Software Vault: The Gold Collection/Software Vault - The Gold Collection (American Databankers) (1993).ISO/cdr02/fernv120.zip/PROGRAMS.ZIP/MANUAL.TXT

Text File | 1993-06-13 | 146KB | 2,706 lines

                           " FERNDALE  FASHIONS  LTD "


                  (A Strategic Management Business Simulation)

                       Written by Ben Leppington, CIM, RPA

                     Copyright (c) 1992  All rights reserved



                                STUDENT   MANUAL












































                                    CONTENTS


     Preface                                                             (i)

     Chapter 1
                Introduction                                              1
                On line History                                           1

     Chapter 2  DECISION MAKING FEEDBACK                                  2
                Feedback on your decisions immediate                      2
                Feedback on your decisions month end                      2

     Chapter 3  USING THE MODULES                                         2
                [FINANCE]                                                 3
                  A/R and A/P Management and Policy                       3
                  Balance Sheet                                           3
                  Changes in financial position                           3
                  Debt                                                    3
                    Line of credit                                        3
                    Short term loans type #1                              4
                    Short term loans type #2                              4
                    Mortgages                                             4
                    Misc. credit                                          4
                  Investment                                              4
                    Short term investments type A                         4
                    Short term investments type B                         4
                    Short term investments type C                         4
                    Bonds                                                 4
                    Preferred Stocks                                      4
                  Income statement                                        5
                  Ratios                                                  5
                  Print statements                                        5
                [MARKETING]                                               5
                  Franchise fee                                           5
                  Product prices                                          6
                  Promo                                                   6
                    Television                                            6
                    Radio                                                 6
                    Printed Media                                         6
                  Projections                                             6
                [PRODUCTION]                                              7
                  Capacity                                                7
                  Equipment                                               7
                    View equipment                                        7
                    Buy equipment                                         7
                    Sell equipment                                        8
                  Inventory                                               8
                  Output                                                  8
                  Suppliers                                              10
                [PERSONNEL]                                              10
                  Bonus/Raises                                           10
                  Demotions                                              11
                  Discipline                                             11











                  Feedback                                               11
                  Fire                                                   11
                  Hire                                                   11
                  Promote                                                12
                  View                                                   12
                    Records                                              12
                    Organizational Chart                                 12
                [OTHER]                                                  13
                  Advance using date                                     13
                  Competitor profile                                     13
                  Customer profile                                       13
                  Economic and Environment profile                       13
                  History of the company                                 13
                  Mini-Cases                                             14
                  Supplier profile                                       14



     Chapter 4  GETTING STARTED                                          14
                Read the on-line histories and profiles                  14
                Determine the corporate goals                            14
                Prepare a SAP                                            15
                Prepare a ETOP                                           15
                Identify and lay out your strategy                       15
                Begin the implementation process                         15
                Examine results and modify implementation or strategy    16
                Completion of the Simulation                             16



     APPENDIX
                Installing the Program onto a hard drive                 A1
                Creating data disks                                      A1
                Products to Produce worksheet (Form #1)                  A1
                Sales Revenue and Production Costs worksheet (Form #2)   A2
                Proforma Income Statement worksheet (Form #3)            A3
                Proforma Balance Sheet worksheet (Form #4)               A3
                Proforma Statement of Changes worksheet (Form #5)        A3
                Management Decision Journal (Form #6)                    A4
                ETOP (Form #7)                                           A4
                SAP (Form #8)                                            A4
                Strategic Planning worksheets (Forms #9 - #12)           A4
                President's Annual Report to CEO (Form #13)              A5
                Financial Ratios                                         A5
                Forms 1-13 (blank)





















