SimulationInstructionsThis week, you will read a seri.docx

Simulation
Instructions:
This week, you will read a series of decisions from an actual
simulation. They will be in written format. The goal here is to
examine the criteria that went into the decision (s), the process
you used to take a decision and the assumptions you made as
your team worked through the decisions.
Length of this assignment should be as you see fit. Write as
much as you need to answer conclusively without including
unnecessary information.
Please review the introduction in detail to ensure you are
familiar with the situation and members of your team.
Respond to each request in the simulation with a full and
complete answer based on your work in this course and your
learning from other MBA courses as well and your non-
academic life.
Good luck!!
Introduction
Cast:
Jacob Romero - General manager
You - Division manager
Alan Sidu – Forman
Reggie Atkinson – Charge hand (welding – and union steward)
J Simon Chu – Charge hand (assembly)
Rena Davis – Charge hand (shipping)
Joe Damson – Charge hand (design and quality)
Background
Big Dog, a design, manufacturer and rebuilder of small
industrial equipment, was founded in 1987 by James Lambert

and Jose’ Perez at the kitchen table of James Lambert’s home.
Both men had welding and engineering degrees and were
unhappy with the future prospects of the businesses where they
were employed. Big Dog with an investment of $25,000 each
and a two year time line to see of they could be successful. Big
Dog enjoyed early success, but began to experience quality and
delivery problems as it grew from a small shop of ten
employees who built and repaired equipment into a design and
manufacturer of the equipment. In addition, the ebb and flow of
the market for small equipment, new competitors with more
resources and a lack of a coherent vision and strategy on the
part of the owners influenced the growth of the business.
One of the main issues facing the business was the lack of a
coherent vision and strategic focus on the part of the two
owners. Inconsistent goals, the desire to maintain a small,
intimate, family environment on the floor and offices, and a
lack of follow through on initiatives and plans meant they
business tried to be all things to all people. James and Jose
rotated the role of CEO and COO every two years.
In 2010 Jose decided to work half time due to serious health
issues but kept his role as in the business. In early 2011 Big
Dog hired its first general manager, Jacob Romero. Jacob’s
first goal was to establish, for the first time, a management
team to run the day to day functions of the business so the two
owners could concentrate on business development with Jose
looking to retire and sell his ownership stake in 214. Jacob
spent the first three months putting into place a management
team including the Finance manager, Design manager, Customer
delivery manager, Sales and marketing manager and Quality
manager. Jacob spent the first three months of this year working
with James and Jose’ to develop a core set of strategic goals and
plans for the next two years. Three business challenges faced
the business:
· New, low cost competitors from China and South America
entering the region
· Lack of investment in technology

· Poor quality of deliverables and designs to meet unique
customer requirements.
Jacob has just returned from a two day planning session with
James and Jose who attended out of interest and concern for his
shareholding.
Initial Meeting in your office:
Jacob,
(sigh) “… and we have a focus now for the future. James
vision is to develop and better integrate the core business and
Jose vision is to break the business into competing units. They
have agreed to step back from running the daily activities of the
business and appoint a management team to run the business.
Both men have agreed in principle to support the management
team. Of course, the management team is not united on how to
move forward but has developed a set of short term strategic
goals for your team.
Three main business goals are set of the year:
1. Drill deep into existing customers for more repairs and
rebuilds as this is the most profitable part of the business.
2. Develop and deliver a Capex plan for new equipment and
tooling requirements.
3. Reorganize the shop floor to exploit efficiencies and
economies of scale in the design, building and delivery of
equipment.
I want you to meet with your team and review these goals and
come back to me with plans for how to meet them.”
Your office:
You leave the building for a lunch break in the bustling corner
of a local coffee ship. You take your I-pad and ponder a blank
notes screen. You say to yourself “better speak to my guys!”
Situation: A meeting of a production team at Big Dog
Industries.
ALAN
I’m relieved to hear we have some clear goals although I’ll
believe it when I see it! And what does this really mean to get
“efficiencies” and “drill deeper” with customers.

REGGIE
I agree. This is fine but my guys are already stressed with
deadlines and quality issues so let’s make this easy and
painless, OK?
RENA
Yes, we have work to do and this take time -- I think a lot of
our employees aren't really sure what we expect anymore
anyway. In the past few years, we've gone off in several
different directions. We have a lot of people working really
hard on the wrong things. And what the hell is Capex anyway?
SIMON
I agree and I really don’t expect much to happen since this
really does not involve us directly anyway. Just tell us what
needs to be done to get to these goals and I’ll tell my guys what
to do!
ALAN
But at least we have a direction for the first time in a long time.
Let’s give management the benefit of the doubt here, no?
SIMON
(shaking his head side to side) If you say so but I’m skeptical!
REGGIE
What did the GM actually say?
You recount his comments. Charge hand (welding – and union
steward)
JOE
Hey, it’s more information and is a new direction, eh?
YOU
Before we go any further, we need to decide on what needs to
happen in our shops to make this happen. It's fine to talk about
this, but what do we really expect them to do?
Your team looks to you! What will you do? Please list the
steps you will take to get your team oriented to the strategy.
Please offer your rationale!

