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Company Code

NN

ERP SimulationERP Simulation

Group 4 Section B OM-II

Company Code

NN

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ERP ECCS

Contents

Questions

Sales growth %

NPM Cumulative

Financials and market share

Snapshot

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Snapshot

Effectiveness & efficiency

Session 2 and 3:Winning strategy

Beginning Session 2:Change of strategy

Session 1:Strategic misfit &

a learning point

Jump from 17th rank to 5th

Avoiding stock outs & activeBuying and selling

Less marketing expense & sellingat market rates

Extensive marketing & high prices

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NPM Cumulative (%)

0

5

10

15

20

25

Q1 Q2 Q3

Adjusted Market (%)

NN (%)

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Team &Functions

Critical functions

Finance: Aditya

System Specialist:Vikas

Procurement

Continuousordering (JIT)

Avoid stock outs No holding cost No ordering cost

Handled by Jayant&Tanmay

Sales

Market prices Inventory levelsCoordination with

procurementteam

Price Maintenance:Shubham

Market Analysis:

Akshat

Active Management

Overall Strategy: Akshat & Jayant

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Market Share (%)

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4.7

95.3

Quarter 1

NN

Others

8.4

91.6

Quarter 2

NN

Others

8.1

91.9

Quarter 3

NN

Others

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Improved Profitability - Corrective Steps

Tried various combinations of marketingexpenditure and selling price

Started Q1 with high prices and marketingexpenses

After day 10, reduced marketing expenses minimal impact on sales

Beyond Day 14, reduced selling prices tomarket level upswing in sales and resultantstock out

Conclusion Market was price sensitive andmarketing had low impact on sales

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Q3 strategy

Continuoustracking of

inventory levelsand daily sales

report

Selling belowmarket price and

minimal marketingexpenses

Dynamic inventorylevel management

Initially higher toavoid stock out

and then lower insecond half of

quarter to avoidholding costs

Pro active decisionmaking (ahead of

market) Marketprices reduced

towards day 15.We reduced prices

two days inadvance

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Ideal Q1 Strategy

Ideal-High selling price

-Low marketing

expenditure

-Wait till second half of

quarter forinventory level

of other players to

diminish

Q1

Strategy

Information

forAnalysis-Day by day sales

report in the quarter

-Marketingexpenditure %

-Financial

Statements

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Reasons for revised strategy

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Led torevisedstrategy

Lo sales

Negativenet incomeand margin

High levelsof

outstanding

inventory

NegativeReturn on

Equity

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Company Code

NN

ERP ECCS