Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

STRATEGIC MANAGEMENT FOR

COMPETITIVE ADVANTAGE

(A PROFESSIONAL BUSINESS SIMULATION REPORT

BASED ON THE EUROPEAN CAR INDUSTRY)

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

ASSIGNMENT

ON

STRATEGIC MANAGEMENT FOR

COMPETITIVE ADVANTAGE
(A Professional Business Simulation Report Based on the
European Car Industry)

Submitted

To

(Northumbria University)

Submitted

By
(Student Name.................................)

(Student ID.......................... Seminar Group Number............)

(Team Number....................Word Count........................)

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

Table of Contents
1. INTRODUCTION......................................................................................................................................... 4

2. BACKGROUND TO THE BUSINESS SIMULATION.......................................................................................... 6

3. BRANDING................................................................................................................................................ 8
4. SUMMARY OF PERFORMANCE OF BIS-ROUND-1 TO 4................................................................................9
4.1 ROUND 2 FINANCIAL INDICATOR ANALYSIS.........................................................................................................15
4.2 ROUND 3 FINANCIAL INDICATOR ANALYSIS.........................................................................................................15
4.3 ROUND 4 FINANCIAL INDICATOR ANALYSIS.........................................................................................................17
5. PRODUCTION.......................................................................................................................................... 18
6 PERSONNEL DECISIONS............................................................................................................................ 21
7. CRITICAL REFLECTION.............................................................................................................................. 22
8. FINANCE DECISIONS................................................................................................................................ 24
9. CONCLUSION.......................................................................................................................................... 25
10. TEAM PERFORMANCE & PERSONAL REFLECTION...................................................................................25
WORKS CITED............................................................................................................................................. 27
APPENDIXES-.............................................................................................................................................. 28
APPENDIXES-1 RATIO ANALYSIS FORMULAS................................................................................................ 28
Appendixes-2 Pictorial Summary of Ratio Analysis................................................................................................29

List of Tables
Table 1Predicted Production Report BIM..................................................................................5
Table 2Predicted Key Financials BIM.......................................................................................6
Table 3Bloom's Taxonomy - 6 level classification of objectives& skills..................................7
Table 4 Summary of Key Balances of BIM.............................................................................10
Table 5 P & L Account ROUND 1..........................................................................................10
Table 6 Profit and loss Round 1 and round 4 Comparison......................................................12
Table 7 P&L Round 4 - BIM...................................................................................................13
Table 8 Business Summary Round 4 -BIM.............................................................................15
Table 9Key Balances Round 4 - BIM......................................................................................15
Table 10 Round 2 Financial Indicators....................................................................................16
Table 11Financial Indicators Round 3.....................................................................................17
Table 13Financial Indicators Round 4 - BIM..........................................................................18
Table 14 Balance Sheet Round 4 - BIM..................................................................................18
Table 15 Production Report.....................................................................................................19

List of Figures
Figure 1Proposed 4 New Brands................................................................................................5
Figure 2Bloom's Taxonomy.......................................................................................................7
Figure 3 Branding of BIM..........................................................................................................9
Figure 4 Round 1 cost vs revenue............................................................................................12
Figure 5Difference of Hierarchy in Traditional and Agile organizations................................24

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

Figure 6 Expenses and Market Cost.........................................................................................26

1. Introduction

This business Simulation report prepared after a wide range of discussions in the game play
and come over the stage of preparative phase with a concept and preceded the team with
defined responsibilities for strategizing the proposed firm and it has a clear crystal blue print
for operational plan with defined goals with objectives to increase market dominance by 5%
and profit by 8% in the third year of business simulation plan execution.