                                     PREFACE

               This software program is for students of management and those
     who will be  interested in strategic management.  It provides the user
     with a hands on feel for some of the variables involved with managing a
     business.  The intent of the program is to provide an environment where
     instant feedback is given in direct response to your decisions.
     Theoretical recommendations normally used with text book case studies
     of some fictitious or real company cannot be tested or applied with the
     old fashion text book method.  With 'Ferndale Fashions Ltd' you can now
     test your theories and get instant feedback as to whether your
     decisions were correct or not.  You also get the real challenge of
     being responsible for every aspect of the company.
               Unlike other management simulation software, 'Ferndale
     Fashions Ltd' was designed as a single user program.  I believe that
     whenever a software program calls for a group to make decisions, a sort
     of group-think mentality becomes apparent.  Another danger to members
     of a group participatory simulation software program, is the individual
     who is the more domineering or boastful of the group.  This leader will
     convince the others that his decisions are the correct ones.  This
     leaves some of the participants out in the cold and not satisfied with
     their simulation experience on a personal level.  There is plenty of
     time and opportunity in life to learn how to work together as part of a
     cohesive team.  I take the position that early on in a student managers
     development and especially with case studies, you need to see a direct
     cause and effect response from your own decisions, not those of someone
     else.  A manager needs to learn their own style of management and it is
     nice to experiment with your own ideas.  This simulation program is the
     ideal environment for such experimentation and serves as a safe place
     to exercise your new management knowledge and skills.
               This program represents many months of hard work and every
     effort has been made to make the program FUN!  I have endeavored to
     take the simulation to a level of detail that will get you right into
     it.  The many thousands of algorithms required to make the program as
     close to real life as possible was a challenge.  The program cannot
     duplicate real life of course and if it could no one would be able to
     afford it's sales price or have the room to store the boxes full of
     data bases required to duplicate every possible occurrence that would
     face a manager over the course of a year.  The program will give you
     control of and allow you to cover the basics of management ie:
     planning, organizing, directing, scheduling, staffing, asset control
     and more.  Also, even though this simulation takes place using a
     clothing manufacturing plant, the decision making process and strategic
     planning involved is transferable toward many businesses.
               The simulation involves the user being hired on as President
     of the two year old company by the CEO and owner of the firm.  You will
     have full control over every aspect of the company including finance,
     marketing, production and staffing for a period of one year.  The
     organization of your decisions will be of prime importance, as if you
     forget something or neglect warning signs, as in the real world, there
     will be a price to pay for your mistake.  You may  be challenged by
     this program and your decisions will have immediate and or long term
     consequences.  You will also be faced with a monthly mini-case from
     within the simulation and these mini-cases will test your management
     skills, ethics, social responsibility and judgement capabilities.  You




                                       (i)






     will be tempted to stray from your original goals and strategies as new
     opportunities or threats present themselves to you.  You have been
     hired to turn this struggling, cash-flow poor company around within one
     year.  Can you do it?  Do you have the right stuff?  I want you to feel
     on the one hand the excitement and power of being a manager as well as
     the fear of what a bad decision can do on the other hand.  But most of
     all I want you to have fun and enjoy using this simulation program.
               What is the best strategy?  There are many successful good
     strategies, one will not necessarily be better than another.  A
     successful strategy is one that follows a strategic management system.
     Correct interpretation and evaluation of the environment, economy and
     the threats or opportunities it presents with a matching of the
     company's internal strengths and capabilities within that environment
     will be of prime importance.  With every decision you make, think about
     whether that decision is in line with the corporate objectives of the
     company.  A hap hazard approach coupled with poor planning is a sure
     way to put the company into bankruptcy.  Addressing the true causes for
     the company's current problems early on in the simulation will help a
     great deal, failure to identify what these problems are and the correct
     approach to their resolution will cost you plenty, you may even have
     your first management failure before the next 12 months are up.  If
     you do have a management failure don't feel bad, not everyone is a
     winner the first time out on the track.  If you learn something from
     your failures, YOU are not a failure.  Most successful people have
     experienced failure many, many more times than they have experienced
     success.
               The instructor, if this program is used as a college training
     exercise, will collect all printable reports or statements for the
     completed 12th  month of operations as well as the completed worksheets
     that come with the program (located in the appendix).  The instructor
     should then examine your work and check to see that you have indeed
     used a strategic management approach towards the simulation and have
     documented your decisions in the journal.  The higher the retained
     earnings on the 12th month the better your performance.  Or, the
     higher the net income is the better.  This does not mean that your
     decisions should be bottom line effect only?  As, you will be penalized
     for making decisions that are unethical, immoral and that are not in
     the best interests of society.  As an example, if you decide to
     sacrifice the environment in order to receive higher revenues, you will
     be penalized based on the seriousness of the situation.  You will also
     receive bonus points for making good decisions.  Bonus/Penalty scores
     will be shown at the end of each mini-case's completion.  You can use
     the [SHIFT] + [PRINT] key combinations to get a screen print of the
     scores.
                So, to provide an easy method of determining an overall
     better strategy over one that is solely bottom line profit oriented.
     You will add the net effect of the bonus/penalty points to
     your net income as follows.  Multiply the net value of the total
     bonus/penalty points by 10,000 and add this value to your net income.
     Ie:  If your net bonus/penalty score is negative 10.  Multiply -10 *
     10,000 =  -100,000,   so, you would deduct $100,000 from your net
     income figure for the year.








