JEREMY BROADBOOKS
JAMIE DULY
KUNDAI NANGATI
DAVID SIMPSON
Baldwin Company
INDUSTRY COMPETITION:
SURVIVAL OF THE FITTEST
QUALITY
PRICE
MARKET
SHARE
INDUSTRY CUSTOMERS:
KNOCK, KNOCK.
WHO’S THERE?
NICHE
VALUE
SENSOR
INDUSTRY
CUSTOMERS
INDUSTRY SEGMENTS:
DECISIONS, DECISIONS
LOW ENDSIZE
HIGH END
BALDWIN
BROAD
DIFFERENTIATOR
INVESTMENT
IN ASSETS
PRODUCT
PLACEMENT
INCREASED
EFFICIENCIES
BALDWIN COMPANY:
A STRATEGY EVOLVED
BALDWIN COMPANY:
PRODUCT LINE UP
HIGH
END
BISON
BLAZE
BALDWIN COMPANY:
A CLOSER LOOK
SALES
• Average
Annual
Growth of
13.1%
MARKET SHARE
• R8 18.2%
CUMULATIVE
PROFIT
• $81,595,208
CONTRIBUTION
MARGIN
• R8 47.9%
• Averaged
Annual CM
Growth of
7.4%
$4.5 MILLION
INVESTMENT
IN R4
INEFFICIENT
SPENDING
LOSS OF
COMPETITIVE
ADVANTAGE
BALDWIN COMPANY:
TARDY TO THE TQM PARTY
CONSERVATIVE
INVESTMENT
LOWERED
MARGINS
VARIABLE
COSTS
BALDWIN COMPANY:
AUTOMATE ALREADY!
- I N C R E A S E D D A Y S O F W O R K I N G
C A P I T A L
- C R E A T I V E W A Y S T O U T I L I Z E C A S H
- DEVELOP NEW PRODUCT
- INCREASE CAPACITY
- PAY OFF LONG TERM DEBT
- M A I N T A I N L E V E R A G E
BALDWIN COMPANY:
SWIMMING IN CASH?
WHAT WE DID RIGHT
BALDWIN COMPANY:
THE FINAL TAKE
T H I S W A S O N E A R E A T H A T T R U L Y H E L P E D
O U R T E A M G E T O U R F O O T I N G . Y O U S E E , B Y
T H E E N D O F T H E S E C O N D P R A C T I C E G A M E
O U R T E A M H A D N E A R L Y 2 9 % M A R K E T S H A R E
W H I L E O U R C L O S E S T C O M P E T I T O R O N L Y
H A D 1 9 %
Honed Our Strategy in Practice
Rounds
Let Bid Drift Into the Traditional Segment
 Helped to cement our
status as a broad
differentiator.
 Was a good move
considering Bid was a
weak product in the High
End segment.
 Ended up with 26%
market share in this
segment (2nd highest
behind Andrews at 27%)
H O W W E C A N A P P L Y T H I S S I M U L A T I O N I N
O U R B U S I N E S S C A R E E R S
Final Takeaways
Organizational Skills
 A team in chaos with no
idea where to start on
particular projects is
doomed to failure.
 Strong organizational skills
must be employed to define
work projects and set them
in motion.
 Essential traits needed for
a successful and organized
team include:
 Composition
 Structure
 Hierarchy
 Function
Communication is Key
 Communication is very
important
 Each and every team member
has something valuable to
contribute to the project
 Things flow much more smoothly
if everyone’s strategy and
expectations are aligned
 The fact that our team
communicates very effectively,
greatly contributed to our ability
to come up with solid
presentations the first few weeks
of class.
 This was only possible due to the
fact that we communicated a lot
outside of class and were able to
coordinate what everyone would
work on.
QUESTIONS?
BALDWIN COMPANY:
Q & A

Baldwin Company: Capsim Exercise

Editor's Notes

  • #3 EXTERNAL ENVIRONMENT - KUNDAI TOUCH ON HOW THESE ARE IMPORTANT FACTORS IN BEING A SUCCESSFUL COMPETITOR IN THE SENSOR INDUSTRY HIGHLIGHT THOSE TEAMS THAT EXCELLED (ANDREWS, CHESTER, ERIE) MENTION OUR GAIN IN MARKETSHARE IN THE 8TH ROUND BUILDING THE FOUNDATION TO CLIMB TO THE TOP
  • #4 EXTERNAL ENVIRONMENT (KUNDAI) QUICK DESCRIPTION OF EACH NICHE AND VALUE CUSTOMER OUR FOCUS WAS NICHE CUSTOMERS WITH A COMPLEMENT OF VALUE CUSTOMERS TO HELP CUSHION OUR MARGINS
  • #5 EXTERNAL ENVIRONMENT (KUNDAI) – HAND OVER TO DAVID WHEN FINISHED DISCUSS THE SEGMENTS BALDWIN CHOSE TO FOCUS HIGH END (NEW PRODUCT INTROS) TRADITIONAL DUAL PRODUCT OFFERING MAINTAINED PRODUCTS IN REMAINING SEGMENTS AS A BROAD DIFFERENTIATOR
  • #6 INTERNAL ENVIRONMENT (DAVID) DISCUSS OUR INITIAL STRATEGY STRATEGY WAIVERED IN ROUNDS 3-4 ATTEMPTED TO LET BEAD & BID DRIFT INTO OTHER SEGMENTS NO R&D WHICH CONTRIBUTED TO LOSS OF MARKET SHARE REBUILT IN ROUND 5 GAINED TRACTION BY MAINTAINING FOCUS ON STRATEGY ROUNDS 6 THROUGH END OF SIMULATION INCREASED EFFICIENCIES ADDED AS GAINED UNDERSTANDING OF TQM INTIATIVES
  • #7 INTERNAL (DAVID) TOUCH ON OUR STRATEGY FOR EACH PRODUCT OUR FOCUS ON ROLLING OUT NEW PRODUCTS IN THE HIGH END SEGMENT – INTRO’D BISON & BLAZE
  • #8 INTERNAL ENVIRONMENT (DAVID) DISCUSS HOW WE WERE ON THE RISE FROM ROUND 6 FORWARD WERE ABLE TO CONSISTENTLY GROW SALES (W/ EXCEPTION OF R4) MARKET SHARE CONTINUED TO RISE CUMULATIVE PROFIT WAS A SERIOUS STRUGGLE AND WAS SLUGGISH TO GROW FOR US CONTRIBUTION MARGINS GREW EACH YEAR – DESPITE DOWN TURNS AND BAD DECISIONS
  • #9 LIMITED INVESTMENT IN R4 OF $4.5 MILLION DAMAGED OUR ABILITY TO REMAIN COMPETITIVE VERY LITTLE INCREASE TO OUR EFFICIENCIES PUT BALDWIN BEHIND OTHER COMPETITORS HAD TO REBUILD THE LOSS OF MARKET SHARE ETC THROUGH THE REST OF THE ROUNDS
  • #10 SHOULD HAVE INVESTED EARLIER IN AUTOMATION OF THE PRODUCTS IN THE TRADITIONAL AND LOW END SEGMENTS WOULD HAVE HELPED WITH VARIABLE COSTS INCREASED MARGINS RESULTING IN MORE PROFIT EACH ROUND
  • #11 DISCUSS THE DRAW BACKS OF HAVING TOO MUCH CASH AND DAYS OF WORKING CAPITAL THE STRUGGLE WITH BEING CREATIVE IN USING THE CASH ON HAND WHILE MAINTAINING THE APPROPRIATE LEVERAGE RATIO