The proposed firm performed discussions focused on European car market and decided to
enter in the market. The game group reviewed the European car market and decided to
change the car designs by considering the popularity factors, besides that reviewed the
change of option design based on popularity factor. In addition, discussed the market share
and relevant promotion strategies in the market and reviewed the productivity, sales, revenue
for each model that derived from the change option and popularity factor

In order to precede execution of action plan decided four new design brands focusing various
age groups with attractive service and warranty. (Fig.1)
Figure 1Proposed 4 New Brands

Source: Course Work Presentation (Part-A)

The production schedule (Table-1) shows market sector based model produced and sold with
models price and market scheme and the closing stock of the produced brands. In addition, it

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

shows the work force used, material cost, design and options, labour cost, gross margin
earned and warranty cost per unit of a car.

Table 1Predicted Production Report BIM

Table 2Predicted Key Financials BIM

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

Table 3Predicted Profit and

The predicted key financials for the proposed firm (Table-2) shows the market share, gross
profit, profit margin, total income, total sales and EBIT.

2. Background to the Business Simulation

This business sumulation is the imitation of the real world business, refers to (MBA Brief,
2021), imitating the operation and management of a real business process or the system or
a complete supply chain and here by the simulation group focused European car market and
throughout the management game focused to develop scenario based business
development to implement in real life. In this management game, team members
dyanamically acted with clear attention on strategic thinking, decision making, problem
solving, financial analysis, market analysis, operations, team work and team building,
creative thinking and leadership development.

Team members experienced (Celemi.com, 2021) the interactive learning also engaged in
the realistic business world with the opportunity to imitate reality, work on risk free
enviornment, developed and stimulated co-operation,learning by doing. The team members
particularly experienced the scenario based production, marketing, personnel and financtial
activities.

During the strategy game , the team members identified business opportunities and
business plan preparation, besides that they practices management execution and decision
making through key concepts of finance and business and management (Course.com,
2021). The strategy group analysed the Europian car market and find out the opportunities
exists there for capitalising (Course.com, 2021), such as using the proper analysis and
frame work, besides that used methodology for to select right product for the Europian car
market. The strategy group decided and proposed four models (Fig.1, Page-3), besides that,
used appropriate methodology to test the demand and market acceptability, further more the
strategy formulation considered the enviornment and competitive analysis.

During the strategy simulation section the Bloom’s Taxonomy let participants to visualize the
route map of how the strategy developed through various steps. Rrefers to (University of
Arkansa, 2021), Bloom’s Taxonomy presented as classification of various objectives and
skills that set for learners and it set to six levels and also helpful for structuring the learning
factors, lessons and assessments.

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Figure 2Bloom's Taxonomy

Source: (University of Arkansa, 2021)

Table 3Bloom's Taxonomy - 6 level classification of objectives& skills

1 Remenbering Retrieving, recognizing, and recalling relevant knowledge from long‐term memory.

2 Understanding Constructing meaning from oral, written, and graphic messages through
interpreting, exemplifying, classifying, summarizing, inferring, comparing, and
explaining.
3 Applying Carrying out or using a procedure for executing, or implementing.
4 Analysing Analyzing: Breaking material into constituent parts, determining how the parts
relate to one another and to an overall structure or purpose through differentiating,
organizing, and attributing.
5 Evaluating Making judgments based on criteria and standards through checking and critiquing

6 Creating Creating: Putting elements together to form a coherent or functional whole;

reorganizing elements into a new pattern or structure through generating,

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

planning, or producing.

3. Branding
Under these circumstances, the strategy game players decided to brand the products and
name for facilitating product differentiation, because in markets, there is war between brands
not with companies (Article Library, 2021). In addition, Kotler and Amstrong defined brand,
as quoted in (Article Library, 2021), “brand is a name, term, sign, symbol or a combination
of these that identifies the maker or seller of product or services” . But branding defined by
Kotler & Keller 2015, quoted by (Branding Journal, 2021), “Branding is endowing products
and services with the power of a brand”.

