Towson University Importance Teamwork Collaboration in LINKS Simulation Paper A short (5-page maximum) LINKS Individual memorandum instructions as follows:

Towson University Importance Teamwork Collaboration in LINKS Simulation Paper A short (5-page maximum) LINKS Individual memorandum instructions as follows:

A LINKS memorandum is a five-page memorandum on some aspect of LINKS. You’re writing to your

successors in this memorandum. Pick some relevant part of LINKS and pass on some advice to your

successors. Be detailed and specific! You are trying to convince a LINKS novice to believe that you

know what you are doing and to follow your advice. Don’t be vague or superficial in this memo.

Think of this as writing one chapter in the “book of LINKS.” While there may be hundreds of

interesting chapters in this “book,” you only have to write one of the chapters. Here’s some more

advice and some hints:

• This is a 5-page single spaced memorandum (double-space between paragraphs). Number all

pages. Use normal margins (at least one inch on all sides) and normal font size (at least 11-point).

• Write a memorandum to communicate something of importance to your LINKS successors, not

necessarily in the same LINKS firm or industry. Since this memorandum is designed to be of value

to any LINKS participant at any time in the future, it should not contain firm- or market-specific

information, except possibly by way of illustration. For example, there is no point saying that

market region #1 is quite volatile (even if so in your experience), since another edition of LINKS

might have a very different market environment.

• Any topic within the course milieu is appropriate.

• Many LINKS participants have developed sophisticated spreadsheets for tracking, analysis,

budgeting, and planning purposes. Your memo might focus on the what/why/how of your

spreadsheet. The major focus of a spreadsheet memo would be on building the case for using the

spreadsheet. Little attention should be given to the mechanics of running the spreadsheet. For a

spreadsheet-related memo, you may include several additional pages that contain sample

spreadsheet printouts. A spreadsheet-related memo must also include the actual spreadsheet (as an

e-mail attachment).

• If in doubt, it is better to focus on a very narrow topic, and do a good job on it, rather than

attempt to tackle a broad topic (that might require 10s of pages to do well).

Based on past experience, better LINKS memos offer detailed, specific, immediately-actionable,

example-laden counsel on important issues and challenges facing future LINKS participants. Lessthan-

excellent memos tend to be vague, offering only high-level textbook-like observations with little

direct actionable relevance to LINKS. Poor LINKS memos paraphrase the LINKS participant’s

manual, adding nothing new or important to the “book of LINKS.”

