Capstone Project on "Profit Analysis Is a Tool"

Quoted Instructions for "Profit Analysis Is a Tool" Assignment:

SCENARIO CONTINUATION:

It*****'s New Year*****'s day, 2010. You just had a great New Year*****'s Eve celebration, you finished analyzing the performance of Handheld and are ready to charge ahead into the future. As you turn on the TV and try to open your eyes, you notice something strange (again). The TV commentator is saying something about New Year*****'s Day, 2006. You have a sinking feeling, and sure enough, it*****'s back to 1/1/2006. You realize that you are in Time Warp 2.

This time you decide to do your decision making differently. You are going to use a technique that you became familiar with last year, CVP analysis. And you are going to decide all of your decisions at once. No feeling your way through it this time. You are going to make all of your decisions now, for the next four years and just cruise through it this time.

You analyze the results of your first set of decisions that you made in Time Warp 1, from 2006 to 2009. You have the data, you kept it all. But now you are going to use CVP analysis to help you determine your new strategy. And you have a tool to use, the CVP Calculator.

You analyze the results using CVP and develop your complete four year strategy. You decide to make notes about your analysis and your reasoning process, just in case you have to do this again (You are praying that you can finally move ahead this time when you get to 2010.)

You finish your report that shows your strategy that you are going to use these next four years during Time Warp 2. And stop and take a big breath before you move ahead into 2006.

(In other words ***** don*****'t run the simulation, yet. Just turn in this report.)

SLP3 ASSIGNMENT: Review and analyze the results that you got in SLP2 (Time Warp 1 decisions) and develop a revised strategy. Write a report and make a case for this new strategy using analysis and relevant theories.

SLP3 Expectations: The revised strategy consists of the Prices, R&D Allocation %, and any product discontinuations for the X5, X6, and X7 PDAs for each of the four years: 2006, 2007, 2008, and 2009. You must present a rational justification for this strategy. In other words, you must Make a Case for your proposed strategy using financial analysis and relevant theories. You need to CRUNCH some numbers (CVP Analysis) to help you determine your prices and R&D allocations. Make sure your proposed changes in strategy are firmly based in this analysis of financial and market data and sound business principles. Present your analysis professionally making strategic use of tables, charts and graphs.

TIME LINE SUMMARY

SLP1

2009: 12/15 hired. 12/30 turned in first report to Sally a few days early. 12/31 ***** celebrated

SLP2

Time Warp 1 begins: 1/1/2010 WARPS INTO 1/1/2006

You freak out, then realize you have to make decisions for 2006 ***** 2009, which you do.

12/31/2009 ***** you have gone through all four years, and you write your report to summarize how you did. You are hoping that you will wake up tomorrow and it will be 2010.

SLP3

Time Warp 2 begins: 1/1/2010 WARPS INTO 1/1/2006 (Again)

Now it*****'s 1/1/2006: you decide to use CVP analysis and develop a four year plan for your strategy. You analyze the results of your first decisions in Time Warp 1 and make notes. You use the CVP Calculator to help you develop your strategy and you make more notes explaining your logic and your analysis. Then you take a short breather before you start in again tomorrow.