Board Meetings
The following information is intended to be a written guide to complement our class discussion. In each of the following sections you will find information on the various aspects of the project.
StratSim Performance (20):
Scores for the actual simulation will be determined by a combination of financial and market based indicators as well as some weighting for momentum/change. This will be a balanced scorecard approach. I will provide these scores as soon as possible.
StratSim Strategic Plan and Presentation (20):
In terms of assessments, I will give equal weight to the plan and the presentation. However, since the content of the presentation is based on the plan, content is implicitly worth more than presentation.
Plans should follow the outline below and be no more than 10 single spaced pages excluding exhibits and tables. They are due on Dec 1. Management teams are also invited to use any information gained from their Board presentations to improve their final plans.
Strategic Plan
Executive Summary
This should be a high level overview of the report (not just an introduction) including the key internal and external issues plus the ‘major’ objectives and the ‘major’ strategic initiatives as well as the ‘major’ performance outcomes that achieving the plan will deliver. Use key performance indicators (ROI, capacity utilization, etc). This section can be several pages long (single spaced) and is very important. Write this section last.
Vision
Please provide a brief vision statement
Situation Analysis: Point form is fine
Internal Assessment -- include the use of the Resource Based View (VRINE) to assess your firm’s resources and capabilities.
You may also use the following suggestions to help the Board and me understand your firm (and any additional data you want to include).
Tables that address the evolution of your firm (Period 1 till now) for each of the following indicators will be helpful: a) vehicles actively produced/sold, b) technology, c) capacity, capacity utilization (%) and total inventory ($ or days), d) development centres – how many and how used, e) market performance (market share for each vehicle), and financial performance (such as liquidity, debt to assets, asset turnover, gross margin (%), ROA, stock price and firm preference.
If you set these up as tables with each period (1-7) as a separate column and each indicator as a row, it will be easy for me to see your firm’s evolution. Add any additional tables you feel helpful.
External Assessment -- include relevant information on the general environment and the use of any relevant aspects of Porter’s Five Forces Model to assess opportunities and threats. This should, at a minimum, include an assessment of industry segments, trends, and rivalry in those industry segments in which you are, or are planning to, compete.
Objectives for the Firm for the Upcoming Two (2) Years
These objectives should be specific, measurable and attainable. This section represents where you want to be for each of the next two years. This should include such things as your targeted market share, stock price, firm preference, etc. A simple table will facilitate this. Please include at least one year of historical data in this same table.
Strategies for the next Two (2) Years: Point form is fine.
This section will include a presentation/justification for your business strategy as well as the individual functional strategies needed to reach the targets you set in the Objectives section (above). Use the strategy diamond as an overview (some sections will have little content but others may have more).
Within the broad outlines you’ve noted, briefly go back into the individual products. If you plan to enter or expand into new arenas, these product-market strategies should be identified together with your justification. Changes to other existing strategies should also be noted – increasing capacity, modifying your capital structure, modifications to marketing, etc.
Strategies should be supported. The use of research data from StratSim is strongly encouraged.
Metrics
This section should include income statements and balance sheets for the last actual year of the simulation and pro formas for each of the two years of the plan. Please organize these so that the Board can quickly see the evolution from actual play to what you plan to achieve in each of the two years. Please ensure that the targets you set for Years One and Two (above section) are reflected in the pro formas. Please make sure to provide sufficient footnotes to these statements so that the Board (and I) can follow your logic and assumptions. Please pay attention to justifying where the numbers come from for your sales forecasts – you may do this in the plan itself, or as a table to support your pro forma. Either way, the Board and I will want to know what the sales figures are based upon. The simulation doesn’t provide much detail about the balance sheet so Year 2 can only be done using your best estimates.
Please send a rough draft of your plan to your Board (and me) by midnight, Sunday, Nov 20. This rough draft need not have an executive summary. When you’ve sent your plan to your Board, you can also send your passwords to the Board so that they can continue to develop their due diligence to help them get ready for the meeting.
Presentation
The presentation should be no more than 30 minutes and should include an oral report of the strategic plan including an opportunity to review your projected financials in some depth. The Board will have an opportunity to discuss your performance (as reflected in your Internal/External assessment) together with their own due diligence – described later. We should target a maximum of 45 minutes for the presentation and Q&A. In the event of any problems, we will have a little cushion so that the next team can still get access to the room and set up while still staying on schedule. We can’t afford to run behind.