Figure 3 Branding of BIM

Source: Course work Presentation – Part -A

In order to register the brand name and image, the business simulation team members
established a company for incorporation on 4 th March 2021 with a brand image (Fig.2) and
name “BIM”, such as “Bisiness with International Management Ltd” and the company
managed and directed by ten executive board members with different functional areas’ head
of directors, like Managing director and other director heads of commercial strategy,HR,
operations,finance, protocol, safety and security, engineering, sales, revanue and marketing.

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

The company standards, core values and goals are specifically defined and it is the
funndementals of the organization, besides that, these are the guiding principles that dictate
behaviour and help to identify the right and wrong, in addition, that helps organizations to
decide whether the company is in right path and attaining objectives or not(Your Dictionary,
2021)

Vision : “World’s most trusted company designing “SMART” Automobiles for “SMART”
World”

Mission: “Attract and retain customers by unique and innovation experience with high valued
products and services”.

Objectives: “Achieve market dominance by 5% and profit by 8% in the third year of

operations”.

4. Summary of Performance of BIS-Round-1 to 4

The table-4 represents the key balances of proposed car manufacturing company (BIM)
focusing European car market.

Table 4 Summary of Key Balances of BIM

Particulars Round - 1 Round 2 Round 3 Round 4

Total Sales 1654.43 3163.81 3491.75 5752.74
Total Unsold Stock 00.00 6.70 456.77 739.33
Shareholders Fund 482.16 702.13 872.27 1363.51
Closing Bank Balance 437.47 431.85 211.26 739.33

Out Standing Loan 600.00 381.27 965.34 859.71

The summary of key balance from all rounds shows a healthy trend, such as the sales revenue
showing increasing trend and it increased about double to the second round and in third round
also shows a favourable change and final stage there is an increase of 64.75% from round3.

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

The stock level in round 2 was very low and after it level 3 and level 4 increased the
production capacity to meet the high demands.

The shareholders fund increased 182.79% from round 1 to round 4. That is also an indicator
of growth. The bank balance shows sufficient balances for to meet current liabilities. The
outstanding loan from round 1 was 600m and it reduced due to repayment prior to start mass
production. When increased production the loan again increased and this variation depends
the production.
Table 5 P & L Account ROUND 1

The profit and loss account (Table 5) of BIM for Round 1shows a 1654.43 m and cost of
goods sold is 1176.37 m. the cost of goods sold is 71.10% of total sales. If the percentage of
cost of goods sold reduces, then the gross profit increases. The gross profit is 478.06m and it
is 28.90% of total sales.

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

If the factors of production, such as material, labour and factory overheads if reduced,
likewise, raw materials can buy in bulk and get discount or switch supplier for favorable
terms, more over substitute materials can use without compromising quality. The skill of
labors and production are dependable and if the labors need more training it can provide. If
there is requirement of highly technical people provide it or hire technical people and train on
the job. The mechanization or automation of each single production unit can automate and it
brings revolutionary changes and the cost of production will decrease.

The total of overhead expenses is a sum of 495.91 m and it is 29.97% of the total sales.
Controlling the overheads means increasing the profit, here the promotion expenses 94 m and
it made a 5.68% of the total sales. The promotion expense is for long term and the effect of it
remains for many years, therefore it has to capitalized and apportioned to number of financial
years. Research and development expenses are 104.15m and it is 6.30% of the total sales. It is
also have a long-term effect and it has to capitalized and apportioned to number of financial
years.

The round one shows a net loss of 17.85 million, it is 1.08% of total sales. The both research
and development and promotion expenses were capitalized and adjusted the company shows
a net profit. Technically, in round one the company made profit.
Figure 4 Round 1 cost vs revenue

Source: Executive – Simulation Platform

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

Table 6 Profit and loss Round 1 and round 4 Comparison

Source: Prepared from Simulation data

The comparison between Round 1 and Round 4 profit and loss account of BIM shows a
248% increase in sales revenue.(1645.43 vs 4098.31). The cost of goods sold increased 258%
(1176.37 vs 3031.69), besides that the gross profit increased 223% (478.06 vs 1066.62). The
promotion expenses were decreased by -4%, because the promotion were conducted only at
first and second rounds. The research and development decreased by -78% in fourth round,
because it achieved the objectives and stopped. Interest expenses reduced -0.22%, when
revenue generated the bank loan partially and reduced the burden of interest. The total
expenses were increased 112% when it comparing ROUND 1 and Round 4.

