in Expresso, 29th of June 2013
The 2013 Edition of the Global Management Challenge presents a new version of the Simulator, for the teams, that has made the competition more complex and realistic.
The 448 teams entering the 2013 Edition of the Global Management Challenge have been using a new version of the Simulator, with new decisions. The first round of the competition has ended and some participants doing a comparison of the previous and present-day version consider the new one more complex and closer to reality. The Organization of the competition, in conjunction with its partners Edit 515, created a new version of the simulator that began to be used first in Portugal and will now be adopted by more than 30 countries.
In this version, new decisions are present: the possibility of outsourcing the production; the training of employees; there are more ecological concerns and companies can issue shares. The evaluation of performance has also changed and now the goal of the participants is that the company obtains the best investment performance. This criterion reflects the value of the company to the investors. This is not only the market value of the company, but includes the value of any dividends paid or repurchases of any shares less the cost of any shares distributed to them.
Before and now
Vasco Rodrigues from the EDP UCP Porto team has participated on the challenge in previous years. “The main differences can be found in the shorter period over which certain decisions are implemented, in the issuance and share buyback and dividend distribution in all quarters”. The competition is closer to reality and more complex, especially by the inclusion of environmental costs, the value of the factory land and shareholder control, and the outsourcing for the of components production.
The new Simulator brings also new lessons. Vasco Rodrigues says that now it has “a clearer and more rational perception of importance of the different variables on performance of the invested capital. Still, in the field of differences, Barbara Marques, from ALUMNIGMC/TLBMEL team adds that “The presentation of the information has improved. The current disposal and segmentation of data by theme is more interesting from the visual viewpoint and facilitates the processing and analysis of the company and market information”. She believes that the competition became more attractive, that the management of the company gained wider scope and decision-making has another complexity, generating more debate and adrenaline within their team.
Greater realism
Barbara Marques has already participated in several editions of the Global Management Challenge. She explains that now, and for example, in the case of production, the introduction of the possibility to outsource is a novelty in line with reality, since it allows the alternatives to the productive process apart from the in house machining. The possibility of working the company net worth, as a source of financing activity or as a form of application of funds is also closer to reality.
The aforementioned complexity is corroborated by Martinho Bernardes from CGD-Molicieros team that has participated several times in the Global Management Challenge. “With the introduction of new variables, it has become more complex to anticipate the moves of opponents. The break-even point is much more uncertain leading to stricter adjustments on company’s strategy throughout the game. During the first round, he explains, the main difficulties experienced by his team were the pricing, issue or buyback of stocks and whether it was better to invest in machinery or subcontract”. Martinho Bernardes tells us that “the versatility of strategies to adopt and new decisions, in this new version of the Simulator, are undoubtedly the main lessons to learn from this edition of the competition”
