIKE DYNAMICS OF THE COMPETITION AND MARKETPLACE A VEHICLE FOR UNDERSTANDING MANAGEMENT PRINCIPLES AN EXERCISE IN ENTREPRENEURSHIP, TEAM WORK, TOP MANAGEMENT, STRATEGIC ALLIANCES, AND INTERNATIONALIZATION A CHANCE TO RUN A BUSINESS

KEY OBJECTIVES OBJECTIVES-STRATEGY-IMPLEMENTATION ENVIRONMENT SCANNING DECISION-MAKING UNDER UNCERTAINTY. INTERFUNCTIONAL COORDINATION NEGOTIATION SKILLS SURPRISE & CRISIS MANAGEMENT HQ-SUBSIDIARY RELATIONSHIPS UPPER-MANAGEMENT TEAM DYNAMICS

WHAT IS IT? IN AN ARTIFICIAL WORLD OF INTOPIA THERE ARE THREE MARKETS: THE US, EU, AND BRAZIL. THE ONLY INDUSTRY THAT EXISTS IS THE PERSONAL COMPUTER/CHIPS INDUSTRY. EACH MBA TEAM RUNS AN INDEPENDENT COMPANY IN THAT INDUSTRY. EACH COMPANY IS REGISTERED IN LIECHTENSTEIN, A TAX HAVEN COUNTRY. EACH SUBSIDIARY IS AN INDEPENDENT LEGAL ENTITY IN THE MARKET.

FINANCE EACH COMPANY STARTS FROM SCRATCH WITH INITIAL CAPITALIZATION OF 20M SF. COMPANIES CAN CHOOSE TO INVEST IN PLANTS TO MANUFACTURE CHIPS OR PCS OR BOTH IN EACH MARKET. CAPITAL NEEDS COULD DICTATE A NEED FOR LONG-TERM LOANS. BEING A GLOBAL COMPANY, OPERATIONS ARE IN FOUR DIFFERENT CURRENCIES. SHORT-TERM LOANS ARE ALSO AVAILABLE.

ORGANIZATIONAL BEHAVIOR THE GAME DOES NOT DIRECTLY INVOLVE BEHAVIORAL ASPECTS OF MANAGING STAFF AND LABOR. HOWEVER, THE TOP-MANAGEMENT TEAM IS COMPRISED OF 3-5 MEMBERS. TEAM MEMBERS CAN TAKE DIFFERENT FUNCTIONAL RESPONSIBILTIES AND CREATE AN ORGANIZATIONAL STRUCTURE. WATCH FOR THE INTRA-TEAM AND INTER- TEAM DYNAMICS.

PRODUCTION CHIPS ARE AN INPUT FOR PCS. THERE IS A KNOWN RATIO OF INPUT TO OUTPUT. CHIPS CAN BE PRODUCED IN-HOUSE OR PURCHASED FROM OTHER COMPANIES. CAN HAVE UPTO 3 PLANTS FOR EACH PRODUCT IN EACH MARKET--THERE ARE ECONOMIES OF SCALE. PLANT CAPACITY IS FIXED. PLANTS BECOME OLD; NEED MAINTENANCE.

LOGISTICS PLANTS TAKE ONE PERIOD TO BUILD. PRODUCTION OF EACH PLANT FOR EACH PERIOD MUST GO INTO INVENTORY FOR SALE IN THE SUBSEQUENT PERIOD. INTER-COMPANY SALES OR INTRA- COMPANY SALES ACROSS MARKETS TAKE A PERIOD IF SURFACE SHIPPED. AIR SHIPMENTS MATERIALIZE IN THE SAME PERIOD.

ACCOUNTING WHEN YOU SELL, YOU DON’T RECEIVE TOTAL PROCEEDS IN THE PERIOD OF SALE. LIKEWISE, WHEN YOU INCUR EXPENSES, YOU DON’T PAY FULLY IN THE PERIOD OF PURCHASE. THERE ARE SOME EXCEPTIONS, ESP. IN INTER-COMPANY SALES/PURCHASE. EACH SUBSIDIARY REPORTS IN ITS LOCAL CURRENCY, WITH CONSOLIDATED STATEMENTS PRESENTED AT HQ IN SF.

MARKETING BOTH CHIPS AND PCS CAN BE SOLD IN ANY MARKET. EXPORTS AND IMPORTS ARE POSSIBLE. OBVIOUSLY, THERE IS A LARGER CONSUMER MARKET FOR PCS THAN CHIPS. MARKET SHARE MAY BE A FUNCTION OF PRICE, PRODUCT, DISTRIBUTION, AND PROMOTION.

R&D EACH COMPANY STARTS WITH GRADE ZERO FOR CHIPS AND PCS. THEY CAN UPGRADE TO A HIGHER- GRADE PRODUCT THROUGH R&D. COMPANIES CAN UPGRADE TO GRADE 9 AT THE MOST.

MARKET INTELLIGENCE SUBSTANTIAL AMOUNT OF MARKET INTELLIGENCE IS AVAILABLE FOR PURCHASE. IT TAKES A PERIOD TO ORDER CONSULTING SERVICES OR REPORTS. YOU CAN ONLY PURCHASE UPTO 6 PIECES OF INFORMATION IN ANY PERIOD, SO PLAN AHEAD.

WHAT IS MY ROLE? HUMBLE GAME ADMINISTRATOR GOVERNMENT OF EACH MARKET TAX AUTHORITY OF EACH MARKET BANKER & INSURER LABOR & TRADE REPRESENTATIVE JUDICIAL AUTHORITY & ARBITRATOR CONSULTANT

LOGISTICS OF THE GAME! READ THE INTOPIA EXECUTIVE GUIDE. BECOME FAMILIAR WITH THE INTOPIA WORLD. PREPARE A PLAN FOR YOUR COMPANY: DUE BY THE FOURTH WEEK. BE READY TO PLAY IN FIVE WEEKS. WILL PLAY SIX PERIODS IN FALL. AND SIX PERIODS IN SPRING. WILL WRAP-UP WITH A FINAL REPORT IN THE CAPSTONE STRATEGY CLASS.

QUESTIONS? SANJEEV AGARWAL ASSOCIATE PROFESSOR DEPARTMENT OF MARKETING 368C CARVER HALL TEL: