BUSN 460

Team Erie: Capstone Final Paper

Vice Presidents & CEOs

Erin Straight
Ramiro Valdivieso
Tracy Wahl
Samantha Walston

February 29, 2020

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Table of Contents

Executive Summary...................................................................................................................................2

Company Organization.............................................................................................................................3

Competition................................................................................................................................................4

 Marketing........................................................................................................................................5
 Production......................................................................................................................................5
Industry Analysis.......................................................................................................................................7

Detailed Results.........................................................................................................................................7

Strategic Recommendations.....................................................................................................................8

Team Charter Assessment........................................................................................................................9

Team Effectiveness..................................................................................................................................11

Team Charter Assessment......................................................................................................................12

Conclusion................................................................................................................................................13

References................................................................................................................................................14
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Executive Summary

Team Erie emerged into sensor technology industry eight years ago, and we continue to prove to

our consumers and our competitors that we have earned our place in the market. We have a

strong executive leadership that has a vast understanding about the competition and the market.

This in turn, allows our company to make decisions and changes within production and strategy

to ensure the plans are executed precisely and planning contains structure and order.

The first product that our team introduced was Eat, a low-tech sensor technology that was

competitively priced and maintained a new model every 2-3 years. This was important to our

high-tech customers that also purchased the product due to competitive pricing. We are number

one in customer accessibility and customer awareness, because we did not hold back on our sales

and promotional budgets. We are confident in the product and therefore, our consumers need to

know about it. As we continued to make the right decisions throughout the years, Team Erie

dominated the low-tech market, taking nearly 45% of the market share. Team Erie’s Income

Statement and our ability to handle finances is an area of the company that we are not modest

about. Our team has taken the lead in Sales at $224,156, a staggering 21% more than the next

runner up. No emergency loan bailouts and high contribution margins are we are proud of

because we have earned it.

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Company Organization

Responsibility Manager Assigned

  Entire Erie Team 

Team Lead, President & CEO

R & D, Vice President Samantha Walston

Marketing, Vice President Samantha Walston

Production, Vice President Tracy Wahl

Finance, Vice President Ramiro Valdivieso

Quality Assurance Erin Straight

Human Resources Erin Straight

The team’s company structure (pictured above) was set up in the beginning to establish order

and organization. We knew as a team that we would have to perform a number of highly

important roles within our organization to ensure our overall success. Samantha, took on the

roles of Vice President for R & D and Marketing. Her role as Vice President for R & D would

include responsibilities such as research, planning, and implementing new programs and

protocols into their company or organization and overseeing the development of new products.

She would also be responsible for communicating with customers about products, explaining

who is offering them and why they are desirable. Erin accepted the task of being the voice of

Quality Insurance and Human Resources where she would play a crucial role by making certain

that our products meet all facets of the customer’s buying criteria for all new products

introduced. Our Vice President of Finance Ramiro, and also known as Chief Financial Officer
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(CFO) would oversee all financial related matters where depth and scope is relative to the size of

our company. This included responsibilities such as directing financing strategies, market

analysis, forecasting and budget management as defined by the board of directors. Lastly, Tracy

accepted the role of Vice President of Production, which would require her to direct and

coordinate the development and manufacturing of all sensory products made by the Erie

Corporation. We in turn negated titles as the project progressed due to the cohesiveness of the

team as each member aided in all categories from week to week and round to round.

Competition

Key advantages that have allowed our team to survive is due to us establishing a long reputation

for innovation and commitment towards developing new products. Throughout the course our

team continued collecting and interpreting data on competitors, defining and understanding the

industry, and identifying with our competitors’ strengths and weaknesses. Using this method it

has allowed our team to improve our differential strategy by developing innovative products to

help build barriers between our competitors (Casey, 2011) Based on Porter’s Five Forces model

we determine our competitors strength by substituting products continued to attract customers.

Another advantage that our competitors may have found difficult to match our teams control

over their entire process of product development, manufacturing and marketing.

 Marketing

From the start of our simulations, our company was very much aware of the importance of

not only knowing our customers, but knowing our competition even better. In the 2nd

simulation round, we were in a decent position but quickly noticed that there was definitely
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some opportunities and room for improvement within our marketing department. Even

though we had 2 products, Eat (low-tech) and Epic (high-tech), we noticed that Digby out-

performed us in low-tech sales and low-tech units sold. After analyzing the report, we found

that they priced their product higher than ours because their product had a better

performance, and a higher reliability. This was considered a threat because we didn’t want to

lose our market share to a better performing product that was priced more than ours. So with

that, we had to play towards our strengths. In that round, our customer satisfaction was

higher, as well as our customer awareness and accessibility. We knew that customers wanted

a low-tech product with an age of 3 years so we didn’t make any changes to that. Instead, we

increased our price by just $0.25 so that we can continue to stay within a competitive price

that wasn’t too low or too high. The mistake that Digby made was increasing their price by

$3.50 which drove their customers away to a more affordable product. Since we had a higher

customer awareness (%100), and were priced well, we were able to increase our market share

from 28.8 percent to 37.7 after just one round. 