I have attached an example of memos done previously. Excellent LINKS Memorandum
Examples
An Excellent LINKS Memorandum
Core Strategic Vision:
A Necessity For Corporate Survival and Prosperity
Michael Beaton,
University of Michigan
“Plan It, Write It, Do It!”
– My Dad, Real Estate Developer
1. Where are we going to go?
2. How will we get there?
3. Why will we be successful?
– Michael McGrath, Product Strategy for High Technology Companies
Introduction
Looking back at our LINKS tenure, one could say that we were good managers but dismal
leaders. We managed certain processes very well, such as product costs and forecasting.
However, we lacked leadership when it came to the critically important matters of strategy. For
example, we pursued a “universal global product strategy” that met nobody’s needs particularly
well and placed our products in a miserable competitive position. And while some companies
pursued “first mover” or “fast follower” strategies, we pursued neither, instead focusing nearly all
of our attention on net income, gross margins, and share price. Likewise, our patent strategy
was very suspect. Instead of employing an aggressive product development regimen to stake
out a claim in key markets, we reacted to other competitors’ patents forcing us to avoid key
markets and forgoing profits.
Basically, we did not balance the forest (broad strategies and trends) from trees (financial,
operating, and marketing details) and we suffered. I believe our tactical missteps were the
result of lacking a clear, “core strategic vision.” This vision should have driven our product
development, market entry, manufacturing, and marketing. Instead, our decisions were based
purely on raw numbers and not on “truly satisfying the customer.” In this memo, I’ll create a
model “CSV” and apply this new vision in certain tactical situations. First, let’s examine how the
lack of a “core strategic vision” contributed to our “corporate blindness.”
Blindness
In his book Product Strategy for High Technology Companies, Michael McGrath describes
corporate blindness:
Some companies appear to be blind or at least sleepwalking. They just keep moving
along contentedly until they hit a wall without ever seeing it coming (blind to the fact that
our single hyperware product did not meet every region’s consumer requirements). . . . A
company may have a vision of its future, but this vision might have a blind spot –typically
an issue or assumption about which it is markedly ignorant (we failed to recognize that
competitors will dramatically update their product line). . . . Since they don’t know where
to go, blind companies go in multiple directions. . . As a result, resources are
overallocated (i.e. our well above industry marketing and service spending), and product
development activities tend to drift (failed introduction of our 2nd Metaware product into
Europe). Frustration results, but this is just a symptom of the malaise. The cause is lack
of strategic vision.
1. Create A Written “Core Strategic Vision” and Have Everyone Sign-Off.
LINKS Core Strategic Vision – The Cure for Corporate Blindness
McGrath emphasizes focus, clarity, completeness, and feasibility in a “Core Strategic Vision.”
We’ll borrow from MaGrath and some of his examples to form a model “LINKS Core Strategic
Vision.” Admittedly, my team didn’t codify an initial vision. However, if we did, it probably would
have read something like the following:
Our strategy will be to develop products that satisfy the customer’s needs by utilizing our
skills to profitably build and market products to provide a maximum profit to our
shareholders. We will do this by providing products that provide a good value to our
customers and a competitive advantage for our firm.
Unfortunately, this reads more like a mission statement rather than a compelling, strategic vision
to guide people and processes. This statement lacks a standard corporate point of view on
which our managers could base their tactical decisions. Consequently, without a vision, we
engaged in analysis and decisions that didn’t complement with one another. For example, we
continued to focus on “high gross margin, low cost” manufacturing but ignored the fact that our
market share was constantly eroding from 20% to 10%. Obviously, a low-cost manufacturing
operation cannot be sustained without higher volumes and increasing market shares.
Consequently, The LINKS Model CSV will be sufficiently focused on determining the answers to
the questions posed at the beginning of this memorandum:
1) Where do we want to go?
2) How will we get there?
3) Why will we be successful?
LINKS Model CSV:
Team X wants to be the leading supplier of Hyperware and Metaware Set-Top Boxes in all
potentially profitable customer segments worldwide. We intend to accomplish this goal by
leading the industry by continuously developing new products, pricing competitively, controlling
costs, supporting customers, and expanding distribution. We strive to constantly understand the
dynamics of the Set-Top Box industry and are poised to move decisively to exploit new market
and technological opportunities when they occur.
CSV Overview:
Honestly, I wish we would have codified this vision from the beginning as it puts in writing broad,
big-picture objectives and forces our executives to relate their everyday tactical decisions to an
over-arching strategy.
Where do we want to go? Team X wants to be the leading supplier of Hyperware and
Metaware Set-Top Boxes in all potentially profitable customer segments worldwide. The
first sentence in the CSV answers this important question. We want to become the leading
supplier of Hyperware and Metaware Set-Top Boxes. One can define “leading supplier” through
a number of means. Market share leader, although we initially dismissed it as an objective,
does give the company a basis on which to compete. Leading supplier could also mean
“technology leader.” For our purposes, I’ll define this as the #1 or #2 player in each market we
compete in. If we are not within the Top 2 players in each market, we must consider a product
upgrade or hasty retreat to redeploy our resources in markets where can be #1 or #2.
This statement also provides a boundary on where we should look for opportunity. In the future,
the team should be focused on potentially profitable customer segments – avoiding those
markets where competition is so intense that we will be unable to provide a market leading
product and the rewards, if any, are relatively small. I’ll let future managers draw their own
benchmarks here but I’ll offer that being #1 or #2 in a competitive market should provide above
