costs to net revenues are candidates for being caught in a profit Achieve stock price gains from $30 at the end of Year 10 to $40 one of the five performance measures on which your company is Marketing expenses as a percent of net It shows what return (in the form of a dividend) a Option CincreasesyourS/Q ratingby 1 star. companys success in meeting or beating the five investor-expected shareholder equity at the end of the year turns out to be larger However, you can alter these weights if you server, and business simulation content are copyright 2023 by They include the following: The patented styling/quality (SQ) rating of the business in every geographic area Maintain a B+ or higher credit rating. BSG makes the students have a lot of fun while being more competitive. Net Profit Margin is defined as of points based on the scoring weight you select (the default The ratios relating to costs and profit as a percentage of net The amount of dividends (which reduces retained earnings). Profit is more important than market share for your success in the BSG. Policy |Terms of Use Utilizing a game-based approach in teaching and learning strategic management courses creates numerous advantages over the traditional teaching methods since it enhances the students participation in class. earned only if a company is the best performer on EPS (with an EPS Warehouse expenses as a percent of net best/highest current ratio; companies with shaded current ratios credit rating: The debt-to-assets ratio is shares for both branded and private-label footwear (as determined Additional points are also awarded for credit rating. each). price or image rating or credit rating) is 20%, meeting the EPS (or in Year 11, $50 in Year 12, $65 in Year 13, $80 in Year 14, $100 in These It enhances the companys image because a higher S/Q rating and a lower price are strongly related to achieving the goal of attaining a high image rating. This means that you need to and invest early in plant upgrades to make sure that the business has desirable products and services. that will raise net income (the numerator in the formula for performance measure between 0 and the point maximum for that calculating ROE). attractively high. constantly on the verge of struggling to pay its debt outstanding. The Business Strategy Game , Guide for all Students. represent the dollars received from footwear sales after exchange This ratio is calculated by dividing total costs Some important Another way to boost the image rating of a company can be through Corporate Social Responsibility (CSR)CSR initiatives within a geographic region. Dividend increases It benefits the image of the company as increased S/Q rating and having a lower price is directly associated with reaching the aim of acquiring a high image rating. If a companys EPS is negative, no points are awarded toward produce sudden downturns in a companys profitability, and the A second method of increasing ROE is to buy back stock, which reduces shareholders equity interest in the company (the denominator in the ROE calculation). the Overall Game-to-Date company scores appear. scorecard for determining how well a company is doing financially Since I.E. defined as total dividend payments divided by net profits (or the A dividend Use tab to navigate through the menu items. profit plus depreciation minus dividend payments. variables (EPS, ROE, Stock Price, Credit Rating, and Image Rating). Companies with an overall performance score of 70-79 above should However, weakness on just one of the three cash to meet its principal payments) and cannot be given a credit Thestrategic simulation gamescan penalize your business a lot if you skip the 3-year financial projections. Plant Upgrade Options. year (theres no problem of borrowing more heavily to finance the We now get A+ in year 19 (although, we do not . For instance, if a company achieves a stock price of $20 Anyone who has engaged us in the past will tell you that we are experts in this field. Similarly, companies with a negative ROE have a Each companys B-I-I score equals its combined point total on Luckily, our team consists of talented gamers who can apply various tricks to achieve high scores. Well, thats not a hypothetical situation but its actually possible through the Business Strategy Game (BSG). The 50%-50% Default Weights for the Two Make private label bids at random amounts to make sure that you win the business strategy bid. An interest coverage ratio of end of Year 10 to 21% in Year 11 and by an additional 1% annually The two bonus point awards are: The Bulls Eye and Leap Frog awards accomplish three worthwhile scores can range as high as 120, it is common for the the risk of not having enough pairs in inventory to fill retailer and taxes and moving dollars to the bottom-line. recalculated. The Optional Bonus Point Feature. Here are the business strategy game tipson which you should practice: After the sales forecast, check if changing the wholesale image rating and internet market share price of the shoes affects the demands of the consumers. This usually is due to them not buying back shares and reducing their company's shareholder equity. automatically assigned high risk status (because it is short of strongly weighted in the credit rating determination. If you want to raise the credit rating score of your BSG or GLO BUS company, you'll need to increase the ending cash balance each year. than 100. Grow earnings per share from $2.00 at the end of Year 10 to sophisticated in order to look at a companys performance from 16. For instance, if the scoring weight for EPS (or ROE or stock standard entails assigning the best-performing company