Strategic Choices Simulation

Strategic Choices Simulation

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Improving a business or product’s performance depends on the suitability of the applied strategies that could entail altering its price, costs and deciding the products to retain and those to discontinue. In that view, this simulation seeks to test decision making regarding Clipboard Tablet Co. The simulation begins with the year 2011 and proceeds with decision making over the five years from 2012 to 2015 (Ekart & Nemeth, 2005).

The company develops tablets, and the objective is to maximize the three models cumulative profits over the five years period. The models include X5, X6, and X7. Further, it is notable that X5, has been in the market for three years, and the customers are not currently worried about the performance. On the other hand, X6 has been on the market for two years, and the customers care about the performance and not the price while X7 that has been on the market for one year, customers are worried about the price and performance. In line with the business decision-making model, the information indicates that X6’s R&D can be changed without the fear of negative reaction from customers given that they would not be worried by the resulting effect on the product’s performance (Forman & Selly, 2001). It is also an indication that changing the R&D of X6 would have a substantial impact given that it would affect the performance that customers are concerned with. However, changing X6 price wouldn’t have much impact given that customers are not worried about its price. Finally, it is an indication that the change in the price of X7 as well as its R&D wouldn’t have a substantial impact as customers are not concerned about its price and performance. To begin with, the current (year 2011) performance in sales for the three models were $X5; 968,979, X6; 562,961 and X7; 0. Also, by the year 2011, the profitability for X7 is zero, while that of X6 is $37,579, 840 and that of X5 is $43,991,298. Thus, the Joe’s profitability was 16% at $81,571, 138. Finally, it is notable that the R&D costs are $24,000,000. It is also notable that the market is marked by 15% market saturation with about 6,000,000 remaining customers. That provides a substantial market to be captured given that even the repeat customers are few compared to the one time buyers.

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