bfound capsim
pricing plays a role when:
in the rough cut stage of the purchase decision, in the fine cut stage of the purchase decisoin
MTBF measures what?
reliability, size, market segment
What section of the perceptual map is considered ideal for the low end segment?
upper left
A segment manager's task is to?
verify the products entering and leaving a segment, the margin potential for those products, capacity level and the distribution system as compared to competitors
How much does it cost for MTBF per 1,000 hours of reliability?
.30
As a manager you need to change the automation level of your segment from 2 to 5. The line has a capacity of $2million. How much would it cost?
24 million
If you drop your sales budget to zero, accessibility drops to 0% in how many years?
3
the customer survey score is driven by the?
4 p's
If a line has a capacity of 100,000 units, the cost of changing the automation level 1 unit either up or down is
400000
if you are currently producing 100,000 units and your automation level is 10, how much will it cost you to doubleyour capacity?
4600000
how many market segments are there?
5
If a product's Price was $20, its Material $8, and its Labor $7, the Margin Per Unit would be:
5 dollars
The reliability component cost of a product with a 17,000 hour MTBF rating is:
5.10
Assuming no additional product promotion, what percent of customers, reached through last year's marketing campaign will carry over into the current year?
67%
If current wages are set at $10/hour, what would be the minimum starting pay that your company would offer?
8/hour
The Perceptual Map is
A marketing tool used to compare products against customer perceptions
Which three factors drive labor cost?
Wage and benefit rates, Automation levels, Second shift/Overtime costs
Each segment places?
a different emphasis on the 4 buying criteria
The economic environment for this simulation game will include
a favorable environment featuring modest growth, low inflation, and reasonable interest rates
Once you upload your official decisions during a round, how many times can you change them before the end of theround?
as many times as you want
Which of the following are not considered in the Fine Cut?
automation
Increasing a product's reliability will result in which of the following changes to production costs?
higher material costs
MTBF is measured in
hours
When an R&D effort started in 2001 completes on September 15, 2002, the product revision kicks in
immediately upon completion
Over time, the segments will drift in which direction on the Perceptual Map?
down, right
The prices in each segment
drop by .50 each year
At which point does the perceived age of a traditional product peak?
2
If you are currently producing 100,000 units at an automation level of 5, how much would it cost to maximizeautomation?
2,000,000
If you are marketing to High End customers, which criteria are most important to them in order of importance?
Positioning, Age, MTBF, Price
minimum time it takes to create a new product?
1 year
Which Automation rating requires the longest time to reposition a product?
10
If you increase automation from 2.0 to 5.0, the cost is
12 dollars per unit of capacity
If you want to add 500,000 units of capacity to an assembly line with an automation rating of 5, how much will itcost?
13,000,000
This strategy will allow us to maintain a presence in every market segment. Competitive advantage will be gained by keeping R&D costs, Production costs and raw material costs to a minimum, enabling us to compete on the basisof price. We will price below average. We will increase automation levels to improve our margins and to make itacceptable to run second shift/overtime.
Broad Cost Leader
This strategy will allow us to maintain a presence in every market segment. Competitive advantage will be gained by distinguishing our product with an excellent design, high awareness, and easy accessibility. We will develop anR&D competency that keeps our designs fresh and exciting. Our products will keep pace with the market, offeringimproved size and performance. The price of the products will be above average and capacity will expand as wegenerate higher demand.
Broad Differentiation
This strategy attempts to gain a competitive advantage by keeping R&D costs, production costs and raw materialcosts to a minimum in order to compete on the basis of price. The product life cycle focus will enable sales for many years on each new product introduced into the High End segment. Products will begin their lives in the HighEnd, mature into Traditional and finish as Low End products before they are retired and their assets harvested.
Cost Leader with Product Life Cycle Focus
The segments all drift to the lower-right section of the perceptual map. Why does this drift take place?
Customers want smaller faster products
This strategy will gain competitive advantage by distinguishing our products with an excellent design, highawareness, easy accessibility, and product extenders. We will develop R&D competency that keeps our designsfresh and exciting. Our products will keep pace with the market, offering improved size and performance. We will price above average. We will expand capacity as we generate higher demand in our markets: High, Traditional and low end
Differentiation Strategy with a Product Life Cycle Focus
When opening the Excel version of Capsim, you should do what to Macros?
Enable
What is the right formula for capacity investment?
Investment = Capacity x [$6 + ($4 x Automation)]
When tracking market segments on the performance and size perceptual map, which segment moves or "drifts" the slowest?
Low
n the Rough Cut buying stage, "reliability" is expressed in terms of:
MTBF
MTBF in the segments should be
MTBF (Performance) > MTBF (High End) MTBF (Low End) < MTBF (Size).
The relative cost of a product's material cost increases as
MTBF goes up
It takes ______ years to invent a product.
More than 1 year but no more than 3 years
What is the difference between the market segments at the beginning of the round to the final round?