                       (ii)






                                    CHAPTER 1

     INTRODUCTION.

                Welcome to the 'Ferndale Fashions Ltd' business management
     simulation.  You are indeed privileged to be in a position to
     experience this relatively new method of management training using a
     computer to facilitate instant feedback on your decisions.  The user of
     the program will be given the opportunity to make decisions and see how
     they impact on the company.
                You will see how each component of a company with all of
     it's operating departments work together and how they are dependant
     upon one another during the implementation process.
                In this simulation, I have designed the program to look at
     as many variables as practical to create real reactions.  As an
     example variables involved with sales volume determination include the;
     economy, availability of replacement goods, your products price,
     quality of goods produced, how much you spend on advertising, your
     salesman's ability to close sales, your capacity to produce and or
     service the sale, time requirements, demand for your product and a few
     others.  Within the simulation as a whole there are thousands of
     comparisons and algorithms used to provide the "realness" of the
     program.  Not everything can be examined and included within the
     program, but I feel the net results provided by the program in response
     to the decisions and strategy you use will be appropriate for the
     purpose intended.
                It is a good idea to evaluate the current situation with the
     company.  Determine what the strategy should be, make all of the
     desired changes right away and then hold many of the variables
     constant while playing with a few others.  It is easier to measure
     which changes are working when just a few variables are changed or
     experimented with at a time.  By changing just a few at a time you can
     see which revenue and expense elements are providing the desired
     results.
                In brief, your company is only two years old and has grown
     at a very fast rate.  A garment manufacturer that uses a franchise
     distribution system to move their products.  Please read the on-line
     history files available to learn more about Sara Ferndale, the company's
     history, the economy/environment, customer profiles and more.
                The program itself is menu driven and is easy to use.  Drop
     down menus are available for Finance, Marketing, Production, Personnel
     and one called Other which contains the on-line history files and of
     course other options.  Within some of these drop down menus, sub-menus
     are available for certain options.
                The first thing you should read is the install procedure to
     place the program on your hard drive as well as create a master working
     data disk to store your data files.  Install procedures can be found in
     the Appendix.  The second item to read would be the history files and
     the various profiles that are available on-line.










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     ON-LINE HISTORY AND PROFILES:

                The history of the company as well as profiles of the;
     competition, customers, economy and suppliers are all available on-
     line.  They can be found by selecting the [OTHER] option from the main
     menu of the program.  Use the information provided within these files
     to aid in the preparation of your strategic plans.  There should be
     enough information within the history and profiles in order to identify
     company goals and objectives as well as to prepare a SAP (strategic
     advantage profile) for the company and to prepare an ETOP
     (environmental threat/opportunity profile).  Read these files first
     then prepare the SAP & ETOP, before you make any decisions.

                                    CHAPTER 2

     DECISION MAKING FEEDBACK:

     Immediate feedback:

                The program has been designed to show the effect of some
     decisions immediately.  This feedback would include certain obvious
     moves such as buying a piece of equipment, investing in stock or bonds,
     hiring/firing staff, bonuses, raises, securing debt and more.
     Basically, most decisions that are not sale volume related will
     automatically be reflected into the various financial statements
     immediately. As an example, if you purchased a piece of equipment, cash
     would be credited and the equipment asset account would be debited
     immediately.  Revenue (sales) and expense calculations (depreciation)
     will not be shown until you use the Advance Date option.

     Monthly feedback:

                By using the Advance Date option located within the OTHER
     main menu selections, the program will look at all of the decisions and
     changes you have made for the month as well as the default positions of
     every aspect of the company and calculate the revenue/expense items for
     the month.  You can print out any of the available financial statements
     for any period at any time as well as view a current set of financial
     statements, ratios etc on your video monitor.

                                    CHAPTER 3

     USING THE MODULES:

                Pressing the cursor arrow direction keys will move and high-
     light the main menu options.  While a main menu option is highlighted,
     you can drop down an options menu by pressing [ENTER].  The first option
     on the drop down menu will then be highlighted.  Using the up/down cursor
     arrow direction key will scroll  and highlight the options.  When
     an option is highlighted, you can select this option by pressing the
     [ENTER] key. Sub-sub-menu options can be selected by pressing the option
     number only or by pressing the option number following by pressing the
     [ENTER] key.  This latter procedure usually is required when option
     numbers are greater than a single digit.  Ie: to select option 14 you
     would type in a 1 and a 4 and then press the [ENTER] key.  Any sub-menu





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     that has more than 9 options available will require this procedure.