___________________________________________________
JOE
OK, at least we have more information than in the past. And
some sort of a plan
SIMON
I hope this works. Colour me sceptial!
ALAN
I think a little structure will be good for this company.
RENA
It's all talk right now. I'll believe it when I see the management
team working well.
SIMON
Come on, people, we are all in this together.
YOU
How do we share this with out teams?
1. Post on the chop message boards– it is the fastest and most
efficient way to communicate about the strategy. Questions can
be posed.
2. Charge hands meet with their teams. This will allow all
employees to hear the same message from the same person at
the same time.
3. Send an email – this makes sure the message gets out.
4. Attend a meeting with each Division. Although time
consuming, this will allow you to personally take the strategy to
each unit and tailor the message.
Please choose an option and write down your rationale.
Email:
To:
FROM: Marty Keller, Director, sales and marketing
RE: Product Improvement Ideas
Cc: General Manager
I just had an interesting conversation with the Vice President
for Strategic Planning at GlowMo. They're looking long-term at

expanding their landscaping operations into Southeast Asia. He
was concerned that all Mobots have been shown to be less
reliable and require more maintenance in high-humidity
situations, and that many of the areas in this new market have
high-humidity climates.
Email
FROM: Angela Connors
TO: You
RE: Communicating the Strategy
Please share with me the rationale for your choice of
communicating the strategy. I want to make sure I am in
agreement.
You are listening to the radio …………………….
MALE ANNOUNCER (radio)
…the win was the first ever in the history of the World Cup. In
business news, demand is higher than supply for many of the
parts used in high technology manufacturing. Microchip-
controlled motors, used in products as diverse as helicopters
and robotic lawnmowers, are in such high demand that many
manufacturers are backordered. Motor prices are expected to
rise steadily.
In the hallway ……..
GRACE
So Paul is completely frustrated by our vendor, MotorWorks.
They make the best motors for our mobots, but they don't
always deliver on time. So, now he's saying we should start
building our motors internally.
MARTY
Doesn't he realize that MotorWorks is also our customer? They
buy mobots for all of their facilities. If we stop buying from
them, they might stop buying from us!
GRACE
Well, you better talk to him about that. I hear he's going to the
boss with his idea.
Video Phone call
PAUL

Good morning, I guess you're not in yet. We start the day early
in Operations. Anyway, I'd like to recommend we begin
building the microchip-controlled motors for our mobots
internally. We've been purchasing them from MotorWorks... the
quality has been good, but delivery has been unpredictable.
Frankly, I think we would do better to build the motors
ourselves. I'll send you an e-mail with the details.
Marty Keller in your office ….
MARTY
Hi, I just need a minute of your time. Paul told me he would be
talking to you about making our own microchip-controlled
motors. I'm sure you're aware that our current vendor,
MotorWorks, is also a large client. You can be sure that if we
stop buying from them, they'll stop buying from us. I hope
you'll take that into consideration when you discuss this with
Paul.
Email
This e-mail is to follow-up my phone message regarding the
microchip-controlled motors we use in our mobots. We have
been using motors from MotorWorks, Inc. Their quality has
been consistently good, and their prices are consistent with their
quality. However, their ability to deliver the motors has been
unreliable, and this has caused delays in the manufacturing
process.
FROM: Paul Simpson, Director of Operations
TO: You
RE: Make Verses Buy, Microchip Control
Manufacturing the motors internally would address the delivery
issues and reduce manufacturing delay. Initial costs will be
higher, of course, due to start-up costs, but that should balance
out in about 2 years.
I'm looking forward to your recommendation. Thank you.
Decisions:
1. Create a partnership with Motorworks to reach agreement that
addresses both their issues and your issues.
2. Contract with several motor suppliers. Having several

suppliers will guarantee a steady supply of motors and you will
no longer have to reply on Motorworks.
3. Execute an exclusive contract with you supplier. Agree to
purchase parts exclusively from Motorworks in return for
guarantee delivery
4. Evaluate customer satisfaction with part. Before you make
any commitments, you want to make sure the customers are
happy with the motors.
5. Begin building the part in-house. Paul is correct! Building
the part in-house is a logical conclusion.
Email
FROM: Paul Simpson, Director of Operations
TO: General Manager
RE: Motorworks
I understand your decision. At least if we can get a clear way of
moving forward and addressing the issues.
GRACE
Hey, what's that you're reading Marty?
MARTY
This are the results of the customer satisfaction survey we did
last year. We did very well in some areas, but not so well in
others. One of the biggest complaints for WatcherMo and
SensorMo seems to be how long it takes our customers to get
their mobots serviced. If we could get service people out there
faster, or get them to-
My gosh, what is that thing?
GRACE
This is the secondary blade housing from the WatcherMo. I
heard that service people have been fixing these pretty
regularly. We're trying to figure out if can improve the housing,
so it doesn't need as much service.
Watch it, that thing can take off your hand.
MARTY
Sorry, I didn't know.
GRACE