The fine cuts overlap in the beginning and in year 8; only the rough cuts overlap
What is one drawback of increasing automation?
The product requires increased time/expense for subsequent short-move repositioning.
What are three of the five Segments?
Traditional, low end, performance
The A/R lag is
a marketing spreadsheet definition. the accounts receivable lag (in days). the time between customers receiving products and when they are expected to pay for them.
How is the strength of the sales channel measured?
accessibility on a scale from 0 to 100%
how can assembly lines double their capacity?
add a second shift
What is the most important criteria to a "Traditional Segment" consumer?
age
customer demand is driven by
customer survey
An increase in promotional budgets have:
decreasing returns over time
promotion efforts are resulted from?
diminishing returns
When a product is moved to a new location on the Perceptual Map, the Perceived Age (or Age) is:
divided in half
Which customer group or market segment seeks cutting edge technology in both size and performance?
high end
The Promotion part of marketing in CapSim allows teams to allocate their time based on
each product
What's the measure for product reliability?
expected time a product lasts
How many products does every team start with?
five
At what dollar amount above the segment guidelines is all consumer appeal lost?
five dollars
In order for a team to win at CapSim, they need to..
have a proactive strategy, contingency plan, open communications, strong knowledge of the industry and have a strong understanding of the analyst report
In order to achieve 100% accessibility, a team must:
have at least two products in a segment
Changing MTBF will:
have no impact on perceived age
If you reduce automation in the production component of Marketing, you will:
incuur a retooling cost
If you purchase production capacity and automation:
it is available in the next year
What happens to a product priced at $1 above or below the segment guideline when a segment's product supply outstrips demand?
it loses 20% of its appeal
What happens to a product's Perceived Age when it is repositioned in R&D?
its reduced by 50%
Rapid movement of an existing product on the Perceptual Map requires
low automation levels
Which customer group or market segment seeks proven products, are indifferent to technological sophistication, andare price motivated?
low end
Which market segment places the most importance on price?
low end
Customers that want low prices and are willing to sacrifice miniaturization and performance are in the
low end segment
The Traditional ideal spot is
near the center of the circle
This strategy will concentrate on the Traditional and Low End segment. Competitive advantage will be gained bykeeping R&D costs, Production costs, and raw materials costs to a minimum, enabling us to compete on the basis of price (low prices). The product will be priced below average and automation levels will be increased to improvecontribution margins and make it acceptable to run second shift/overtime
niche cost leader
This strategy will focus on the high technology segments (High End, Performance and Size). Competitiveadvantage will be gained by distinguishing our products with excellent design, high awareness, easy accessibility,and product extenders. Our R&D competency will keep our designs fresh and exciting. Our products will keep pace with the market, offering improved size and performance. The prices of our products will be above averageand we will expand capacity as we generate higher demand.
niche differentiation
If a product's Automation rating is substantially increased, it will:
no longer move along the perceptual map
If your team decides to introduce a new product, when should capacity and automation be purchased?
one round pior to product release
Depreciation is calculated:
over a straight line 15 year period
Which customer group or market segment seeks high reliability, advanced technology products that emphasize high performance?
performance
Which three customer groups "ride the wave of technology" and are considered to be in the high technology segments?
performance, high end, size
The two characteristics that the perceptual map evaluates are
performance, size
Combining size and performance creates a product attribute known as
positioning
What are the top buying criteria that low end customers most value?
price
The top two buying criteria for each segment is:
price for low end positioning for high end
Low Tech customers emphasize buying criteria in which order?
price, age, positioning, reliability
Marketing is concerned with 4 things. What are they?
price, place, promotion, product
The marketing spreadsheet is used to set which of the following:
price, promotional budget, sales budget
Age refers to:
product age
Inside each fine cut circle,
segments have an ideal spot where demand is at its highest.
Which customer group or market segment seeks advanced technology products that focus on small size?
size
Customers that want small products and are willing to sacrifice performance are in the
size segment
Cash position is
the cash position at the beginning of the round and a projection of the cash position at the end of the round
In Capsim, pricing standards are set by
the consumer, market segment
Repositioning moves a product on the Perceptual Map from its old location to a new one. When does the newlocation become active?
the day the r and d project completes
When plotting the segment locations for each round
the goal is to determine the ideal spot location for each segment during the 8 years.
In forecasting, it is not likely that you will take half of the sales unless
the price is at the low end of the range and the positioning, age and MTBF are superior.
If there are two identical products, one that has 100% accessibility and one that has 0% accessibility?
the product with 100% accessibility will outsell the other 2 to 1 providing all other attributes are identical
Which customer group or market segment seeks proven products using current technology?
traditional customers
After you have uploaded your decisions to the website, you can change your official decisions as many times as you want prior to the processing date and time of the round.
true
The preferred product perceived age for each sector peaks at:
zero years for high end, and seven years for low end
