CAPSIM Objectives

If you are undergoing the CAPSIM simulation, this post is specifically for you!!!

I just want to share with you some the key objectives you will need to reach to be successful in the simulation. Obviously, the goal of the simulation itself is to teach you how to create a winning strategy. I wont help you with that here. I would not want to steal any of your fun away. Rather, I will list the key metrics you need to meet while crafting your winning strategy.

In essence, I will summarize a few key points that are listed in greater detail in the CAPSIM users guide. If any additional information is needed, just leave me a comment and I will be sure to get back to you.

Here is what we will need to do:

1. We are trying to gain an increasingly larger amount of market share every round. Since there are five teams, we will all start out with 16.67% out of 100%. Capstone>Page 1 (if you have four teams, each will start with 20% market share)

2. We need to keep our contribution margin above 30%. Proformas>Income Statement. This shows that we are keeping costs down and operating efficiently as we increase our market share. Anything below 30% costs us major points on the final grade.

3.  Have the highest profit possible for each product. Proformas>Income Statement.

4. Have a positive projected cash position. Finance tab. If we do not have a positive cash flow, CAPSIM will automatically take out a loan from “Big Al” to pay for our outstanding debt. Al charges really high interest and we lose big points on the final grade.

5. Have no more than two months inventory on hand at the end of the year, and NO stock outs. Stock outs costs us BIG money!! Excess inventory costs us money too, but not as much as a stock out. Capstone>Page 4>Unit inventory

6. Meet, to the best of our ability, all customer buying criteria based on % of importance. Capstone>Pages 5-9>Customer Buying Criteria in the top left hand corner.

7. Invest in plant capacity and automation to keep our ability to produce up to par throughout all six rounds.

That is all I have time for at the moment. If there is interest generated on the topic, I will be glad to go into further detail. I wish you all good fortune in your efforts!!!!

-Strength of GIF

PS, here is some additional information on how to do your promotional budget: http://www.youtube.com/watch?v=d7is7eXFOT0