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

Table 7 P&L Round 4 - BIM

The round 4 profit and loss account shows cost of goods sold 73.15% of total revenue and
gross profit 26.85% of total revenue. Such as when one pound of sales costs o.73 pence cost
and 0.27 pence gross profit. The total overhead expenses are 18.31% of total sales revenue
and net income 8.54% of total sales (Table-7).

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

Table 8 Business Summary Round 4 -BIM

The ratio analysis is important to understand the financial health of an organization. The
current ratio (current assets / current liabilities) is 2.23, such as the company have pound 2.23
for every one pound it owes.

Table 9Key Balances Round 4 - BIM

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

Table 9 shows the operational balances and key balances.

4.1 Round 2 Financial Indicator Analysis

The Round 2 financial indicators showing an outstanding debt 381.27 million and the return
on Asset Ratio ( Net Profit/Total Assets is 20.30%, besides that, Current Ratio (Current
Assets – Current Liability) is 1.89, such as for one pound liability, there is 1.89 asset for
payment in the company. The Gross Margin (Gross Profit/Sales) 27.41% and Quick Ratio
(Current Assets-Inventory/Current Liabilities) is 1.87. The Post Tax Profit (Profit After
Tax/Total Sales) is 1.04%. The profit divided by number of employees shows per head pound
69,246.53. The Return on Share Holders Fund (Earning After Tax/Total Share Holders
Equity) shows 32.33 %.( Table.10).
Table 10 Round 2 Financial Indicators

4.2 Round 3 Financial Indicator Analysis

The outstanding debt of the company increased to 965.34 m in round 3 and comparing to the
round 2 the outstanding debt was 381.27 million. The return on asset ratio in round 2 was
20.30% and it reduced by 9.26%. The current ratio in round 2 was 1.89 and it increased to
2.04. The gross margin in round 2 was 27.41% and in round 3 it is 25.67%. The quick ratio in
round 2 was 1.87 and in round 3 is 1.15.

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

The post-tax profit was 6.95 in round 2 and in round 3 it is 4.87. The liquidity ratio in round 2
was 1.04% and in round 3 it is 0.41. The round 2 profit divided by number of employees was
£ 69,246.53 and in round 3 it is £27,265.29 and lastly the return on shareholders fund in
round 2 was 31.33% and in round 3 it is 19,50.(Table 11 )

Round 3 Discussions

The comparison of various financial indicators of round 2 and round 3 shows the fall and
based on the ratio analysis there is fall in growth, profitability, activity, liquidity as well as
solvency ratios. In addition, the round 3 sales was 3491.75 and it was about 50% increase
from round 2 (1654.43 vs 3163.81). The increase of sales of round 3 is very low when
comparing to round 2 (3163.81 vs 3491.75).

The unsold stock was 456.77 units (including work in progress) and it was a high stock in
round 3 comparing with previous rounds. There is an increase of shareholders fund from
round2 (702.13) to round 3 (872.27). The closing bank balance reduced to 211, 26 from
round 2 pound 431.85. The outstanding loan increased from round 2 (381.27) to round 3
(965.34) (Tble.4).

The round 3 made a net profit of 170.14 million, but the net profit of round 2 was 219.97.
Therefore, the round 3 was the most stressful and full of decision making period for to
manage the finance and production.
Table 11Financial Indicators Round 3

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

4.3 Round 4 Financial Indicator Analysis

The income statement of round 4 (Table-7) already discussed and a comparison made
between round 1 and round 4 (Table-6)
Table 12Financial Indicators Round 4 - BIM

The round 4 financial indicators improved better as compared with previous rounds.