 Production

As the simulations continued, we wanted to make sure that we kept a competitive edge

within our production department because in order to sell more products and increase our

sales, we needed to adjust our orders and our plant capacity accordingly. In each of our

simulation rounds, we made sure to take note of the increase of consumer demands so that

our production didn’t too much over what our current market share was in comparison to the

demand of units. In the 5th round we held 38 percent of the low-tech market share. Since the

total units sold was 8,117 with an increased demand of 20 percent, that would mean that in
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the next round, we could potentially sell 3,701 units, if our market share remained the same

into the next round. Therefore, we made sure to adjust our order size and our capacity to

match our sales forecast. Other companies like Baldwin and Chester ordered and produced

more units that what they actually sold so they ended up having left over inventory at the end

of the year. We also made that mistake a few times in the practice simulations which is why

we put more attention and thought into our production department once we hit the live

rounds. Overall, I would definitely consider our ability in the production line as a strength

because we were able to meet our sales forecast targets which increased each round. We have

a great understanding of the rate at which the other companies are producing and based on

our customer loyalty and our market share, we were able to produce what we needed to in

order to produce higher earnings and higher contribution margins. 

Industry Analysis
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The bargaining power of customers and the threat of new entrants along with competition from

other teams are the three key forces which posed a threat to our business. The competition from

other teams has limited our restrictions on keeping prices low in our product marketplace. Our

team understood that factors such as these would play a major role for the purchasing decisions

of customers. (Pratap, 2018)

Detailed Results

By innovating new sensor products it allowed the Erie team to attract new customers and give

old customers a reason to keep buying our products. Our team decided to operate in this

competitive sensor industry by matching prices with other top rated products from other

teams. Implementing innovative pricing and buyer retention strategies were important to us

because it enabled our team to advance in the sensory market. In order for our team to

continue succeeding we had to address critical factors that would allow our team to remain

competitive in the sensor industry market.

Strategic Recommendations

The strategic plan has to address the contribution margin of 44.45% on Sales of $224K , which

on the surface may seem very desirable but has room for improvement as can be seen by the

profit of only  $46K. If we draw a comparison on how well Digby did in terms of profit of $47K

based on sales of $183K, we can see there is room for improvement. Since the contribution

margin is defined as sales minus (direct labor + direct materials + inventory carrying costs),

divided by sales, our focus will be on lowering all 3 elements of labor, materials and inventory

carrying costs. We can increase automation to lower labor as seen in the Custom Modules

screenshot showing 1075 employees, modify production forecast and order quantities to reduce
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inventory carrying costs which will address the overproduction seen in Section 4 Production

below.

Team Charter Assessment

Our team did well with project management. Each round we would have different team

members take the lead on discussing decisions for our products, marketing, and plant utilization.

Initially, our overall plan that we maintained from round to round, was to research and study the
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habits of our competitors. We would also conduct 2 conference calls per week to discuss our

findings, communicate as a group on what changes to implement and then together, schedule our

next meeting. This flow worked really well for us and allowed for effective project management.

To avoid any conflict management, we set up rules that worked really well for us throughout the

course. In the event that a member had to miss a meeting, that member reached out to the rest of

the team members. We would also try to find alternative methods for teammates to attend

meetings or have them take on another task for anything that was missed. In the event that a

member cannot be reached, the plan was to use alternative ways to get in contact with students.

Such as Text or email, social media platforms like LinkedIn. Fortunately for our group, we never

had any issues with contacting members. All members would respond the same day. If a member

did not complete their work on time, it was agreed that the rest of the team would continue to

inform team members of deadlines. As well as send out emails reminding teammates that our

deadline is approaching. If tardiness persists an email will be sent out to the professor. If the

work was unsatisfactory, we would inform teammates about corrections that need to be made to

ensure the quality of our work. Schedule a time to work with teammates to make corrections or

improvements where it is needed. If a member drops a course, the rest of the group would

continue on without students, having a team pick up additional work was needed.  If members

have an unavoidable emergency that delays work, the plan was continuing on without students,

having a team pick up additional work was needed. In the event of minor disagreements, we

would offer insight and alternative solutions and request input from the rest of the team. For

major disagreements, it will be important to take into consideration the majority. Peer review

will be used to fairly offer feedback of how the team performed. If the performance was low,

substantiating examples will be given to support it. If canvas was temporarily offline, we would
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utilize google docs, text and email to communicate and share documents that are accessible to

everyone. For other potential conflict, Refer to the project overview of expectations and

determine the best solution that meets the requirements.