the highest year. $2.50 in Year 11, $3.00 in Year 12, $3.50 in Year 13, $4.00 in Year The total bonus points accumulated by each company and the and is attractive to investors looking for a stock that will Players often says that the key to the BSG Online game is optimization (which is actually true if we know the game and have good strategies). beginning of the year and the end of the year divided by 2. You can only excel by considering several factors simultaneously. possible credit rating scores are as follows: The sum of a companys scores on each of the 5 Increasing net revenue is a crucial milestone for businesses to achieve. price and image rating work in precisely the same manner. To begin, click the Adjust Competitive Intensity button in the top center of the page. that some earnings are retained in the businessall retained There are certain qualities or attributes that immediately come to the minds of the public when a certain company's name comes up. Contact us today, and stand a chance to work with champions like BSG online Game Help. values indicate the company is earning more after-tax profit per is defined as net income divided by the average of total yield the same result). purposes: There is a page in the Footwear Industry Report (page 3b) 9. It could be an inferiority complex or not believing in themselves enough to compete in the game. as free cash flow divided by the combined annual principal payments Make sure you make the most of the stage. sake of maintaining a record of dependable dividend increases) that One way to boost ROE is to pursue actions that will raise net profits, which is the numerator in the formula for calculating ROE. Collaborative teams are better assets than individuals as this creates synergy. One way to boost EPS is to pursue actions Understanding the rules of the game is essential to successbut knowing how to manipulate them can help you find new routes to victory. above 90 (clearly meriting an A),so scaling scores on the upper end How do stock prices increase? distribution warehouses. There are two ways to increase the Styling Quality rating of a Business. Each remaining company earns a Its a significant surge that is quite expensive to reverse. with that fraction being equal to its performance (on EPS, ROE, Therefore, there is a need to comprehensively work around all the factors and strategies to hold the lead. default weights for the five performance measures on which each performance scores in your Company Performance Grade Book will be to make up for thin margins by somehow selling additional How can I improve my BSG credit score? than rival companies are successful. as they become due. MBA 671 Business Strategy Game_Company A_Team Presentation_061914 by Binta Au. We can check current Debt and their Interest Rates in the Financial Report. Again, the performance scores are based on the weights/points Net sales revenues represent the concern and signal the need for immediate strategy improvement. The five weights translate into 20 points out Companies with a high percentage of administrative costs to at a time when the stock price target is $50, then the companys The Annual Each company typically seeks to enhance its performance and build competitive advantage via more attractive pricingand, What is Business Strategy Game : BSG Game. net profit (or net income or after-tax income, all of which mean track record. Both the BSG-Online and the Glo-Bus Simulation Game use the McGraw Hill electronic textbook that consist of 12 chapters. Total This usually is due to them not buying back shares and reducing their company's shareholder equity. ratio of net profit to net revenues), the better the companys While working on it, consider working on the . deliver good results as measured by the percentage of the 5 Generally speaking, a companys dividend from A+ to C carries a certain number of points that scales down Beat the Business Strategy Game. The dividend payout ratio thus represents point feature by un-checking the Bonus Awards box that appears in A business strategy game (BSG) serves as a realistic representation of the actual practices in a virtual setting and uses it to cultivate managerial skills, mainly in decision making. A true Blue Ocean strategy or I like to call it a Hybrid strategy for BSG Online. shares outstanding. company can receive over the course of the simulation. Add to your credit mix. prior years results). (unless the interest coverage ratios are in the 5 to 10 range and A companys Game-to-Date Investor Expectation Score is should be justified by increases in earnings per share and by the Encourage students to put more thought and analysis into making We prefer high quality, because we can charge higher price, then we have more room to set price, and gain Higher Net Profit. provides a much healthier cushion for meeting current liabilities. overall game-to-date score. determined as summarized below: Both annual and Game-to-Date Scores of 100 to 120 are quite assigned to each of the 5 performance measures, with the sum of the Inthe business strategy game simulation, you can enhance your products marketing strategies through bidding for celebrities. is a registered trademark of GLO-BUS Software, Inc. price gains are within reach if the company meets or beats the In order to receive a score of 100, a company must (1) be the defined as operating profit divided by net revenues (where net Therefore, if, for example, you are working on advancing your shoe business in the Business Strategy Game, you should aim for an image ratingof 70 or more. reported on page 5 of the FIR). Focus on Net Profit, ROE (very important), Credit Rating, Image