Not all team members need to present the plan. Non-presenters are expected to contribute to the overall project in ways that their team-mates consider equitable and to be present should the Board wish to ask them any questions.
The presentation should be formal, professional and use standard software such as PowerPoint. Given that this is a fourth year course, it is expected that no presenter will need to rely excessively on their notes, etc. Please wear business attire. All presentations are in one of the two Boardrooms on 2nd floor Schwartz. A schedule will be posted on my door.
Please bring hard copies of the ‘final’ presentation to the meeting for members of the Board and me.
Board of Directors (10)
As Directors, you are responsible for representing the shareholders and hence must be willing to do your advance preparation and constructively assess the current status of the firm and its plans for the future. Boards should recognize that the Management team are their firm’s most senior employees and represent the future of the firm. Management should be treated with respect.
To assist you in this role, please take the opportunity to more fully understand your Management team. Prior to coming to the presentation, please prepare a very brief summary (maximum of 3 pages excluding exhibits/tables) of Management’s current situation including what you consider to be their key strengths, weaknesses, opportunities and threats. Please also add a small section that provides a rough idea of what kind of strategy you think that Management ‘should’ employ in the next two years based on your assessment of where they are at the end of the Simulation. Only a few paragraphs are needed for this.
By midnight, Sunday, Nov 20th, send me a draft version of your due diligence report. By midnight, you will have also received Management’s passwords. Once you’ve received these passwords, you can deepen your due diligence by looking at confidential information in the Management team’s account.
At the time of the Management presentation, please provide me with a final copy of your team’s due diligence report (this should still be a short, concise document). I will use this document, together with your questions, comments and feedback to Management to assess your role as Directors. I expect that all of your team will contribute to the discussion. I encourage you to prepare questions in advance (based on your due diligence) as well as ask questions and make suggestions based upon the actual presentation, itself. It is not necessary to find ‘flaws’ in the presentation and plan. It may turn out that there are few. But it is necessary to ask questions to get a full understanding, to clarify issues and to explore areas that you think might need further work. Following the presentation, the Board will be asked to convene and complete a Management Advice form. In this form, you will have an opportunity to make recommendations to Management if you think such recommendations are needed. A form will be provided at the meeting and a sample is attached below. Remember, the key task is to decide if you agree that the plan makes sense for the firm’s shareholders – you are not doing a performance appraisal of the team, just assessing the plan.
Peer Evaluation
At the conclusion of the Management and Board presentations and the preparation of the Strategic Plan, I will ask each student to submit a confidential peer assessment of their team-mates. As noted in the Course Outline, peer evaluations are taken seriously and can result in an individual student receiving a higher or lower grade than other team members. For these reasons, all teams are strongly encouraged to be as clear as possible as they approach the rest of this exercise especially in terms of:
Who is responsible for what tasks?
What level of performance is expected?
When is the work to be completed?
These confidential peer evaluations (forms are attached) are required. Your assessment of your colleagues’ contributions should include work during the term, as well as the work required at the end of term. Peer evaluations should be submitted during our last day of class.
Business Administration 471
Board of Director’s Assessment of Management’s Strategic Plan
Board Identifier:______Management Identifier: ______
Based upon our preliminary review, Management’s presentation and our subsequent discussion, Management HAS our support to implement their strategy AS PRESENTED.
Based upon our preliminary review, Management’s presentation and our subsequent discussion, Management HAS our support but we direct Management to address the following concerns.
Based upon our preliminary review, Management’s presentation and our subsequent discussion, Management DOES NOT have our support to implement their strategy. We therefore direct Management to revise their strategy. Our concerns relate primarily to the following issues:
Business Administration 471
Confidential Peer Evaluation
Your team code identifier:______
Your Name:______
Team Membership:Score out of 100:
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Total*______
The Total score should be equal to 100 points multiplied by the number of team mates you have including yourself. For example, if you are in a group of five, you will score five people and your total score should equal 500. How you allocate these points among the team is your decision. If everyone contributed equally throughout the term, you would give each person a score of 100. You might consider this exercise to be a performance appraisal to allocate a year-end bonus.
Comments: Comments are required any time you score a student below 80 or above 120. These comments should be brief but they are very important. Comments should address performance deficiencies and be specific – not general.
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