     [FINANCE]

     ACCOUNTS RECEIVABLE/PAYABLE MANAGEMENT:
                You have complete control over the company's receivable and
     payable policies.  Unlike other simulation programs, I have allowed a
     real world flexibility concerning what policies you would like to use
     for these very important aspects of the company.  You have complete
     freedom to set policy for both a down payment requirement with sales
     as well as when the balance due is expected.  For an example, if you
     want to set company policy that requires a 10% down payment with sales
     orders and the balance to be received in 1, 2 or 3+ months from the
     date of sale, you can.  The same applies to accounts payable.  You can
     create policy only during the first month.  Once set, it will be used
     for the duration of the simulation!            Be careful with your
     payable policy, if the company is too delinquent or your payable become
     too high the suppliers will cut you off!  Franchise fees and the bulk
     stock ($34,970 ea) that is sold to a new franchisee will be collected
     immediately and are not governed by the A/R policy.


     BALANCE SHEET:
                From the FINANCE main menu option, selecting Balance Sheet
     from the pull down menu will display the current year-to-date balance
     sheet on your video monitor.  To see past period balance sheets, you
     will need to print them out using the print option of the main menu.

     STATEMENT OF CHANGES IN FINANCIAL POSITION:
                Selecting this option will display the current changes in
     financial position statement.

     DEBT:
                Selecting this option will bring up a sub-menu which
     displays 6 options and include Line of Credit, Short Term Loan type 1,
     Short Term Loan type 2, Mortgage, misc. forms of credit available and
     exit.  To secure credit the bank will examine your financial statements
     and make a decision based on your current credit worthiness.  If your
     ratios are not up to par or if your overall financial condition is too
     risky, they will reject your application for credit.  The monthly
     payment on these loans will be automatic by the program and will vary
     depending upon the amount and type of loan.  Each type of loan carries
     a different lending rate and is based as a percentage over prime.  The
     prime rate for the life of the simulation is set at 10%.  Once a loan
     has been secured, it cannot be paid out early.  The lender requires a
     repayment period of at least one year.

     Line of Credit:
                You can make arrangements with the bank for a $500,000 line
     of operating credit at any time during the simulation.  If your cash
     balance ever reaches a negative number of -$200,000  YOU WILL GO
     BANKRUPT !!  and the simulation will end.  The bank draft will hedge
     your cash balance by 1/2 a million dollars and will buy you some time.
     If your cash balance is positive, a repayment of overdraft used will be
     made when using the Advance Using Date option.





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     S/T Loan type #1:
                You can apply for a loan up to $100,000.  The interest
     charged is set at 3% above prime and some plant equipment will need to
     be pledged as collateral.  Repayment of principle and interest will be
     automatic and monthly with 10% on principle and the balance of the
     payment will comprise the interest.

     S/T Loan type #2:
                You can apply for an unlimited amount of money with #2
     Loans.  Whether you get what you apply for will depend upon your
     current credit rating.  Interest will be set at 4% above prime and
     repayment of principle is the same as type #1 loans.

     Mortgage:
                You can mortgage the company's buildings and land.  The bank
     will lend up to 75% of the appraised value.  Interest will be set at 2%
     above prime and the monthly payment will be $3,446 with only $346 going
     towards principle each month.  Misc. Credit:
                You can secure various forms of non-secured credit ie:
     company credit cards etc.  The maximum amount that can be secured is
     $50,000 and this credit is easy to get.  No collateral is required.
     The interest rate on this form of credit is 22% per annum with a 10%
     repayment of the outstanding balance plus interest required each month.

     INVESTMENT:
                 Selecting this option will bring up a sub-menu that
     displays 6 options; S/T investments type A-C, Bonds, Corporate Stocks
     and exit.  The investments available range from 6% below prime interest
     bearing 100% Government of Canada insured and guaranteed investments to
     a 2% below prime interest bearing 40% chance of loosing your investment
     type.  All investments are not locked in and can be cashed-in at any
     time by using a negative number.  Investment type A:
                This investment type pays interest at 6% below prime and is
     fully guaranteed by the Government.
     Investment type B:
                This investment type pays interest at 5% below prime and is
     guaranteed by the Government at a rate of 60% of your total investment.