Table 13 Balance Sheet Round 4 - BIM

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

The balance sheet constructed based on the formula, Assets = Liabilities + Owners Equity, in
other hand, Owners Equity = Assets – Liabilities. The balance sheet provides the financial
health of the company. In common the analysts prefer a ratio 1:5 to 2 or more is an adequate
ratio. The balance sheet discloses the liquidity or the capacity to pay cash on liabilities. The
ratio analysis based on the ratio (Appendix-1) will provide to wide range of financial ratios
(Appendix-2)

5. PRODUCTION

The proposed car products (Fig-1) are Medium Car (M-21), design SUV 4x4 small petrol
engine targeting age groups 25 – 40. The second is a small car (S-21), design 3/5 door
hatchback/small petrol engine targeting age group under 25 years. The third car is a luxury
car (L-22), design 2/3 door coupe/alternative fuel engine targeting age group 41-55 and fifth
model is large car (L-23), design SUV 4x4/large petrol engine targeting the age group 41-55
and all are with service and warranty.

Table 14 Production Report

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

Source: Simulation Platform

The round two predicted production report shows that, in market sector-6 Model- M-21
produced 62760 units, and sold all the units with price 23, 748 and achieved market share
1.29%.

Market sector -1, Model S-21 produced 65,749 and sold 65,163 and balance in stock 586
units and the price is 16,765.06 and achieved a market share 1.26%.

Market sector 12, Model L-22 produced 8964 units, sold out with unit price 64, 802, and
achieved market share.1.55 percentage.
Discussion
The small model car S-21 targeting age group under 25 did not sold out all the produced
units, the closing stock is 586 units and remedial actions to be taken to sale the produced
units and future production.

The medium model M-21 car sold out all the produced units, therefore to increase the
productivity, besides that L-22 model also sold out all produced units, therefore, focus on

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

production requirements is essential by focusing to reducing cost of production in factors of

production.

Market sector 6, Model M-21 used work force 1500 and occurred material cost 12,813.15,
designs and options cost 3819.22, labour cost 699.09 and achieved a gross profit margin
27.02% and productivity 41.84%.

Market sector 1, model S-21 used 5000 work force, material cost 9272.98, design and option
cost 1493.73 and labour cost 667.31. the gross margin achieved 31,80% and productivity
43.83%.

Market sector 12, model L-22 used work force 1000, material cost 37,724.18, design and
option cost 10,737.84, and labour cost 3263.05 and gained gross margin 20.18 and
productivity 8.96.

Discussion
The model M-21 contributed a 27.02% of gross margin and productivity ratio 41.84. the
productivity ratio is low performance comparing to industry standards or 70% rule. The gross
profit margin has also improved or alternative changes by work force re-arrangements,
material cost reduction by alternate or substitute, bulk purchase and get discounts,
automation of different individual unit of works or outsourcing.

Model S-21 contributed 31.80% of gross margin and shows productivity 43.83%, such as the
productivity is away from industry standards. The closing stock of S-21 remains 586 units,
therefore focus required for increase productivity and pricing strategy re-arrangements other
factors that affected the sales of model S-21

Model L-22 contributed gross margin 20.18% and productivity 8.96 %. The productivity is
very poor, therefore remedial steps to correct, such as alternative choices likewise
outsourcing, employee hire and provide training or any methods that reduces cost of goods
sold and increase productivity.

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Target Production

Market sector 6-M-21 targeted to produce 63,000 units production capacity per year with
productivity 35.15% and it increased by 42.18% with warranty and price per car 519.76.