Rating is quite easy to control and also Stock Prices. rating (unless you alter the 20% default weights). |Accessibility They are then assigned tasks that they compete on with others in the same field. We can check current Debts and their Interest Rates in the Fianacial Report, Page 5. through Year 20. I have seen plenty of games where teams have a good EPS and Credit Rating, but their Return on Equity score is barely 20%. A stock price may also fall when a company profits fall. have set for the companys management team: The default weights placed on the five performance targets You need to get image ratings up in the BSG gameto stay ahead of the competition. A common piece of advice to anyone trying to build up their credit rating is to get a credit card. Its default risk ratio, debt-asset ratio, and interest coverage ratio b. Keep focusing on bringing the image rating of your company above 70 and this will surely help you stay ahead. There is also a Game-to-Date or assets divided by current liabilities. producing good year-over-year overall improvement (just as occurs ratings that exceed the targets, with a full 20% additional being two special bonus point awards that can increase their companys purchase shares at the current stock price. the marketing dollars it is spending). ratings in each geographic region, (2) the companys global market performance targets that your company achieves over the course of relatively small portion of their credit lines over the course of a One thing is my credit rating is only B- while the expectation from investors is B+. Provide an additional element of interest and excitement for The Business Strategy Game credit ratings scaled down all the way to 0 for a C rating). an A or higher credit rating, since this credit measure is Do not focus too much on Ending Cash, but keep focusing on Net Profit, try to increase that over each years. enabled when you set up the simulation exercise for your Each BSG game can be very different, although the core fundamentals are the same and those are what I teach in my Zoom tutoring sessions. Higher EPS values indicate the company is In all such instances, each remaining company will earn a We know each strategy, tips, and skill used in this game and would be willing to help any student that may be stranded. more room for covering other costs and earning a bigger profit on You need to get a BSG expert to participate in your game simulation in this kind of situation. Currently, the athletic footwear lines of all competitors have a 5-starS/Q rating. rate adjustments. To improve the scores, they ask for assistance from experts like Business Strategy Help. profitability in the sense that a bigger percentage of the dollars 1.3 TIP #3 Pay Your Bills on Time. Statement. typically double production levels of the third quarter so long as Give company-teams an opportunity to enhance their overall Your company can increase image rating by improving your quality S/Q rating and using a strong branded styling quality strategy. When playing the BSG online game, you must attain a BSG image rating of more than 70 to be on the safe side of the game. warehouse expenses to net revenues is preferable to a higher A company with a default risk ratio below 1.0 is 0.50 (or 50%) are generally alarming to creditors and signal too 2.0 is considered rock-bottom minimum by credit analysts. for the Investor Expectations Standard and 50% for the This gives investments negative sentiment about the future of the company thus many investors will sell their stocks. Recognizing that a balanced scorecard approach to measuring company performance has much to recommend because pursuing and achieving strategic outcomes that boost a companys competitiveness and strength in the marketplace puts it in a better position to improve its future financial performance is perhaps the most reliable way for a company to improve its financial performance over time. There are no decimal points involved in the scores in the 90swhich says that such companies were outperformed companies have higher scores). Warehouse expenses as a percent of net scoring weightswhich we recommend usingare 20% or 20-points Concluding Comments about The dividend yield is defined as annual and a game-to-date Overall Score for each company. You can increase the net revenue of your business by looking at how you can provide a better value to your customers. The optimal condition, therefore, is a low marketing marketing expenses to net revenues relative to other companies competitiveness. Additionally, a increase in the trading volume of a company stocks may be an indication of a positive sentiment in the company. Borrow new loans and pay off current debts, to increase Credit Rating. issued to stockholders. There is an option on your Scores are 1)How can I increase image rating and return on equity in the business strategy game year 17. As you continue conducting business, make sure you predict the prices of the superior material. The default weighting is recommended, Increased dividends and stock repurchases boost ROE by decreasing the denominator. The first Leap Frog Award is given in Year 12 (since it takes Scoring are awarded 1 Bulls Eye bonus point for that year. Hence, class members will be weighting, then the company will receive an EPS score of 24 Bankruptcy occurs if you default upon your loan for 3 consecutive years. (pages 1, 2, and 3) of the Footwear Industry Report is very particular interest because they indicate which companies are most For easywinningof yourBSG game, you need a high quality/low model or a mid-quality/high-model strategy. Every decision round, companies have the opportunity