     Investment type C:
                This investment type pays interest at 4% below prime and is
     not guaranteed by the Government.  However, these investments are very
     safe and the likelihood of loss is very low.

     Bonds:
                This includes numerous types of bonds available on the
     market and are considered safe investments.  No government insurance or
     guarantee is available on these bond investments.  Bonds will pay
     interest at 3% below the prime rate.

     Corporate Stocks:
                This investment includes all types of preferred and common
     stocks available on the market.  A stock broker will decide where your
     money is to be directed and what your portfolio will consist of.  These
     investments are highly volatile and you have a 40% chance of losing all
     or part of your investment on any given month.  The revenues received





                       4





     from stock investments are compared to the prime rate and will pay on
     average the highest rate of interest which is just 2% below the prime
     rate or 8% per annum.

     INCOME STATEMENT:

                Selecting this option will display a year-to-date income and
     expense sheet.  To see past period income statements you will need to
     print them out using the Print option.

     RATIOS:
                Selecting this option will display 4 columns of ratios.  The
     first column is for the year 1990.  The second column is for the year
     1991.  The third column is the current year-to-date ratios.  The forth
     column is the Industry Standard ratios.  The main category of ratios
     include those for; liquidity, leverage, activity and profitability.

     PRINT STMTS:
                This option is used to print out the Balance, Income,
     Statement of Changes in Financial position statements as well as the
     year-to-date ratios.  You will be presented with a sub-menu for the
     Balance and Income statements and have the option of selecting the
     year-to-date statements or you can print a statement for any previous
     month.  The Changes and Ratio statement is restricted to the year-to-
     date default.  Also, if you want to print any of the other reports or
     listings contained within the other main menu options simply hold down
     the [SHIFT] key and press the [PRINT] key while the report is up on the
     video display monitor.  You will receive a screen print of whatever is
     currently displayed on the screen.

     [MARKETING]

     DISTRIBUTION:
                Selecting this option will merely display a short text
     indicating Ferndale's distribution method.

     FRANCHISE:
                Selecting this option will bring up a sub-menu; view, price,
     graphic and exit options are available.

     View:
                Selecting this sub-menu option will display the franchises
     sold to date.  The address, town and province as well as which salesman
     sold the outlet, including the franchise fee collected will be shown.

     Price:
                Selecting this sub-menu option will allow you to set the
     franchise fee the company wants for selling an outlet license to the
     franchisee.  The franchise fee can be changed at any time and once set,
     will act as a default price until changed.  It is important to note
     that when a franchise is sold approx. $35,000 (wholesale price value)
     of product inventory is also sold to the new franchisee.  This volume
     is controlled by the program and you have no control over that.  You do
     have control over the price each garment is sold for however.






                       5





     Graphic:
                Selecting this sub-menu option will graphically display the
     locations of all franchises sold to date on a map of the western
     provinces.  It's not high tech graphics, so don't get too excited.


     PRICE:
                Selecting this option allows you to set the prices for the
     eleven different product categories the company manufactures and sells
     to the franchisees.  The price can be changed any time and once set, it
     will act as a default price until changed.  The display will also show
     a complete break-down of the products costs to produce including
     material costs, labour to produce the item, your wholesale price and
     the franchises retail price, which is based on your wholesale prices.

     PROMO:
                Selecting this option will bring up a sub-menu that provides
     three main advertising mediums; television, radio and printed media.
     You can use one or a mix of all mediums and each medium will sell air
     time or ad space at different rates.  This option will "book" your ad
     or air time but will not automatically charge your cash account for the
     ads.  You will pay for the advertising when the month has been rolled
     over using the Advance Date option from the [OTHER] main menu option.
     The simulation program will provide instant feedback for the booked
     advertising however and if the projections option is viewed the booked
     advertising will be taken into consideration for these projections.
     The promo values are zeroed out after the Advance Date has been
     executed, so you must evaluate your advertising and book new air-time
     or ad space each month.  The bookings of the previous month will not be
     used as a default for future periods.  You must re-book each month.

     PROJECTIONS:

                Selecting this option will display the marketing departments
     projected sales of both potential franchise outlet sales as well as
     individual franchise product sales volume.  Total demand for franchise
     outlet sales that could be sold is based on numerous factors including
     the level of advertising expense, economy, franchise fee, number of
     sales people, salespeople's skill level etc.  While the actual
     projected franchise outlet sales (as shown on the righthand side of the
     screen) will be restricted by one additional element.  This extra
     element is the time constraints required to actually complete an outlet
     sale and construct the leasehold improvements etc.  The maximum number
     of franchises that can be sold in any month by a single salesperson is
     two.

