GLO-BUS is a completely online exercise where teams of students run a digital camera company in head-to-head competition against companies run by other class members. Company operations parallel those of actual digital camera companies. Just as in the real-world, companies compete in a global market arena, selling digital cameras in four geographic regions—Europe-Africa, North America, Asia-Pacific, and Latin America.
Company co-managers must make decisions relating to R&D, component usage, camera performance, product line breadth, p roduction operations, work force compensation, outsourcing, pricing, sales and marketing, finance, and corporate citizenship and social responsibility. The challenge is to craft and execute a competitive strategy that results in a respected brand image, keeps your company in contention for global market leadership, and produces good financial performance as measured by earnings per share, return on investment, stock price appreciation, and credit rating.
All aspects of the GLO-BUS business strategy game parallel the functioning of the real-world digital camera market, thus allowing you and your co-managers to (1) think rationally and logically in deciding what to do and (2) get valuable practice in making a variety of different business decisions under circumstances that mirror real-world competitive conditions.
6. Yr 5 Initial Market Share
North America
Market Share: 3.3%
Units Demand:
EL – 16,000
MF – 4,000
Latin America
Market Share: 10%
Units Demand:
EL – 32,000
MF – 8,000
Europe/Africa
Market Share: 13.3%
Units Demand:
EL – 64,000
MF – 16,000
Asia/Pacific
Market Share: 10%
Units Demand:
EL – 48,000
MF – 12,000
10. Mission
To dominate the Multi-
Featured (MF) high-end
level camera market in
all regions through
excellent P/Q rating,
competitive pricing &
advertising in those
regions
Then utitlise this in final
years to enter E/L for
more growth
12. Market Strategy: 2 Phase
Phase 2 (yr 11-15)
Utilise cashflow in final
years
Best Production
facility/low costs
Enter Entry Level (EL)
Camera market
Aim for aggressive/rapid
growth
Maintain Higher PQ &
Lower Price = BEST COST
14. Distribution Strategy
WIDEST distribution
Commit to ALL retailers
Higher costs
Offset by major profit
margin of MF
Majority of retailers
Specialist Camera Shops
who PREFER to sell MF
16. Production Strategy
Invest in HR
Pay 10% higher
Invest in PAT training
Invest in R&D
Increase efficiency
Increase productivity
Minimise Factory Size
Don’t over-build
Use overtime no
outsourcing
21. Broad Differentiation - MF
Aim initially @
Multi-Function
(MF)Camera market
Broad Differentiation
All regions
Just maintain Entry
Level (EL) Camera
market
22. Advantages
Less units shipped
lower delivery costs
No-one else going for it
low competition
Aim 3.5 Star PQ
Can raise price BIG
without affecting sales
keeps workforce smaller
less units
No one else will do it!
23. Entry level
Maintain 2 Star PQ
Accept some loss of
Market Share
Maintain Net
Profit/Unit
25. Mature Market Characteristics
Growth of market
dropped to 6-8%
Markets had stabilised
Competition had
“shown their colours”
Discount Bids started
26. MF Camera Dominance
By this stage:
Clear market leader
in MF on PQ
Clear on Strategic
map
No one close to our
niche
Maximising Net
Income per Unit
FijiFoto
27. EL Camera Counter Attack
Have best productivity
Lowest production costs
Drop rating to 2 Star
reduce costs further
Aggressive low-pricing
Gain major market share
increase
Better PQ & lower price
BEST COST
29. Discount Bids
Concern due to our late
entry into EL Market
Team A & D dominant
But they could only win 2
bids each!
Aimed at #3 and #4 in all
markets instead
Maintained higher price
Won the #3 & #4 bids!
47. What Went Right?
No Competition Sector Not Chasing Lowest Price
MF Segment had NO
competition!
MF sector NOT price driven
Higher profit margins
48. What Went Right? cont.
Debt Management Long Term Thinking
Not averse to debt
Not scared of it…
Managed it with cashflow
Only used Emergency Funds
once
Not being tempted to ‘chase’
everyone into EL market
49. What Went Right? cont.
Share Repurchase Long Term Thinking
Early repurchase
Share price low
Planning for all aspects long
term
Design
Production
Marketing
Market position
51. What went not so well?
Year 9 – EL Pricing Error Enter EL Sooner
Lowered EL Price by mistake
Made a LOSS in 3 out of 4
regions on each camera!
Enter EL sooner
Could have got better Year 15
results