You know now.
Email
FROM: Marty Keller
TO: You
RE: Customer Satisfaction
Our latest research indicates that our customers are not always
satisfied with the service for our WatcherMo and SensorMo
mobots. As part of our new effort to become more strategic, I'd
like to focus on this issue.
Although there are many things we need to do, we need to
determine a "first step." I've developed four suggestions, and I'd
be interested in your input. Which do you think is most
appropriate?
In the cafeteria ………….
JACK
Oh hey Janice, did you get the time sheet data for R&D? We
really need to close the books for this month.
JANIS
No, I still don't have it. They're always behind. Every month I
have to beg them to provide that information.
JACK
Oh boy, those guys really need to get their priorities straight.
Half the time I go over there, they're not even working on
official projects. I saw this one guy, he told me he was working
on a sensor that could be used in a home security system. What
the heck does that have to do with mobots?
JANIS
I don't know. You know, things are just different over there.
Meeting room …….
JACK
I think we have to be realistic about this service thing. We
already have serious overhead invested in providing service.
We're just breaking even on service contracts.

PAUL
I have to agree with Jack. We meet every industry standard for
product reliability.
MARTY
Now, wait a minute. Our customer feedback was pretty
specific. Our customers don't seem to have a problem with the
fact that their mobots need service. The issue is how much time
it takes for the service to be completed. It's costing them money
in downtime.
JANIS
We've had open positions in Service as long as I've been here.
We have a lot of trouble finding qualified technicians.
GRACE
We've been tracking service calls, and we've noticed a trend.
Some of the parts are wearing out regularly. We could probably
work on improving those parts, and reducing the number of
service calls. But, of course, that would take time. And money.
What do you think?
On the TV
NEWS ANNOUNCER
Administration officials refused comment on how so many cats
had managed to sneak into the Rose Garden. In business news,
the mobot industry is enjoying a surge in popularity, with
demand for the robotic lawn mowers often outstripping

production. Many mobot manufacturers are focusing their
efforts on increasing capacity to meet the growing demand.
In your office .
GRACE
I've had a lot of complaints lately about the way we get work
done in R&D. Before we were acquired by VTI, it was standard
practice that R&D people could spend up to 15% of their time
on independent projects. It's a model that's worked really well
in other organizations. The end result is that we get a lot of
innovative ideas that we wouldn't get otherwise. Now, I
understand that things have changed since the acquisition.
We've become more focused, right? So, if you think it's time
we changed things, well, just let me know.
What actions will you take?
Please write down your decision and rationale
Video Phone from Angela
ANGELA
I'm glad to see you're making progress on your strategy
implementation. I think you need to begin looking at the way
your business unit is organized. However, I think you should
start small. I'd like you to evaluate the way your Sales and
Marketing department is set up. I'm not necessarily suggesting
that you change anything. Sales and Marketing may be set up
just fine. But if you think changes are appropriate, I'd be
interested in hearing about it. I'm looking forward to hearing
your recommendation. Have a good day.
What are your recommendations?
Please write down you recommendations and rationale for each
one!
Video Phone
ANGELA
Good Morning! Today marks the beginning of your second year

as General Manager of VTI's mobotics division. I know you
have a staff meeting today. I have three initiatives I'd like you
to consider for this year. They're all important, but I'd like you
to choose one as your top priority for this year. I've sent the
initiatives to you via e-mail. Take a look, and please discuss
them with your staff. Good luck!
Email
FROM: Angela Connors
TO: you
RE: Year Two Initiatives
As we discussed on the phone, here are the three initiatives I'd
like you to consider for this year. Please discuss with your staff
and choose one as your top priority.
1. Recruiting the top talent in the industry
2. Improving internal systems and processes
3. Gathering and distributing customer data
Lunchroom ……………
MARTY
Why is everyone always working in the lunchroom? Doesn't
anybody ever eat in here?
JANIS
I have all these Human Resources projections to do for Paul's
capacity expansion project. He has this aggressive plan to
increase the number of mobots we make each month. Some of
these changes are pretty extreme.
MARTY
What? We haven't talked about any of this in the staff meetings!
We haven't even finished the final projections!
JANIS
Well, you better talk to Paul, then.
Meeting Room ……………
JANIS

