Business Simulation with Professional Development

Executive Summary

The current report aims to develop a clear understanding of the simulation analysis of a proposed smartphone manufacturing company. The information critically identified and evaluates each aspect of simulation evaluation ranging from the company profile to the optimal strategic functions and performance of the company. Based on the results obtained from the simulation analysis, it has been identified that the smartphone manufacturing company has been performing efficiently concerning the marketing, human resources, production, and its range of logistics operations and distribution functions.

Simulation Company Profile

Company Vision: The company envisioned intending to achieve customer loyalty through offering a range of advanced collections of smartphones streamlined with advanced technology and ease of access by the potential users. Additionally, the company is also envisioned building a positive image and reputation through sustainably operating across the domestic and international markets.

Mission Statement: The mission statement of the proposed smartphone company has been constructed by addressing the range of potential characteristics of the product. Despite its crucial focus on the content of potential business areas, the mission statement of the proposed business is to enable middle-income customer groups with series of smartphones that can help them to meet their expectations and desires. The mission statement of the company has been defined by emphasizing changing needs and expectations of smartphone users regarding durability, accessibility as well as best design capabilities.

Values: Values define the underlying philosophies, beliefs as well as principles through which the business operations of an organization are conducted (Kotler, 2000). According to the current proposed business plan, the smartphone company aims to maintain integrity in dealing with customers through offering quality-based products and to become accountable towards the environment using a range of sustainable strategies. Additionally, the proposed business for smartphones also aims to ensure that the customers achieve perceived value on behalf of their engagement with the company’s product and services.

Human Resource: The primary aim of the human resource department of the company is to enhance employee motivation, empowering job engagement, and empowering employee commitment to the business in the long run (Santos & Alonso, 2019). Additionally, the HRM division of the company is also accountable in terms of developing and introducing policies and procedures in order to ensure minimum employee turnover rate and enhancing employee retention in business. To achieve long-term engagement and commitment of the employees, the current company also introduces and complies with the local HR policies associated with employment equality and transparency in organizational processes.

Reviewing Company’s Performance

Performance Review

Competition Analysis

The smartphone industry in Europe has been undergoing a significant shift of growth due to the increasing number of dominant mobile manufacturers along with their highly competitive marketing and promotional strategies. According to the current market choice, customers are strongly concerned regarding the value of their money they spend on purchasing smartphones. Concerning the current European smartphone business industry, the sector is dominated by leading mobile phone manufacturers, namely Apple Inc, Samsung, Huawei, and a range of Chinese brands such as Xiaomi, Realme, Oppo, OnePlus, and others. In a recent analysis, it has been identified that Xiaomi has achieved significant growth in the European smartphone industry with an increase of up to 90% in 2020. The company escalated its performance in emerging European smartphone markets such as Spain and Italy with a significant gain of its share through reaching 28% and 17 respectively during the 4th quarter of the year 2020 (Counterpoint Technology Market Research, 2021).

At the same time, globally celebrated brand such as Apple is also identified as a significant competitor for the current business organization in the European smartphone business industry. Although the annual sales of Apple experienced a decline to somewhat extent, the company has upsurged its annual revenue following its launch of the iPhone 12. The strategy of launching the new brand helped Apple to drive record high in its annual share performance up to 30% during the end of the year 2020 (Counterpoint Technology Market Research, 2021). Nevertheless, other competitors, mainly China-based companies such as Realme, Oppo, and OnePlus have also been recognized to achieve growth in their Y-o-Y growth performance by 1083%, 82%, and 5%, respectively in the current European smartphone industry (Counterpoint Technology Market Research, 2021). Therefore, it is evident that the smartphone manufacturers in the European region have been flourishing their growth performance despite the changing needs and expectations of the customers. In this context, continuous innovation and cutting-edge technology with enhancing mobility are a few among critical drivers that have been enabling organizations to pursue growth in the European smartphone markets.

Explaining Simulation Performance Results

Position: According to the results obtained from the marketing strategy of the simulation company, it has been identified that the method of enhancing the durability of the smartphones using added features enabled the product to successfully attract a large group of potential users in the European markets. The primary intention of the positioning strategy applied in the current smartphone business is to draw the company’s brand image in customers’ minds, specifically in the context of advanced technology, accessibility, and exceptional features of the products (Schulz et al., 2019). In addition, the positioning strategy of the company also includes providing adequate information about extraordinary features and characteristics of the smartphones with a clear comparison report of the products offered by other competitors in the market. The process has enabled the business to ascertain adequate engagement of potential users in both local and overseas markets.

Key Performance Indicators (KPIs): KPIs refer to a set of measurable values to any particular goals or objectives associated with the organizations’ marketing campaigns. It specifies progresses that an organization can obtain from the marketing campaign and also helps to measure the effectiveness of each marketing practice organized and executed by the organization (Kumar, 2018; Kotler, 2000). According to the current business plan, the KPIs generally include the existing profit margin and client or customer retention rate that the business obtained using its marketing campaigns. According to the current marketing campaigns, the use of offline campaigning about the key features and exceptional characteristics have played a significant role for the business to gain the attention of potential buyers.