industry average earnings.
2. Leading Set Top Box Supplier means #1 or #2 in each market. Unless we are or can
become the #1 or #2 market, we should exit.
How will we get there? We intend to accomplish this goal by leading the industry in
developing new products, pricing competitively, controlling costs, supporting
customers, and expanding distribution. While I’ll relate each of these tactics to our CSV
later on in the memo, the key takeaway from this statement is that all executives will know how
the team plans on differentiating their company compared to the rest of the industry. In addition,
we can assign each of these areas to managers who are responsible for developing metrics and
monitoring their performance compared to their peer group. At the beginning of each working
session, I recommend a competitive balanced scorecard be presented and contemplated. All of
the members must know what their competitive position is and what their firm’s priorities will
become.
3. Communicate the key competitive differentiators to the team. Assign metrics
formulation and benchmark tracking responsibility to key team players. Provide a
“weekly” benchmarking balanced scorecard.
Why will we be successful? We strive to constantly understand the dynamics of the SetTop Box industry and are poised to move decisively to exploit new market and
technological opportunities when they occur. Although implied by the nature of this
simulation, understanding the dynamics of the industry, markets, and channels is not a given in
this team environment as confusion can reign supreme; market forces must be divided and
assigned. Furthermore, this part of the CSV not only states that the team will be “smarter” than
our competitors by building decision support tools and processes, but also, able to quickly seize
technology as it becomes available.
In my LINKS experience, the implications of technology were easily missed in the “fog of
decision making.” We did not upgrade our products with higher levels of bandwidth, nor did we
invest in technologies that would have allowed us to dramatically reduce the cost of adding
greater bandwidth. This part of the CSV reminds everyone that you are selling a “technology
product.”
3. Strive to constantly understand market dynamics by dividing and assigning
responsibility to team members.
4. Look to exploit new markets and technological opportunities. If you don’t do it, your
competitors will.
The CSV sets expectations for customers, employees, and investors. More importantly, it
guides our product development, manufacturing, and marketing decisions. Let’s examine how a
written “Core Strategic Vision” can play a role in guiding these tactical areas.
Continuous Product Development:
The model CSV stated that “continuous” product development is the first item that will determine
how the company sets themselves apart from their competitors. This is planned because, in my
estimation, product dictates ultimate success or failure. When a firm halts new product
development, their competitive days are numbered. Microsoft didn’t stop at MS-DOS 5.0 and
Intel kept producing Pentiums after the 486’s. Why should you stop? If your company is
focused on generating new products; then, it is focused on providing more value to the
customer. Consumers crave value and the company that embodies value creation through
continuous product development will prosper. In addition, a new product development
philosophy frees your mind from the “fears” of cannibalization. Remember, it’s probably better
to cannibalize your own products than have somebody else do it for you.
While product development is a large investment in the future, it is necessary because it can
help shield the firm from competitive pressure. Specifically in Link-SC, constant product
development helps your firm in the following manner:
1) Firm becomes a patent driver, staking out first mover product boundaries and extracting
economic rents when others follow your efforts.
2) Tastes evolve and competitors advance; upgrading your products keeps you in the game.
3) New product development and upgrades compel your firm to segment markets immediately.
This is increasingly important for long-term competitiveness and success.
4) Although not specifically identified in the research, higher bandwidths, all other things
including price being equal, will drive sales of Set-Top Boxes.
The most successful firms employed constant product development and upgrade regimen
throughout the simulation. For example, the industry leading firm, after producing record results
and far outdistancing themselves from the rest of industry, continued to upgrade their products
and maintained their stranglehold on the industry.
5.
Utilize a Continuous Product Development Process.
5A. Become a “patent driver.”
5B. Sometimes, you have to eat your kids. In other words, cannibalize your
products or someone else will.
Manufacturing:
Like the real-world, LINKS companies will compete mightily for the sale. And, in many cases,
price becomes a major decision point. In order to price competitively and still make profits, it is
imperative that manufacturing costs be controlled and benchmarked against the competition.
Manufacturing costs are primarily made up of component costs and fixed shift costs. Through
production experience, costs can decrease the further one goes down the experience curve.
(Please note that the experience curve resets for major reconfigurations.) For benchmarking
purposes, estimate opposing teams’ product costs by ascertaining the configuration and
tracking competitive sales volume individual product costs and gross margin.
While moving down the experience curve is important, NEVER let your minor cost decreases
gained through experience dictate your product reconfiguration decisions. Falling into this
tunnel vision will result in precipitous decreases of market share and places your firm in
competitive jeopardy. In the model CSV, the product comes before manufacturing and always
takes precedence.
Manufacturing technology investments will play a major role in reducing “bandwidth” costs. To
adhere to the tenets put forth in the Core Strategic Vision to become a product “technology”
leader, investments in “Advanced Manufacturing Technology (AMT)” are necessary insuring
competitiveness and earnings potential. Anticipate the role technology will play in the future and
be prepared to invest in this technology immediately to gain a competitive edge.
6. Keep an eye on product costs. Benchmark your costs to your competitors. Having an
idea of costs can help you determine optimum price points.
