BUSINESS GAME PGE4

January 2022

UNIVERSE : 2
TEAM : Rose - 15
NAMES:
1. BERDJOUH Achraf

2. CHAHINE Jeanne d’Arc

3. DOLLET Loane

4. DOPIERRE Alix

5. DUCHEIX Quentin

6. GARNIER Louis

GRADE (instructors only):

Overall (V/NV):
From the following criteria, indicate the value from 1 (not satisfactory) to 5 (outstanding)
that reflects the performance of the report.
1.
2.
3.
4.

Please fulfill this template and send it by email to your instructor at Friday 7th.

Results at the end of the Round 5

Net Income 271 768

Share price 80,77

8,13
Cumulative total return
to the shareholders
1/ Explain the employed business strategy by your company

Our strategy has been to expand in China because of future opportunities, but also to
continue to expand in US and Europe. That's since the beginning we invested in building
an additional factory in China.

We wanted to develop the three categories: hybrid, electric and thermal. And more
specifically, electric in China and thermal and hybrid in the USA and Europe.

Starting by analyzing the market demand and its characteristics, we chose to invest in
equipment in China. These investments are notably external thanks to the acquisition of
patents.

Our policy was very often in "low price" or "equipment". Concerning the price policy, our
selling prices are generally below market with a number of equipment in the average. The
low price we offered is due to a surplus of stock so that we can easily sell our stock. By
selling at lower prices we recovered market share.
Moreover, once we are well established in China, we have decided to develop the hybrid
business even more in Europe.

In the long term, we want to be a company with a low cost policy. However, for the
establishment and the market shares we wanted to remain vigilant with the evolution of
the market which is constant. Therefore, we wanted to remain strong in the areas where
we have gained the most market share, particularly in hybrids in Europe, and to continue
to develop electric vehicles in China.

2/ Identify some concepts from various management-related disciplines used in the

simulation
In this simulation, we have seen some management concepts in different areas.
On the commercial side, we could see the concept of price policy by adapting or not to the
market price or according to our stocks. The management of the price factor was one of
the key elements of this simulation against our competitors. We were also able to exploit
in marketing the management of advertising by defining our strategy as well as the budget
allocated according to the type of conformers. This advertising management was essential
in order to recover market shares.

At the HR level, we have decreased the turnover and decreased the training budget and
salaries. In logistics, we analyzed the stock, which had an impact on our decisions to check
if we are producing too much or stocking too much, in a way to minimize the costs. As for
finance, to diminish the short-term debts we have issued shares, when the price of share
has decreased we bought our shares, and when at the end we have reached 80 $ as share
price we have issued shares and distributed dividends.

3/ Give an example of integration of functional units

Marketing is one of the most important functional units for a company.

In the simulation many choices were possible. First of all we had to choose a budget for
advertising. This budget was defined according to the receptivity of consumers in different
countries, but also according to the receptivity of our competitors.
Then we had to choose a targeting strategy. Our strategy was mainly focused on "low
price" in order to reduce our stocks and "equipment" in order to best satisfy the demand.
This allowed us to sell off the stock, thus making more profit to increase the cash flow.

Moreover, we increased the cash flow with which we tried to distribute dividends to the
shareholders in order to increase the cumulative return of the shareholders, during the
fall of the price of the share we bought an amount that we sold after the last turns to the
rise

4/ Explain how functional units fit into a business strategy

The functional units are integrated in a company strategy because they are centers of
analysis of charges relating to a function of the company, in our simulation it can be:
production, personnel management, distribution...

- Logistics: This service has a real impact on the deliveries in terms of delays and
costs within the different markets. Indeed, these costs can be different from
country to country depending on several factors: the economic policy and its
opening to other countries. The delivery allows to prioritize the countries that
allow the company to maximize these benefits, and therefore where generally the
selling price is the highest.

- Human Resources: The human resources department is also essential for the
business strategy because depending on the remuneration and training or
recruitment policy put in place, it will allow to recruit and keep the best talents
within the company. This will also allow for greater productivity thanks to the
increase in the training budget.

- Finance/Accounting: The finance and accounting department allows a better

management of the bank loans (increase or decrease), to take care of issuing or
buying back shares. These services also allow for the distribution of dividends to
shareholders as well as the transfer of cash to the different subsidiaries of the
group.

- Marketing: Marketing is the last step before the sale, this will allow to manage the
price of the advertisements and the targeting (commercial strategy) as well as to
evaluate these unit costs. A company can position itself either with a brand image
like luxury or with lower prices like "low cost" products.

- Production : This department manages the physical flows by taking care of the
production planning according to the quantity (if there is a surplus of stock) but
also the subcontracting (according to the costs).

- Research & Development : The R&D allows the development of new technologies
(hybrid, electric, hydrogen...) and thus allows a competitive advantage to the
company facing its competitors.