Market analysis of Stratsim management simulations

StratSim direction simulations are online games pioneered by Michael Deighan and Stuart W.James from Virginia USA aimed at giving pupils a wider exposure in the existent universe concern sphere. The instigators perceived pupils to see the simulations as a ‘unique larning event ‘ where the cognition gained so far within the academic old ages could be now made into patterns.

Quintessentially, apart from being a acquisition experience it was anticipated to convey a challenge to both directors and executives. Harmonizing to the instance, ‘This is far easier to state than to accomplish. ‘

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1.1. Industry Overview

StratSim direction simulation was a game-like, all about different houses runing in an car industry whose directors compete to the maximal by puting ends and aims that are intended to overreach its immediate and within industry rivals. The directors used attempts to the best of their abilities so as to guarantee right determinations are put frontward merely to gain brilliant net incomes due to greater gross revenues ascribed by the direction.

Wholly, throughout the simulations there had been a entire figure of seven ( 7 ) houses runing from houses A, B, C, D, E, F A and G. The initial alphabets of each house meant that its several vehicles began with either of them from A until G. All these houses had a similar get downing point to get down its operations including financess.

Among the houses, the best 1 was to be judged on public presentation bases chiefly in footings of market portion, market value, income generated every bit good as efficiency in playing with the selling tools i.e. selling mix ( 4 P ‘s ) .

1.2. Firms Overview

Firm F was a group formed by four members who are Raya Nassor, Sarah Alley, Shahista Hasmani and I, the writer of this study. Firm F comprised of three ( 3 ) vehicles which were Fantasy, Fast and Fish while their categories were Family, Truck and Economy severally.

I worked hand-in-hand with my co-workers in doing the best determinations for our houses ‘ endurance in an ocean of high moving ridges of competition. The houses ‘ extreme purpose was to place itself as a market leader by come ining new markets and run intoing the demands and desires of clients through vehicle properties.

However, there was a category which was n’t served by about all the rival houses. It was known as AEV which must be addressed as engineering modern with incorporate selling attempts. Equally far as Firm F is concerned, my co-workers and I decided non to choose for it as our house was acute plenty on cost minimization and non spend-alls of resources.

2.0. Mission and Vision

Mission Statement

‘Mission statement aims to supply employees and stakeholders with lucidity about the overall intent and raison d’etre of the administration. ‘ ( Johnson et al 2009, p.112 )

Harmonizing to Peter Drucker ( male parent of modern direction ) , ‘what is our concern? ‘ is all about its mission. It is besides known as ‘creed of statement ‘ .

Firm F ‘s statement of intent could be:

“ To turn to different consumer sections desires through value creative activity with regard to their fiscal capableness when it comes to cars and finally ending-up with huge net incomes generated from gross revenues ” .

Vision Statement

‘A vision statement is concerned with what the administration aspires to be. Its intent is to put out a position of the hereafter so as to enthuse, derive committedness and stretch public presentation. ‘ ( Johnson et al 2009, p.112 )

Therefore, house F ‘s dream is as follows:

“ To be a company ‘of the people ‘ , ‘for the people ‘ and ‘by the people ‘ in the car industry. ”

3.0. External and Internal Analysis

These are the models used to transport out an analysis of an administration ‘s advancement by analyzing two major extremes, the inner ( internal ) every bit good as the outer ( external ) environments.


‘The PESTEL model categorises environmental influences into six chief types: political, economic, societal, technological, environmental and legal. ‘ ( Johnson et al 2009, p.25 )

The external environment is much more complex than internal because the earlier could exercise tremendous force per unit area to tauten F to the extent of finding its ways to transport on its operations. Now allow me analyze all the six factors while reflecting house F.


This refers to the functions played by the authorities together with the grade of states stableness which will act upon production of the motor vehicles for house F to travel on or slowdown behind. Besides, this factor will find whether the house is undermined by a peculiar set of limitations in its concern such as non fabricating vehicles which are similar to those possessed by the authorities.

Throughout my analysis, all the houses including house F were runing in a peaceable environment for the undermentioned grounds:

Firms were progressively believing on merchandise development and farther production.

Assorted client classs continued to purchase cars of their desire as they did non doubt the political state of affairs in their countries.

Addition in the figure of traders in all the extremes of a compass way.


Within the class of the game, the concern rhythm was n’t predictable due to the fact that pricing constructions employed by the car houses was different to one another.

Firm F and other were aggressive towards increasing the trader price reduction rates believing that it would hike its motor vehicle gross revenues and therefore increase its profitableness.

However, the economic system of the houses runing in the simulation kept on deteriorating with mention to the get downing market portions, market values, stock monetary value and overall net income. At the terminal, economic systems were severely shaped.


This refers to the society in which the houses are runing their car concern. Within the society, people differ in civilization and human ecology. Some had been sing others as their point of mention in purchasing certain autos.

Besides, it ‘s obvious that as there are many automobile houses means more vehicles down the roads and therefore more traffic hits to the extent of detaining people planned activities during the twenty-four hours.


Promotion in engineering was restricted among the houses as there were maximal restrictions of technological capablenesss in interior, styling, safety and quality extremes for which non a individual house could transcend.

Above all, the houses were given an chance to do developments and selling for a new category i.e. AEV which at the start had no introduced vehicle. The AEV being technology-driven, it is possible that it could utilize electricity, gas or other agencies. From my narrow position, I perceive AEV development to be more hazardous.


Here I ‘m greatly concerned because while vehicles are developed who knows how the waste stuffs are damped. This may hold greatly deteriorated the dirt and the species suppressing in and on. These vehicles emit ‘green house gases ‘ which add more wellness concerns to its ain users through pollution after the fuel has been burnt in the engines.