6A. Never base product reconfiguration decisions on minor costs savings gained
through the experience curve.
6B. Since being a product technology leader is vital, invest in manufacturing
technology early and exploit the benefits of the technology constantly.
Marketing:
In the LINKS Model Core Strategic Vision, 3 of the 4 P’s are explicitly stated as key competitive
differentiators: new product development, pricing competitively, and expanding distribution. In
addition, these key differentiators show up in the Perceived Quality and Availability rankings. I
wrote these into the CSV because, in a marketing function or a marketing class, one can get too
wrapped up in the traditional marketing silo of promotions. While advertising, mix, and
marketing spending are important, there is much more to consider when crafting a successful
campaign.
Just behind product development in terms of importance, pricing will play a major role in
determining your success or failure. Price a product too high and it will never achieve market
penetration. Price a product too low and you’ll forgo potential profits. Utilize research #33
(Price-Performance Analysis) to determine how to price your product based upon “Perceived
Product Performance.” The most successful products reside in the upper right-hand corner of
the scale, indicating superior perceived performance and exciting financial possibilities.
Place, also known as distribution, can be found in your availability rankings. Generally,
consumers may buy through a multitude of channels with varying degrees of price, quality,
availability, service expectations. The direct channel probably presents the largest margins.
However, substantial volumes are garnered in the major accounts channel. The retail channel,
though dismissed by some as being the least rewarding due to its lower margins, can provide
some value by increasing availability rankings. Consumers like to be presented with more than
one opportunity. Coca-Cola, for example, can be found in fountain glasses, 20 oz. Vending
Bottles, 2 Liter grocery bottles. While some pricing strategies may move people from the retail
channel to higher margins and volumes in the direct and major accounts channel, I prefer
following the Coca-Cola model of distribution and launching in all channels within a given
region. Though overhead costs are increased, a product leader, in my estimation, should be in
all channels of any market worth targeting.
7. In addition to Promotion, remember the other 3 P’s of product, price, and place.
7A. Lead the industry in New Product Development; Upgrade products
continuously.
7B. Product Performance Analysis (#33) can help determine pricing. If you offer
the best performance, charge for the best performance.
7C. Avoid tip-toeing into markets. A market leading product should be launched
and actively sold in all channels.
Conclusion:
To sum up, a properly written and communicated “Core Strategic Vision” will clearly set-up
corporate expectations from the very beginning and facilitate the linking of tactics back to
strategic goals. In a resource and time-limited environment, every process, analysis, and
decision must bring the company closer to its strategic objective. By asking three simple
questions and formulating a brief vision statement, a team can properly focus their energies and
perform at higher levels. Core Strategic Vision – A Cure For Corporate Blindness!
An Excellent LINKS Memorandum
General Managership
Cameron McClearn,
Boston University
I have made one assumption in writing this memo: your group recognizes the need to develop a
management structure with one general manager and you are it. This structure is both efficient
and educational. Because of the time you will spend and the work you will produce, you must
think about and organize the management structure of your group. If you do not, you will not be
successful.
Background
Your LINKS group experience will be unique. You will get to know this group far better than any
other in your MBA career. As a leader, this fact should thrill and intimidate you. You will really
have to manage this group, not just bully people into doing things your way, shout people down in
meetings or be the first one with an idea. As a single person, you do not have the ability to master
the entire game by yourself as quickly as you can with your group.
First of all, everyone in your group will have different skills. These skills come from academic and
work experience, cultural perspective and, now more than ever, geographic orientation. This is
fantastic! Diverse groups make far better decisions than individuals. The more different angles
you explore in making a decision, the better thought out your move will be.
Secondly, everyone in your group will have different expectations about the LINKS experience.
One member may want to get an “A” at all costs. Another may simply want to “get through” the
class with passing marks. Yet another may be uninterested in grades, but very committed to the
learning process. Others will fall anywhere in between.
Third, your diverse group will have competing outside pressures. This is particularly true at
Boston University with its heavy concentration of part-time students who hold full-time jobs. Some
of your group members will have spouses and children making demands on their time. Since this
course is an elective, you’ll also find many students graduating shortly and thinking about postgraduation issues like finding jobs.
Because the professor will have done some pre-screening (i.e., scaring the stuffing out of the
class with stories of how much time is required), you will all have an idea about what the class will
entail and what you will likely learn. This speech should eliminate most people with severe time
constraints. After your first meeting, however, people will want to drop the class because they see
the professor was not kidding. This will be your first management issue.
Finally, the most difficult aspect of the game is that you, as manager, lack any real authority to
make your group listen to you! Take heart, as this is perhaps the most realistic part of the
simulation. They must rely on their ideas, enthusiasm, hard work and persuasion to get others to
support their ideas. This will be your job as a LINKS group manager! Given these thoughts, I
have prepared the following list of “do’s” and “don’ts” for managing your group.
What You Should Not Do
Do not pick the people that will be in your group. This is not the way the real world works and
invariably does not p…
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