Market sector 1 – Model S-21 targeted to produce 66, 000 units with productivity units per
year 36.82% and potential productivity with overtime 44.19% with warranty cost 336.46

Market sector 12- Model- L-22 targeted to produce 9000 units with potential productivity rate
7.53 % with overtime 9.04% and warranty 1473.23

Discussion
Model M-21 sold out all products and gain a market share 1,29% and gross margin
contribution 27.02% and productivity 41.84%, but increasing the productivity to 42.18% on
the this circumstances affect the cost of goods sold, therefore prior to increase the
production, remedial steps suggested remedial steps should be considered and to be in
action.

Model S-21 remained stock 586 units and productivity was 43.03%, but before increasing
production required to analyze price strategy, marketing strategy, cost of goods sold as well
as production strategy for Model S-21

Model L-22 achieved market share 1.55% and contributed gross margin 20.18% and
productivity 8.96%, but prior to increase production to 9.04%, it has to be analyzed the
factors that increases the cost of production.

To conclude this section, the factors of production and production process has to be analyze
for reduce the cost of goods sold, such as: -
1. Material can buy in bulk and get discount or alternative supplier sources or substitute
to low cost material
2. Labors to be trained or new labour for training and working
3. Production process can automated or outsourced
4. Overheads to be managed
5. Price strategy fixed according to new production strategy.

6 PERSONNEL DECISIONS

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

Refers to (gisma.com, 2021), Human Resource Management defines as; “the effective
management of people in an organization. HR management helps bridge the gap between
employees’ performance and the organization’s strategic objectives. Moreover, an efficient
HR management team can give firms an edge over their competition”.

The HR planning is essential to business organizations, because HR is the precious factor in

an organization and HR is working for to achieve the strategic objectives of the organization.
Therefore planning HR for future shortage or excess HR in the organization The HR
planning and action helps to develop talented work force and it is essential part for to face
the challenges that arise from the modernization, re-structuring or re-engineering.

The organization required right person for to realize the objectives and right number of HR in
right job and the HR should be strategically fit. The proper planning of HR reduces the costs
and it determines the future skill requirements. Moreover it plans careers for individual
employees and provides right view of HR dimensions to the higher management and can
positively provide required training and development to the HR.

The HR Recruiting and training will be completed prior to fourth year of operations and total
of 8000 employees in the end of fourth year, the total salaries and wages estimated as
pound 185,600,000 for fourth year and it is an 1% increase from the last year.

Operational training should be provided by team members in each area of operation

likewise, commercial strategy, HRM, operations, finance, protocol, safety and security,
engineering, sales and marketing, management and revenue. The training budget estimated
£3,712,000.

7. CRITICAL REFLECTION

This critical reflection section explains how the strategic simulation team used the financial,
marketing, operations and human resource learning materials connecting with the strategy

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simulation game and how the team used it for responsible business decisions that affect
internal and external stake holders group to the organization.

The strategy team engaged in the decision making process as a dynamic team in the
strategy simulation process and brain storms the European car market with materials
provided as well as independent and group research, besides that used a range of business
skills that includes finance, marketing strategy, more over familiarized with interpretation of
information, negotiation, time management and presentation skills.

The simulation section disclosed the strength of a team and it shows the requirement of
effective team building. The team were working in a live market place and it provided an
opportunity to explore and experiment it for evaluate knowledge acquired, decision making
power and judgement.

Stakeholders can be an individual or a group and they have a personal stake in the business
and it will be a business owner, investors, shareholders, suppliers, buyers, employee,
customer or people in the local community in the surrounding of the organization which
operates. The stakeholders can pressure the business for making changes or to attend any
specific problems that the business connected with. (AZ Central, 2021)

The pressure groups can influence some aspects of how the organization operates and
what types of product it manufacture and these pressure groups are formed for a particular
issue that affects the society or against the ethical issues.

The business stakeholder’s analysis helps to identify the influence group have impact on
the success of an organization and stakeholder analysis helps to know the attitude and
evidence wants of various stakeholders, therefore it helps to make a communication
program and it let maintain optimistic relations with the vital groups. (AZ Central, 2021)

Refers to (Villanova University, 2020), there is only change is constant in the business and
it is true in market capitalism or globalized market enviornment. The rapid changes that
occurred in the technology and the capability of an organization to adopt that changed
technology is fundemental for success.