                You may wish to play with the variables and elements that
     influence marketing and try to match the marketing mix to that of the
     companies capabilities.  A balancing act of these elements will produce
     optimal performance.  Spending too much on advertising for example can
     be a waste of money.  Advertising creates interest in Ferndale's
     products and to a lessor degree for it's franchise outlets as a
     business opportunity.  An over abundance of franchise outlet interest
     is wasted if you do not have the salespeople required to close the
     outlet sale or the capacity to produce the products that could be sold





                       6





     due to the extra interest created through advertising.
                By evaluating your goals and insuring that you have the
     physical capacity to meet those goals together with a marketing mix
     that is sound, your goals will be realized.
                One item to note on the franchise outlet sales volume demand
     projections (as shown on the lefthand side of the screen) that may
     throw you off, is that projected demand for franchise outlet sales is
     influenced by the number of and skill level of salespeople you have on
     staff.  The reason why demand does not remain the same no matter how
     many salespeople you have, is due to the fact that salespeople perform
     marketing/advertising activities that are in addition to your regular
     advertising campaigns.  These franchise salespeople are by no means
     just order takers, they must work hard to help create demand for the
     franchise outlets.  Advertising creates interest, but salespeople close
     sales and create real demand not just interest.  That is why the
     "CURRENT STRATEGY COULD SELL" projections will decline or increase in
     relation to the number of salespeople on staff.  The "CURRENT STRATEGY
     COULD SELL" projection will never be lower than the "FERNDALES'S
     ABILITY TO SELL" projection, but it can be higher.  In other words, the
     only difference between the franchise outlet demand projection and the
     company's ability to sell that many outlets is due to the time
     constraint element.


     [PRODUCTION]

     CAPACITY:

                Selecting this option will display a line of text that will
     tell you what the current capacity to produce is based on the equipment
     held by the company.  This is not to say that you will produce this
     amount as if you have fired your Production manager or some other event
     will cause your actual production capability to be reduced.  Also, the
     capacity to produce for each piece of equipment will decline over time
     due to wear and usage.  The value of this decline is based on the level
     of depreciation for each piece of equipment.

     EQUIPMENT:

                Selecting this option will bring up a sub-menu.  The sub-
     menu will display 4 options; view equipment, buy equipment, sell
     equipment and exit.  You have complete control over the assets of the
     company and can buy and sell equipment as desired.

     View equipment:
                This option will display a list of all the company's plant
     equipment, it's capacity, it's purchase cost and it's book value.

     Buy equipment:
                This option lets you buy equipment on the open market.
     Equipment for sale will show it's type, capacity and cost values are
     displayed.  No credit is available through the equipment seller, so you
     must pay for the purchase immediately.  That is not to say that you
     cannot get a loan from the bank first then go back and buy the piece of
     equipment.





                       7





     Sell equipment:
                This option allows you to sell existing equipment.  The
     amount that you can sell the equipment for will be for the purpose of
     this simulation, based on the current book value for a particular piece
     of equipment.  So, no gain or loss will be realized on the sale of
     assets.  Certain assets can not be sold and you will be informed of
     this if you try to sell them.  Selling equipment may be advantageous if
     a replacement can be purchased that will provide a greater capacity for
     less money invested.  Careful analysis of current equipment verses
     those available for sale will be required to make an informed decision.

     INVENTORY:

                Selecting this option will display the setting for minimum
     inventory levels for each product, raw materials inventory as well as
     the actual level of inventory you have on hand right now. This option
     also provides you with a means of setting a minimum inventory level to
     maintain at all times.  Minimum inventory levels provide a buffer
     between production time requirements and delivery lag time of raw
     materials.  For the purposes of this simulation, you will not want to
     keep too much money tied up in inventory as stock will be sold down
     only to the level of the "minimum stock on hand" that you select.
     Most Japanese manufacturers try to keep inventory levels down to the
     absolute minimum with unusually high inventory turnover ratios.