Financial Performance: According to the results observed in the cash flow statement, it can be identified that the smartphone manufacturing business obtained a total income of € 1,900,074,108.71, which is remarkably an excellent beginning for the company. With the current cash flow information, the requirement of increasing investment in research development, marketing costs as well as recruitment processes have imposed a significant burden for the company to achieve a reasonable profit. The staff remuneration cost includes € 239,023,041.23, as well as costs associated with social security of € 71,706,912.37, are few among key areas that significantly declined the desired volume of profit at the initial start-up operation. The net turnover for the year 2021 is expected to reach € 1,428,009,522.00 with € 1,068,887,748.94 amount of cost of sales. The gross margin recorded for 2021 is € 359,121,773.06, which is also considered a significant financial performance for the company. With due concern towards requirements for budding investment in manufacturing, R&S and marketing activities, the initial net profit projected for the company is € -464,583,287.33 after measuring the ordinary profit activities after tax.

Performance Review

The performance review of the company has been conducted based on results from the simulation process. The primary purpose of reviewing the company’s performance is to critically evaluate the decisions taken by the company for increasing efficiency in each area of operations.

Strategy

Developing and appropriate execution of strategy plays a critical role for any business to accomplish long terms business goals and objectives (Keller, 2013). Concerning the current strategic measures of the new smartphone manufacturer, the business organization critically focuses on increasing the number of its production units across different cost-effective regions, mainly in China and India. Currently. The company’s smartphone devices are manufactured in other geographic areas and are marketed across various European and western areas with the help of the company’s widely diversified distribution network. The strategy of maintaining the substantial value of each smartphone brand and ensuring adequate concern towards changing needs and demands of the customers also play a critical role in the company’s leverage growth in the highly competitive smartphone business industry.

Marketing

Apart from its cost-effective production mechanisms, the company’s marketing and promotional strategies also play a crucial role by encompassing large areas of communication channels to reach potential customer segments. The integration of online promotional tools, mainly social media channels, has played a vital role for the company apart from the outcomes it gathers conventional marketing communication channels. The company’s marketing strategies also include exceptional offline campaigns. In this context, sponsorship programs such as sponsoring a world-class football team by demonstrating the name of eh brand on shirts of the football team is an effective competitive strategy. The annual budget for marketing strategy exceeds 2.5 million, and hence the company’s marketing strategy will further extend by sponsoring World Cups and different global television shows.

The sponsorship strategy can also play a critical role in strengthening its brand image and position in the global smartphone business industry. The method of sponsoring world-class football teams in international events can also help to increase brand awareness towards a large group of target buyers. Nevertheless, the strategy can further lead the company to successfully campaign its smartphone brand in new or emerging business markets across the globe.

Human Resource

The performance in HRM practices can also be considered as a strong KPI for the company in the current smartphone business industry. Currently, the company employs 71 employees in its headquarter for managing activities associated with production, logistics management, finance, marketing, and HR functions. The management hierarchies in the HQ of the company are also responsible for taking global orders and a range of shipment activities. They are also accountable for dealing with customer requests complaints. The total number of the professional body of the company is expected to increase by 25 people in each fiscal year. The HRM department of the company is also responsible for developing and implement policy measures to empower the skills and competency levels of the employees along with strengthening their engagement with the business. In addition, the department is also accountable in terms of effectively dealing with a range of issues faced by employees relating to wage and remuneration, compensation as well as their need for any specific training and development programs.

Logistics Management

The logistics operations of the company involve a large number of activities ranging from sourcing materials from potential to final shipment of finished goods and distributing products to the last customers. In this process, the overall logistics operations are controlled and efficiently handled by the strategic hierarchical members of the company. The department critically focuses upon maintaining a critical focus on getting the right products with the expected level of quality and quantity. Moreover, the division also responsible for designing and developing an appropriate channel for the distribution process of the final products to the potential users, along with maintaining the correct price of each product for the last customer. The strategy helps the company efficiently manage the shipment and other distribution activities with the company’s transportation network. In overseas operations, the company integrates third-party logistics service providers when transporting goods and services from one to another overseas market.

Product Development

The product development strategy in the proposed smartphone company includes a wide array of functional processes. In this context, integrating a continuous process of R&D through expanding its scope and investment plays a crucial role for the organization to produce seamless devices as per the changing needs and expectations of the end-users. The continuous focus on broadening the scope for R&D also enables the firm to include value-based and highly effective technological features that critically address the potential market needs and demands. In addition, the product development segment of the business also provides R&D processes to introduce new products following the completion of the exiting product cycle. The process significantly helps the company to minimize potential risks that can be derived from the existing competitors. In addition, the new product development function of the company further acknowledges the fundamental vision and operational objectives of the organization. It helps an organization to rebuild or refurbish its brand image and reputation in the market. And most importantly, the product development unit of the organization also aims to meet all aspects of standards and principles associated with the company’s sustainable production goals by eliminating waste and radically minimizing impacts derived from the production process towards the natural ecosystem.