I think all three of the initiatives that Angela has suggested are
important. It's going to be difficult to select just one priority.
MARTY
Not to me, it isn't. To me, the customer is the most important.
We need to focus on improving our customer knowledge.
PAUL
I agree, the customer is most important. And customers care
about getting a good product at a good price. Hey, that's basic
business. That's what we should focus on.
JACK
Paul has a good point. It's time we learned to manage costs
around here. Once we get that under control, then we can worry
about other things.
GRACE
We're in a technology field. If we don't improve our
technology, our competition is going to eat us alive. There are
only so many qualified engineers out there. If they go to our
competition, then what are we going to do?
1. Recruiting the top talent in the industry
2. Improving internal systems and processes
3. Gathering and distributing customer data
In the hallway …………..
JANIS
Have you spoken to Marty lately? Apparently he has a
customer that's demanding we cut prices on our mobots for
them. They think our prices are too high?
JACK
Cut prices on our mobots? Are they out of their minds? Why
on earth would we do such a thing? We shouldn't even consider
it!

JANIS
Well, the customer is MowCo, and they account for about 30%
of our sales. I'd hate to see them go to one of our competitors.
JACK
Well, like I was saying, we should cut our prices for them.
Anything to keep the customer happy, that's what I always say.
Don't I always say that?
JANIS
No, you never say that.
JACK
Hmmf…..
On the video phone
JACK
Good morning, I have an interesting new opportunity for us.
I've been in contact with the President of NewTech, a small
technology firm. They've developed a new technology that will
regulate the humidity inside our mobots. That means our mobots
would work much better under high humidity conditions and
require less maintenance. Now this is something nobody in the
industry has right now. I hope we can discuss this at our next
meeting.
In the hallway ………
GRACE
On your way to the meeting?
PAUL
Yeah.
GRACE
I guess Jack Kirby is a technology expert now. Since when

does he bring in technology vendors?
PAUL
Well, I've heard some pretty good things about this company,
NewTech. You know, I think if they can really address the
humidity problem, it's worth pursuing.
GRACE
Hmmph. I never thought I'd see the day when we'd let Jack
make a technology decision! This is going to be an interesting
meeting!
New report on radio ………
NEWSCASTER
And now, the business news. Are you looking for good service?
Well, the definition is changing. We spoke to Marty Keller,
Dir. of Sales and Marketing for VTI Mobotics.
MARTY
I think the customer's definition of good service is changing,
and businesses have to change along with them. We've looked at
options ranging from contracting with outside service providers
to stationing service personnel at the client's site to training
clients to do their own service. The important thing is to
understand your client's needs and discover a solution that's
most appropriate to their situation.
In your office ………..
MARTY
We have a problem, and I could use some guidance. MowCo
has asked us for a ten percent price break on all mobots they
buy from us. As I'm sure you know, MowCo has been one of
our top customers for the past few years, buying large quantities
of WatcherMo and SensorMo. Their business accounts for
nearly thirty percent of our total sales. We've never had a
policy of offering price cuts before, but… well, with a client
this big, I just assume that we're going to have to do it. We

can't risk losing their business.
What do you recommend?
Please reply in writing with your recommendations and
rationale
In the meeting room ……………..
JACK
This is an excellent opportunity to partner with another
company. NewTech has the technology to address the humidity
problem with our mobots. Nobody else has this yet.
MARTY
Actually, at least two of our competitors have been working on
this. The technology isn't that new.
GRACE
Exactly. Why do we feel the need to go to some outside
company to address this problem? I've had a team working on
this problem for two years. Why would we want to buy some
technology? We should have our own version within a year.
PAUL
I'm concerned about trying to integrate someone else's
technology into our products. I'd have to completely retool the
production lines.
MARTY
I think our customers would like us to solve this problem sooner
rather than later. If we can address it now, let's do it now.
GRACE
OK, fine! Let's just undo two years of R&D work. Jack's the
Director of Finance, for crying out loud. Why are we letting
him drive this decision.
JANIS

Part of Jack's job is to determine partnership opportunities. Ok,
I think we've all raised some good points here, and I think it's
time we made a decision.
What action do you take?
Please write down your actions and their rationale?
In the lunchroom ………..
JANIS
Are you okay? I've never seen you look so nervous. What's
going on?
MARTY
I have a meeting in fifteen minutes with the General Manager
and the big boss from VTI.
JANIS
Angela Conners? Since when does she make you nervous?
MARTY
They want to talk about revising the sales force compensation.
You know how hard it is to get good salespeople. They work
here because the money's good. If they don't like their
compensation, I don't know how we'll keep them here.
JANIS
Wow.
MARTY
Maybe you ought to join us at the meeting. After all, you'll
need to be involved in any compensation decision
Please be sure to end this simulation with a one page reflective
piece on any significant learning from the experience including
how it does and/or does not reflect your decision style as per
the assessment completed prior to the course. Include it with
you responses to each simulation scenario response.

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