Team Rules / Ethical Responsibility

 If tasks assigned to you cannot be completed, it will be expected that teammates reach out

to the team leader and/or other team mates no later than Friday at night to avoid missing

deadlines. This helped our team as we maintained constant communication via group

text, emails and conference calls.  We had a team member that suffered a loss in their

family and through communication we managed to still have all tasks completed in a

timely manner. 

 Communication should be directed to the Team Lead regarding questions about tasks that

are assigned early on so the rest of the team can assist if needed. Our team would meet 1-

2 times per week via conference call and talk almost daily via text to communicate

strategies and discuss results.

 Provide constructive and respectful feedback with clear direction.  This was done

consistently. Our team is a cohesive unit which respects each other’s ideas.

 Engage and contribute equally to the team.  Everyone chipped in to make certain we

produced quality work each week. 

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Team Effectiveness

To avoid any conflict management, we set up rules that worked really well for us throughout the

course. In the event that a member had to miss a meeting, that member reached out to the rest of

the team members. We would also try to find alternative methods for teammates to attend

meetings or have them take on another task for anything that was missed. In the event that  a

member cannot be reached, the plan was to use alternative ways to get in contact with students.

Such as Text or email, social media platforms like LinkedIn. Fortunately for our group, we never

had any issues with contacting members. All members would respond the same day. If a member

did not complete their work on time, it was agreed that the rest of the team would continue to

inform team members of deadlines. As well as send out emails reminding teammates that our

deadline is approaching. If tardiness persists an email will be sent out to the professor. If the

work was unsatisfactory, we would inform teammates about corrections that need to be made to

ensure the quality of our work. Schedule a time to work with teammates to make corrections or

improvements where it is needed. If a member drops a course, the rest of the group would

continue on without students, having a team pick up additional work was needed.  If members

have an unavoidable emergency that delays work, the plan was continuing on without students,

having a team pick up additional work was needed. In the event of minor disagreements, we

would offer insight and alternative solutions and request input from the rest of the team. For

major disagreements, it will be important to take into consideration the majority. Peer review

will be used to fairly offer feedback of how the team performed. If the performance was low,

substantiating examples will be given to support it. If canvas was temporarily offline, we would

utilize google docs, text and email to communicate and share documents that are accessible to
TEAM ERIE FINAL PAPER

everyone. For other potential conflict, Refer to the project overview of expectations and

determine the best solution that meets the requirements.

Team Charter Assessment

The critical success factors that impacted our team includes communication because it ensures that all

members of the team clearly understands requirements which is why we started communication early and

close the loop so all members are on the same page. Defined Roles and Responsibilities was also

important because it minimizes confusion within the team and expectations are clearly defined.

Collaboration, because when people are involved with an idea from its inception and are encouraged to

provide their perspectives, they tend to commit to achieving the goal so we encourage everyone to

participate and offer their perspective on the project and keep an open line for feedback and suggestions.

Commitment, because everyone should understand the overall goals and direction of the team as well as

find out how they fit in with the overall structure of the team. So, we would continue to encourage and

motivate each other so that all members are aware of the dedication within the team so that each person

strives to contribute their equal part. Teamwork, because it is often a crucial part of a business, as it is

often necessary for colleagues to work well together, trying their best in any circumstances. Each team

member will cooperate, using their individual skills and providing constructive feedback, despite any

personal conflict between individuals.

Conclusion

Overall, we are very pleased with the financial progress we are making since the birth of our company to

where it stands today. Each week we have done our best to make every financial decision   very

intentional so that it offers us the ability to continuously be successful in every round. We take a deep

consideration in our consumers’ needs, our competition, as well as our company’s ability and potential to

be a leader in our industry. We were very fortunate to not have to take an emergency load during the

simulations like other groups. I believe that was because we strived to really understand how our
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decisions in each department impacted the business as a whole. We also paid very close attention to the

performa report because it would recalculate the potential results so that we could see if the changes we

implemented, increased or decreased our sales, stock price, or net margin.

References

Capsim (2018) Intro to Business: A Primer Retrieved from

https://ww3.capsim.com/PDF/CapsimCoreBusinessPrimer.pdf
Pratap, A. (2018, July 24). Notesmatic . Retrieved from Five Forces Analysis of Ebay:
https://notesmatic.com/ebay-five-forces-analysis/
Casey, K. P. (2011). USA Today. Retrieved from
https://usatoday30.usatoday.com/money/companies/management/2007-04-29-ballmer-ceo-forum-
usat_N.htm
Capsim(2020) ZP89336_1 Erie Annual Report Round 8-2027 Retrieved from
https://ww5.capsim.com/capsimplatform/annualreport?
simKey=412993&round=8&teamKey=2459154&historyKey=0&teamName=Erie&token=B1275A1B17
D3112D83DB02246552C21D