     OUTPUT:

                Selecting this option will enable you to provide instruction
     to the Production Department.  You will, on a monthly basis fill out a
     "Products to Produce" order form.  This will let the production
     department know how much raw material to buy and how many individual
     products to produce for the month.  You will use the projections
     received from the marketing department in order to fill out this
     production order.  You have complete control over how much to produce
     and a careful look at your cash, accounts payable, accounts receivable,
     sales projections, inventory levels and how many new franchises will be
     sold that month will help you make informed decisions.  Once you have
     completed the order form, the program will tally up the costs for raw
     material purchases and provide you with an option to modify the order
     or proceed to file the order with the production department.  The
     prices used to calculate the raw material costs will depend upon which
     supplier you have decided to use that month.  The program will warn you
     that it will use the currently selected supplier to fill the order and
     provide you with an escape route to go back and change suppliers if you
     wish.  If you, for some strange reason, forget to place a "Products to
     Produce" order with the Production Department in any given month, the
     program will provide you with a remingder to do so.    The raw material
     and finished product inventory levels will change in accordance with
     your ability to do the job.  The actual stock items that are sold with
     a new franchise are:
     Pants: Mens          150
     Pants: Womans        250
     Pants: Boys          140
     Pants: Girls         160
     Shirts:Unisex        400





                       8





     Skirts               100
     Jackets: Mens         80
     Jackets: Womans       90
     Jackets: Boys         50
     Jackets: Girls        40
     Handbags              30
                      -----------
                        1,490 garments

     It is important to remember these quantities when placing your monthly
     "Products to produce order".  You will need to not only calculate the
     monthly volumes required for existing franchises, but will have to add
     the extra garments listed here to your order.  New franchises that will
     be sold in the current month will not be included when calculating the
     total sales volumes for the current month.  Instead, you must multiply
     the projected sales volumes available by the number of current existing
     franchise outlets, then add the bulk inventory that is sold with each
     new franchise together with the regular volumes.
                As an example, suppose that the marketing department has
     indicated that 8 franchises will be sold this month (Use the
     [MARKETING] main menu then select the sub-menu [Projections] ) and you
     currently have 32 franchises outlets (not including the 8 that will be
     sold this month).  You will calculate a "Products to produce order" as
     follows:
                     Individual   # of        Total       Bulk      Products
     Product         Franchise    Existing    For         Sale         To
                     Volume       Franchises  Franchises  Volumes   Produce

     Pants: Mens        90   X    32      =  2880     +  1200    =  4080
     Pants: Womans     151   X    32      =  4832     +  2000    =  6832
     Pants: Boys        98   X    32      =  3136     +  1120    =  4256
     Pants: Girls      112   X    32      =  3584     +  1280    =  4864
     Shirts:Unisex     254   X    32      =  8128     +  3200    = 11328
     Skirts             65   X    32      =  2080     +   800    =  2880
     Jackets: Mens      43   X    32      =  1376     +   640    =  2016
     Jackets: Womans    48   X    32      =  1536     +   720    =  2256
     Jackets: Boys      29   X    32      =   928     +   400    =  1328
     Jackets: Girls     23   X    32      =   736     +   320    =  1056
     Handbags           17   X    32      =   544     +   240    =   784
                      -----     -----      --------     ------    ---------
     Total Units       930        32       29,760      11,920     41,680


                So, from the summary above it has been established 41,680
     units of clothing will have to be recorded on the Products to Produce
     Order form to meet the products needs for the current month.  A
     "Products to Produce Order Form" can be found in the Appendix.  Just
     photocopy as many copies as you need.
                You will also have to make sure that you can produce 41,680
     units by checking your company's capacity (use the [PRODUCTION] main
     menu and select the [Capacity] sub-menu).  If the Capacity is lower
     than the volume being ordered, you need to purchase some more
     equipment.  If you cannot afford to buy more equipment, you will have
     lost sales.






                       9





     SUPPLIERS:

                Selecting this option will provide you with an option to
     select raw material purchases from three separate sources.  You can use
     one or all three at the same time for various raw materials.  The only
     restriction is that you can only use one supplier for each type of raw
     material purchased.  IE: use supplier #1 for material A, supplier #2
     for material B, Supplier #2 for material C and supplier #3 for material
     D.  Or use any supplier for all the material types that you require.
     The quality of each fabric that the supplier sells is also displayed
     and is an important component.  Suppliers will know through credit
     checks how much you own other suppliers so don't be fooled into
     thinking that you can charge up purchases for three months with one
     supplier and then change suppliers to begin a new cycle of credit
     purchases.  Generally, the suppliers will grant credit for purchases up
     to a maximum of $1,000,000.  If you owe more than a million dollars to
     raw material suppliers in total and your accounts payable policy states
     that you will pay suppliers in say two months, forget it, you will be
     cut-off from any further purchases until the account is made current.
     Don't let your payables get out of hand or you will lose an entire
     months worth of sales due to poor accounts payable management.  This
     will not make your creditors, franchisees or Sara Ferndale very happy.