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As quoted in (Villanova University, 2020), in a thought leadership report by the Project

Management Institute (PMI) titled “Achieving Greater Agility – The vital role of culture and
commitment”. Argues that, the vital factor that influence the project success rates is the agility level
of an organization and it is more vital than project approach, such as when greater the agility, then
better outcomes of financial results, customer satisfaction, project metrics, strategy implementation
and realization of benefits.

Figure 5Difference of Hierarchy in Traditional and Agile organizations

Source: (Yitmen, 2018)

The strategy simulation team worked as an agile focused team or being acted acted as
stakeholders of an agile company, such as agile companies adopt swift changes , but the
existing traditional companies to achieve agility is more difficult due to the traditional
structure that it followed. But here the team knows that agility is the capacity to adopt new
changes or conditions quickly and changes the direction.

The strategy simulation members build a team based structure and combined various
competencies and focused on delivery and value, besides that collobaration based and team
work emphasized. The team members were servant leaders and they focused on service,
besides that focused on productivity and value , more over always rolling wave and adaptive
planning. The strategy simulation group stands for think big and start small. They evolved
continuously with radical transperancy and decisions driven by data. The empowered team
based on experimentation and learning from defaults and formulated the organizational
structure that changes shapes in line with the new and relevant strategies. The strategy
simulation team focused on team based performance within the scope of decided objectives
and a policy to stands with employees and customer oriented. The strategy simulation team

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during the simulation process used the material for taking crucial decisions on financial
matters, marketing strategies, operations management and human resource management.

8. FINANCE DECISIONS
The new car manufacturing company raised £ 500 M as equity capital and the rest of source
of fund was bank loan for the preliminary expenses for the startup. The overdraft facilities to
be discuss with banks, besides that additional capital to rise and the source supposed to be
from private investors and has to summit and discuss the business plan with selected
business investors. The investors get a minimum of guaranteed 5% confirmed ROI within the
first 3 years of operation. The loan repayment should be discussing with bank prior to ending
of the moratorium period allowed by the bank for startups and interest rates applicable to
standard business loan rates.

The further investment decisions have to discuss with team members and already invested
for research and development, employee training and capital investment for factory and fixed
assets set up for factory production equipment. In addition, budget for initial investments
(Fig.5) for market research, market perception report, data on competition, automation,
training skills, advertising on Television and digital media as well as promotional offers of a
total £ 136, 912, 000.
Figure 6 Expenses and Market Cost

Source - Course work Presentation Part-A

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

Buying assets to be discuss with team members after finalization of production schedule and
outsourcing decisions if any. Fixed overhead will fix after the decisions from various
department heads of the team. Tax will be paid and standard rates applicable after
exemptions for the startups.

9. Conclusion

The strategy management for competitive advantage deals to prepare a business simulation
report based on the European car market, for that background study done and decided
branding new cars. During the simulation, process, team members goes through various
decisions making likewise, financial decision, the market where to sold, technical
specifications, cost and prices, work force, production and marketing. The team succeeded
for the strategy development and implementation for the competitive advantage as well
attaining the objectives.

10. Team Performance & Personal Reflection

During the business simulation the team members as a whole and individually take effort to
done the background study of the European car industry and engaged the strategical decision
making process for the four rounds in the business simulation process. The team work
motivated and helped for align the objectives, developed HR, worked for to achieve the
objectives, besides that used HR wisely for better results. Throughout the business simulation
with team members engaged for business plan and performance goals, in addition, focused on
production, sales, service, profits and productivity. Moreover, engaged for performance
appraisal discussions regarding the past rewards, present performance review and future
development reviews.