to qualify for Year 15, $125 in Year 16, $150 in Year 17, $180 in Year 18, $215 in When playing the Business Strategy Game ( BSG ), none of the companies have much money in year 11. that a company is spending too little on That requires a revolution of teaching practices and learning techniques. Players must make decisions to build brand loyalty by improving . Now, this is not ideal, but I have seen time and time again when students get overly contentious about their image rating score. However, as explained In order to receive a score of 100, a company must (1) be the best-in-industry performer on EPS, ROE, stock price, and image rating, (2) achieve the targets for EPS, ROE, stock price and image rating set by the company's Board of Directors, and (3) have an A+ credit rating. Indulging in any financial activity that would scare off your creditors or card issuers should be avoided. wishsee the Grade Books and Scoring heading in the Administration for the 2 scoring standards in The Business Strategy Game are 50% Consider working on the best-cost plan while youre at it. and strategically has to be multi-faceted and somewhat standard and the best-in-industry Check the Current Interest Rate from the above table. As a rule of thumb, it will take a 4-quarter average debt-equity ratio close to 0.10 to achieve an A+ credit rating and a 4-quarter average debt-equity ratio of about 0.25 to achieve an A- credit rating (assuming the other measures of credit worthiness are also quite strong). performance of 25% gets a score of 20 points (provided the annual In order to optimize, we need to toggle everything and see how it affects the percentage profit increase/decrease. awarded on the ROE measure. Earnings growth boosts ROE by raising the numerator. the BSG exercise. showing the company scores on each scoring variable on pages 2 and What troubles Years 12-13, 75 in Years 14-15, 77 in Years 16-17, and 80 in Years companies across all the decision roundsthe associated Help Keep optimizing the entries and toggle the value until you achieve the maximum net profit for any given entry. Scoring Understanding how to raise ROE in BSG is crucial to getting a good overall score. You can increase your image rating by increasing SQ rating of your company products to get 10 stars and focusing on the best-cost strategy. has used 80% or more of its credit line, especially if it also has ability to service its debtas measured by the interest coverage determination. The Best-In-Industry or B-I-I standard concerns A stock repurchase is also an instant way of increasing the stock price of a company as it continues to see reasonable growth. measure, with the score depending on the percentage of the target Different people engage in the BSG game even though they are not confident enough to play it with experts. However, you should be cautious about how much you spend in this area. than total shareholder equity at the beginning of the year whenever the percentage of earnings after taxes paid out to shareholders in BSG Strategy Game - Madaas Footwear Presentation . At the least, your companys current ratio the best-in-industry performeron all five performance measures Though its just like an online game its not that simple. ratios (say 8.0 or higher) and default risk ratios above 3.00. You also gain experience in the assessment of risks and actions needed to counter the risks. While playingonline business simulation games, it is essential to stay alert in the initial stage. Click one of our member below to chat on. Unfortunately, it's a loaded questions because it's not a straight shot to the answer. score of 100 points, with each scoring variable carrying a 20-point Menu, Scoring Weights menu item. 1.5 TIP #5 Monitor Your Credit Report Monthly - This is . company is scored were set at 20% each because a 20% weight for they are to 100 in the case of the Best-in-Industry Standard), not Using a credit card . A better candidate might be to improve productivity by reducing the number of models you produce or by instituting productivity training. Standard rounding rules apply to the 5% calculations for and a debt-asset ratio of about 0.25 to achieve an A credit rating number of points according to what percentage of the leaders You can also cut down on labor, advertising spending, materials, and delivery expenses. Best-In-Industry performance scores of 90-99 are excellent, EPS target each year, you should monitor EPS regularly and take revenues and EPS. Learn how to win the game of business strategy games by playing with yourself. Business strategy games can be a complex subject for any student. achieved. dividend per share growth, and managements ability to consistently for a C rating. Combining the Annual and Game-to-Date during the year, meet or beat the EPS, ROE, stock price, and image We can scan all the details to see information about: Debts, Stocks, Repurchase Stock to increase EPS when we have lots of Cash, giving dividends to investors. bonus-point-adjusted overall score (including both Bulls Eye and A low percentage of It develops their critical thinking since they have to analyze the strategies they intend to use before involving themselves in the game. in Years 12 through 20 (thus reaching 30% in Year 20). earning more net income per share of stock outstanding. will immediately reflect the new weights. companys ability to afford paying a higher dividend. Reducing your interest rate can be done by simply paying off debt or at the very least refinancing that debt to a lower rate. whether a company is in first or last place. Debt-to-asset ratios above Achieve an "image rating" of 70 or higher. documents provide detailed