It is up to the authorities to do certain that, a house which goes against the labour Torahs, wellness and safety ordinances, environmental saving and trade patterns are debarred from operating in the car industry.

The authorities should ordain Torahs which limit the figure of vehicles to be owned by a individual individual unless it is large company with big operations in-order to understate pollution on air, land and H2O beginnings.

3.2. Porter ‘s Five Forces Model

Harmonizing to Michael Porter, there are five cut-throat forces that demonstrate the regulations of competition within the car industry and which determine both industry attraction and the grade of profitableness. These forces are:

Menace of new Entrants

Throughout my analysis, I realised that for a house to come in into car industry is non that much easy due to the grounds that, excessively much investing financess will be required to hold a successful get downing point as a affair of fact it ‘s non all about bring forthing but cognizing the demands of the market through Research and Development ( R & A ; D ) which costs greatly.

For late movers, basking economic systems of graduated table will be extremely minimum because there are giants already runing in big graduated tables. Some of the giants may hold done either backward or forward integrating which may deflect new entrants.

Hence, the menace of new entrants in the car industry is low but houses need to be excess careful as the universe is dynamic.

Menace of Substitutes

There are plentifulness of replacements to vehicles but it does n’t intend people will switch towards them i.e. bikes, scooters and walking. I do n’t anticipate people to abandon cars due to increasing costs alternatively people will switch to more economical 1s from epicurean.

Hence, the menace of replacements is medium.

Dickering power of Suppliers

Suppliers ‘ grade of power is low due to the being of a large figure of constituents and parts distributers in the car industry. It is likely for a maker to exchange from one provider to the other. On the other side, houses at StartSim are likely to bask low monetary values of constituents because providers are many.

Dickering power of Buyers

In the StratSim universe, this is high as clients are likely to voyage from one maker to another if their demands and desires are non good addressed sing the fact that, there are about seven ( 7 ) houses runing in cars.

Reluctantly, houses will be forced to lodge on clients ‘ determinations on the demands, pricing and other vehicle properties. Customers are the nucleus and a major ground for the houses ‘ being.

Rivalry Intensity

This is really high because of the presence of many houses including house F runing in the cars. These houses used assorted concern schemes which have got differing effects to the competition strength. Hence, the grades of profitableness and market portions will differ at big.


This is a model used to analyze internal and external environment.

Strengths ( Internal )

Firm F ‘s names of its motor vehicles were alone i.e. Fantasy, Fast and Fish which could n’t be easy imitated by its challengers.

Failings ( Internal )

Mismanagement of stocks which had a greater autumn in value together with more stock list yearss.

Failure to do proper usage of the selling tools i.e. publicities and monetary values.

Firm F ‘s merchandise ranges did n’t vie efficaciously with those of its rivals.

Opportunities ( External )

The AEV category vehicles could be a platform for house F to maximize its market portion and gross revenues growing.

Poor public presentation in other houses could let steadfast F to derive more clients who could n’t profit from the earlier houses.

Traveling into markets which were non served before through market and merchandise development.

Menaces ( External )

Continuous technological developments for which house F could n’t get by.

Global economic recessions ensuing to fall in currencies and decelerating vehicles demands.

Car industry being competitory, steadfast F ‘s employees may hold been head-hunted by other rival houses taking traveling off the company secrets.

4.0. Strategic Planing

‘Strategy is the way and range of an administration over the long term, which achieves advantage in a changing environment through its constellation of resources and competencies with the purpose of carry throughing stakeholder outlooks. ‘ ( Johnson et al 2009, p.3 )

Planing refers to doing determinations on which strategic picks to transport frontward in the class of the concern.

4.1. Basic Scheme

Firm F ‘s long term scheme is to offer vehicles with the lower possible investings but in maximal Numberss with the purpose of increasing the net cumulative income and market portion from period 1 until period 4 with much focal point on the Family category.

4.2. Technology

Firm F thought that to travel hand-in-hand with progressing engineering as non necessary because it could take it off from high profitableness. Alternatively minor ascents in the vehicle properties are considered. Technology will be used to understate wastage so as to increase productiveness.

4.3. Financial Control

The direction of house F aspires to hold huge gross revenues and increasing profitableness but at same clip commanding Research & A ; Development as it wo n’t wish to pass a batch for it. It looks frontward to increase assets held while diminishing liabilities including debts.

4.4. Selling

Firm F intend to make consciousness to both society and potency clients through advertizements and publicities. Besides, attempts will be done to reexamine pricing constructions and the vehicles with related merchandises to be of value to clients. Distribution points will be monitored excessively.

4.5. Future Development

The direction of house F looks frontward to make major ascents in its motor vehicles if the degree of profitableness will allow it to make so. Otherwise, the sort of development which is expected could be maximizing of the houses ‘ works production capacity.

5.0. Lesson I learnt from simulation exercising

I came with a mentality that a houses ‘ market portion could be reciprocally relative to net cumulative income. Besides, it was n’t a good thought at times to discourse with members from rival groups as my group was at last determination mislead by another group taking to its low income and stock monetary value excessively.

Teamwork is the kernel towards accomplishing success as determinations were jointly made by group members who differed in cognition, background and experience.

6.0. Decision

To me, it was much moneymaking due to the fact that I had been exposed from theoretical to practical because the simulations made me believe outside the box as to whether the schemes I took portion in could overreach rivals.

Finally, I agree that a concern without scheme wo n’t hold a way.


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