Business Strategy Game
The Business Strategy Game is an audio-visual sport that simulates real-life business. When playing this game during my group’s project, I was able to realize how concepts learned in class affect the success of the business. In particular, the game showed the relationship between price and demand and that prices of items are affected by both the internal and external forces in a business.
With regards to the relationship between price and demand, I noted that items have different price elasticities. In this case, the decrease in the prices of items result in different variations in the demand levels. On the overall, I observed that a decrease in the price of an ordinary item leads an increase in its demand. Similarly, an increase in its price leads to the decline in demand. During the business strategy game, I saw that once our group reduced the price of one of the items we were selling, their demand rose. Once the price of the same item was increased, the demand levels fell. Therefore, our group aimed at ensuring that the prices of the items were positioned in the most profit optimizing points; the level where the relationship between price and quantity results in the business making most profits.
The Business Game Strategy also showed me the importance of customer care service in the success of a business. In real life, businesses offer various customer services such as free transport to their customers, which make customers to prefer their services. Just like it occurs in normal business operations, I observed that my group would have been able to attract more customers by giving them incentives such as free transport.
In the Business Simulation Game, I also observed that a business is affected by both internal and external forces around it. This concept is similar to what I have learned in class. For example, an increase in the marketing efforts by our competitors made my group’s company to have low revenues. Similarly, a decrease in the price of competitor’s products caused the number of items sold by the company to reduce. The changes in the business due to the external activities of competitors showed me that a business performance is also affected by external forces. Importantly, I observed that internal forces, such as the management’s decisions determine how an organization performs. For example, an increase in marketing efforts made the company to have more sales.
During the simulation tasks, there are various activities that we did right, which enabled our virtual company to have an excellent performance. In particular, the group examined the actions of competitors before deciding on its next strategy. This process was based on the realization that external forces affect the performance of a company. Accordingly, we enhanced our marketing efforts to counter the activities of competitors. For example, when competitors lowered the price of their products, we increased our marketing efforts and at times also lowered our prices. This tactic enabled us to have a large market.
Another correct activity that we did was expand our operations to new markets. The expansion to new markets was in response to the fact that our local market was saturated. Due to the aggressive behavior of each seller, we had all reached a point where we could not lower the prices of our products further. Moreover, there was no any additional market for new products. The expansion to new markets was similar to the strategy done by ordinary businesses of moving to new unexplored potential markets. This expansion of the business operations to new markets made us find new clients for our products.
One of the wrong decisions that our group made during the Business Strategy Game was the concentration on the short-term benefits of making huge profits over the long-term gain of having a sustainable business. The group’s virtual company did not use environmentally friendly material since they were expensive and made it have a high operating cost. Instead, it preferred low-cost materials that were not environmentally friendly. In practice, businesses should be responsible and sustainably conduct their operations. The use of plastic materials for our packaging would, in the long run, make the company unpopular, which would make it lose a considerable portion of its customers that are concerned about the environment. The failure to offer free shipping was another mistake that the group made. In the current competitive business environment, businesses must provide various incentives to their customers for them to use their products. The failure to give free shipping made the company unable to win many customers in its foreign markets.
From the Business Strategy Game, I was able to gain a lot of lessons on how to run a successful business. In particular, I learned that a company must be responsible and ethical by caring about the effects of its operations on its customers and the environment. I also learned that a company should be concerned about the internal and external forces affecting its operations. In this case, it should establish appropriate systems for managing its operations. These strategies may include tactics on marketing, purchasing, and recruiting and training of workers. Similarly, it should form proper strategies to counter the actions of its competitors.