The team was prepared to communicate with people like managers and employees. The team
engaged in appraisals and it benefited to improve the employee performance, control over
work, better motivation and commitment, in addition, better relationship and information
flow. As a stakeholder and key manager in the business, the team and individual members
targeted objectives with other employees, motivated them with rewards for better job
performance, and offered right feedback. As a strategic manager point of view, translated
business goals to individual work objectives with standards, monitored the performance and

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

communicated with enquired agreement on the objectives. Furthermore, trained employees to

attain their performance objectives during on work, identified the employee strengths and
weaknesses and generated development plans for both individual and organizational needs.

During the simulation process, the team members were information providers, encouraging,
advising, clarifying problems, questing, seeking agreements and summarizing the new ideas
and knowledge. The team members were focus on collective contributions, leadership
emerged from set of shared values, and there were accountability for individuals and group.
The performances were contributing by sum of individuals and there is high-level interaction
throughout the simulation.

The strategy simulation team analyzed the present situation of the proposed firm and decided
to where landed and how to reach there to avail the objectives, therefore brainstormed and
researched the market condition, latest technologies, legal and political conditions,
competitors and located new opportunities and enquired customer needs. The strategy process
set the directions, focuses on efforts, defined the organization and provided consistency. The
team members were innovative and they were setting the vision and ready to take risk and
responsive to the problems. Finally, the team started the operations with four round
operations and succeeded to the implementation and execution of the vision, mission and
fixed objectives.

As a team member in the simulation, personal experience were helped me to develop myself
as a leader manager. During the simulation research and data collection were conducted in
European car industry and learned lessons from team and members, instructors and
understand the power of collaboration with team work, besides that, understand how it
develop leader managers and how differ the leadership and management. The simulation
leads through the routes of strategy from vision, mission and planned objectives, besides that
it make one aware about where is now and where want to go and how reach there.

The decision making areas of executing the strategy plan includes, research and development,
production, design, market research, financial decisions, analysis of financial statements like
income statement, balance sheet and cash flow statements. In summary, the business
simulation developed this author as a leader manager and build confidence to do as a CEO in
any global organizations in future.

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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

Works Cited
1. Article Library, 2021. yourarticle library.com. [Online]
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[Accessed 28 April 2021].
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28276.html
[Accessed 5 May 2021].
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analyst.html
[Accessed 7 May 2021].
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definition/#:~:text=%E2%80%9CBranding%20is%20endowing%20products
%20and,a%20brand%20in%20consumers'%20minds.
[Accessed 28 April 2021].
5. Celemi.com, 2021. celemi.com. [Online]
Available at: https://celemi.com/business-simulations/what-is-a-business-simulation/
[Accessed 21 April 2021].
6. Course.com, 2021. course.com. [Online]
Available at: https://www.courses.com.ph/senior-high-school-specialized-subject-
business-enterprise-simulation/
[Accessed 17 April 2021].
7. gisma.com, 2021. gisma.com. [Online]
Available at: https://www.gisma.com/blog/the-importance-of-human-resource-
management#:~:text=HRM%20can%20be%20defined%20as,an%20edge%20over
%20their%20competition.
[Accessed 5 May 2021].
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Available at: https://www.mbabrief.com/what_is_business_simulation.asp
[Accessed 21 April 2021].
9. Procure Ability, 2021. procureability.com. [Online]
Available at: https://procureability.com/supplier-financial-analysis-for-procure
[Accessed 23 May 2021].
10. University of Arkansa, 2021. tips.uark.edu. [Online]
Available at: https://tips.uark.edu/using-blooms-taxonomy/
[Accessed 7 May 2021].
11. Villanova University, 2020. villanovau.com. [Online]
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critical-success-modern-business/
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Module Code: NX0474, Assignment-B, Strategic Management for Competitive Advantage, Northumbria University

Appendixes-

Appendixes-1 Ratio Analysis formulas

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Source: (Procure Ability, 2021)

Appendixes-2 Pictorial Summary of Ratio Analysis

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