Develop future company plans and recommendations

A company should make sound judgments to enhance the positive outcomes and minimize the negative results for the organization. Leaders should solve the issues and make operational decisions that permitted the company to stay competitive. Leaders need to anticipate future needs and make strategic decisions for the organization to be successful for the longer term. The making of decisions regarding day-to-day operation is essential. Still, it is necessary for the leaders to make strategic decisions on behalf of the business to excel in the future. Leaders should discover new solutions to deal with business challenges to remain competitive. Companies should innovate, experiment, should take intelligent risks, and also find more unique ways so as to contribute business and long-term strategy. It is stated that although the company is working on sponsorship strategy and social media channels, the company should bring mobile marketing into its operation. It is recommended that the company should apply a digital marketing strategy aimed to reach the target audience through smartphones, tablets, and other mobile devices such as emails, websites, etc. This strategy would help the company to make usage of modern mobile technology to promote goods and services.

It is further stated that since human resources of the organization deal with issues linked with wages and remuneration, compensation, training, and development programs. It is, however, noted that the company should forecast the needs of the staff in the future apart from recruiting, hiring, and keeping the best talents in the organization. The HR managers should be active in the advisory capacity to give input for the company’s future. The company should also develop well-defined performance metrics, regular performance evaluations, and schemes to rewards the employees for higher performance and creativity in attaining tasks (Askegren, 2005). The HRM departments should even create a higher performable culture in the company and motivate them. This will be helping the company to flourish as employees who feel appreciated in the company attain higher recognition for the achievement in the workplace. It is also analyzed that the company possesses an effective logistics management strategy that provides more significant benefits to the company. However, the still company needs to think about the future of logistics (Benson, 2011).

Company should adopt new technologies and incorporate innovations like cloud technology, trace and trace technology, voice technology, and usage of truck scales. The company should also work upon the 3D printing technology, acting as a significant game-changer for the future. Moreover, the company should also implement configurable solutions and make informed decisions to plan to attain success in the future. The application of automated systems could also be helpful as it will help in offering accurate data (Apte, Maglaras, and Pinedo, 2018). Lastly, it is also stated that the product development strategy of the company was also effective. However, it is analyzed that company still has to make investments in the market research. The company would identify the needs of the customers and should develop new products with benefits so as satisfy the requirements. It is even stated that companies should also strategy to make investments in entrepreneurship. The company needs to allow employees to work upon their inventions, and the company should also learn from customers, which will help mitigate failure. It is recommended that a company should go into alliance and should attain skills in marketing, research, technology, production, finance, etc., to attain competitive advantage (Slack, Brandon-Jones, Johnston, and Betts, 2015). This will decline the risk of product development and will also help in accelerating their new predicts development efforts.

After reviewing the performance of the company, it is stated that the company should bring transparency in the organization which will not only build trust but will also help in customer engagement. A company should also use modern communication tools to communicate with the team to share crucial data and information. The company should also make a good relationship with employees which would help the company attain good performance. It is also essential for the company to look after employee turnover of the company and should give rewards and recognition to its employees. The cultivation of stronger coworkers’ relationships is also termed to be important as this will help the company to build dedicated team-building activities. The building of work culture will also be helpful for the company to align with mission and vision and help employees work effectively. It is recommended that the company should give significant emphasis upon technology advancement to attain profitability and success (Byrd, 2014). These will be acting as essential areas for growth. It can thus be recommended that if a company will give primary emphasis upon human resource management and will apply modern technology in its work, the company would be attaining good performance and success.

Reference

Apte, U., Maglaras, C. and Pinedo, M., 2018. Operations in the Service Industries: Introduction to the Special Issue. Production and Operations Management, 17(3), pp.235-237.

Askegren, P., 2005. Human resource. New York: Ace Books.

Benson, P., 2011. Emerging themes in international management of human resources. Charlotte, N.C.: Information Age Pub.

Byrd, M., 2014. Diversity Issues: Exploring “Critical” Through Multiple Lenses. Advances in Developing Human Resources, 16(4), pp.515-528.

Charlesworth, A., 2014. Digital Marketing: A Practical Approach. Routledge.

Keller, K. L. (2013). Strategic brand management building, measuring, and managing brand equity. 4th ed. Boston: Pearson.

Kotler, P. (2000). Marketing management, The Millenium Edition. New Delhi: Prentice Hall International.

Kumar V. (2018). Transformative marketing: The next 20 years Journal of Marketing, 82(4), 1–12.

Santos, D. & Alonso, M., 2019. Integrated Marketing Communications, Strategies, and Tactical Operations in Sports Organizations. IGI Global.

Schulz, P., Shehu, E. & Clement, M. (2019). When consumers can return digital products: Influence of firm- and consumer-induced communication on the returns and profitability of news articles. International Journal of Research in Marketing.

Slack, N., Brandon-Jones, A., Johnston, R. and Betts, A., 2015. Operations and process management. 4th ed. Harlow: Pearson Education Ltd.

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