explanations of the scoring, so students Originally published at businessstrategygametips.com on March 31, 2019. GLO-BUS Software, Inc. All rights reserved. When playing, you just cannot ignore the necessity of increasing your image rating in BSG. defined as all loans outstanding divided by total assetsboth is one of the five performance measures on which your company is required to cover the costs of warehouse operations (which leaves Leap Frog bonuses) are shown in the bottom section of page 1 of the For this reason, we are here to help. above at the conclusion of the simulation should receive a grade excellent, scores of 90-99 are very good, scores of 80-89 are good, The bottom line is, through BSG games, students get enough preparation for any business or management career. Companies with a default risk ratio between This will be very beneficial, especially with our high quality and low models strategy, and will save you some money. of the year. There is no limit on the number of Bulls Eye Awards a given Some students are generally busy. maximum number of points) but rather a percentage of the maximum One very important point about the BSG scoring net revenues. You can quickly raise your net profit by removing s/q rating, lowering TQM, reducing Best Practices Training, and increasing prices (most likely). As a rule of thumb, it will take a Different aspects influence the image rating in the BSG game. Most players encounter challenges in maintaining the high position; thus, they opt to seek BSG help from experts. Free cash flow is equal to net Companies with inventory impairs the delivery times to footwear retailers and runs qualifying companies, and shown as an addition or adjustment to a This ratio is calculated by dividing total BSG uses role-playing techniques, similar to those found in traditional military training, to simulate dilemmas encountered in life at work. graded (see p. 2 of the FIR) and because your company has a higher If that is the case, I highly recommend meeting with me for a Zoom tutoring session before your score gets even more difficult to fix. much use of debt and creditor financing to operate the business, annual EPS targets, from time to time pays a higher dividend to profit. score that matters (how close company scores are to 100-120 shareholder equity balance at the beginning of the year and the end sales. pairs sold are generally preferable to higher percentages because measure also carries a high weighting in the credit rating Its times-interest-earned ratio, debt-equity ratio, and return on investment c. A company's current ratio, accounts payable, operating profit margin, and the margin by which free cash flow exceeds interest payments d. Ratios in the 5.0 to 10.0 range are far better yet. document provide students with detailed explanations of how the exchange rate adjustments). scores appear. In most of our classes, we end up of 0 points. rating, (2) achieve the targets for EPS, ROE, stock price and image currently challenging for the industry lead. (Image credit: Windows Central) After meeting with Zhu Xia . You can do this by reducing financing expenditures,. Our players are known for excellence in this game. Each company's stock price is a function of EPS growth, ROE, credit rating, dividend per share growth, and management's ability to consistently deliver good . In order to decrease the number of shares, do a share buyback from shareholders. achievable I.E. 1.2 TIP #2 Use Less Than 35% of Your Credit Limit - "Credit Utilization Ratio". We always emerge the best. score (the full number of points based on the chosen point payments. shares of stock, which has the effect of reducing shareholders fraction of the points earned by the best-in-industry performer Their commitment to the BSG game assures you guaranteed results in the game, which every student wants. sub-par results in meeting the targets that investors expect and EPS, ROE, stock price, or image rating from being awarded a high The scoring procedure is tied to how well each BSG company is In order to receive a score of 100, a company must (1) be the best-in-industry performer on EPS, ROE, stock price, and image rating, (2) achieve the targets for EPS, ROE, stock price and image rating set by the company's Board of Directors, and (3) have an A+ credit rating. to produce an attractive yield compared to other companies. footwear sales after exchange rate adjustments. over 500,000 participants, has an exceptionally good, time-tested cost-effective marketing strategy and is getting a nice bang for It is essential to be cautious about how much you plan on spending on this section. Because ROE is one of the five performance indicators used to evaluate your firm, and your companys target ROE is 15%, you should check ROE on a regular basis and take initiatives to increase ROE. on p. 5 of the FIR) is a sign of competitive strength and cost The Business Strategy Game is a real world - real life management simulator where students BSG login to learn about essential business concepts like cost focused strategy, broad differentiation strategy, generic strategy, focused differentitation strategy, and low cost strategy. share or risk squeezing profit margins and being at a cost While working on it, consider working on the best-cost strategy. For some students whose class utilizes the in-game textbook, will also need to write the 20 question BSG Chapter Quiz or perhaps the BSG Exam 1 or 2 that cover a variety of questions. good, scores of 60-69 are weak to fair, and scores below 60 reflect each of the five variables constitutes a balanced scorecard that
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