     [PERSONNEL]

     BONUS/RAISES:
                Selecting this option will provide you with a means to give
     deserving managers a bonus or a raise in pay.  Depending upon the value
     of the bonus or raise the manager will be made more happy with their
     job and the company.  It is important to note that if a particular
     manager is unhappy due to an underlying cause, bonuses and pay raises
     will act as a temporary fix or a band-aid solution towards the
     employees declining unhappiness.  If the true problem with the employee
     is not known, bonuses and raises will prevent the manager from quiting,
     but it will cost more to keep them happy using bonuses or raises over
     the long haul.  Simply select the record number of the manager to be
     given a bonus or raise and enter the dollar value of the bonus or
     raise.  It is difficult to simulate non numeric value rewards such as
     intrinsic rewards, so the program does not contain any.  I am not
     suggesting that a monetary reward is the only or best method to
     motivate or reward an employee for a job well done or to increase an
     employees overall happiness with the company.  If an employee is
     incompetent within their job, the stress from their inability to cope
     with their position will remain no matter how many raises or bonuses
     you give them.  The program uses dollar values to deal with bonuses and
     raises to overcome an employees declining happiness values, but a
     promotion may also cure what's ailing an individual who has a high
     skill level and is in a lower level managerial position or is being
     paid a wage which is too low.  Promoting an employee may be the wrong
     decision for someone who is incompetent in their current position.  How
     can you determine what is wrong with an employee?  The Feedback option
     will provide memos sent to you by the employees.  By examining the memo
     which will be presented in short one line condensed versions, you can
     tell what the problem is.  The value of bonuses are recorded to the
     ledger account Bonus and Benefits immediately.





                      10





     Demote:

                Selecting this option will enable you to demote an employee.
     Demotions are not always a negative thing to do to someone.  If an
     employee is incompetent within their position, a demotion will
     alleviate the long term stress that is causing their unhappiness and
     cause only a temporary increase in their present unhappiness until they
     readjust to the new position, which they are capable of handling.
     However, if in the example above, a demotion is deferred too long, the
     added stress of the demotion will push them over the edge and the
     employee might quit.
     knowing the signs of when an employee is in over their head will help
     you to realize when a demotion is preferred over added bonuses or pay
     raises to try to cheer up an incompetent over stressed employee.


     DISCIPLINE:

                Just as you can give bonuses and pay raises you can give
     discipline to an unruly employee.  Select this option and identify the
     employee to receive the discipline.  Enter the value of the discipline
     to be given and press enter.  In the same way that rewards are given a
     monetary value even though the reward could be intrinsic, discipline is
     recorded in monetary values as well.  The discipline could be intrinsic
     as well, without a true monetary value, but program restrictions
     require that a monetary value be used for all disciplinary action.  The
     value of such discipline is credited against the Bonus and Benefits
     expense account.

     FEEDBACK:

                Selecting this option will provide you with current feedback
     from your managers.  The feedback takes the form of condensed memo's
     that come straight to the point.  It is important to monitor the memo's
     to get a feel for who is in the right position and what action needs to
     be taken to address each individual memo.  It is important to read your
     managers memo's every month.


     FIRE:

                Select this option to fire a manager.  It is unlikely that
     you would want to fire very many of the existing staff members, but if
     you view it as a logical decision that is required, the option to do so
     is available to you.

     HIRE:

                Select this option to hire new staff members.  There is a
     cross section of salesman, production managers, garment designer,
     marketing experts, financial managers, personnel manager etc.  You can
     select likely candidates from a list.  This list shows their
     background, skill levels and the asking salary they would want to come
     on board and work for Ferndale.  You are free to adjust their pay scale
     up or down once they are hired.  Depending upon their qualifications,





                      11





     practical experience and skill level, you could successfully re-
     negociate a new salary with them.  But, if the new salary does not
     compensate fairly for those above mentioned attributes compared to the
     industry standard, they will become unhappy and you will have to deal
     with that.

     PROMOTE:

                Selecting this option will enable you to give an employee a
     promotion.  When a manager is promoted, they will move up the ladder
     one step.  The wage and remuneration package will automatically be
     given to the promoted individual based on the industry average for such
     positions.  Ferndale has not promoted anyone since the inception of the
     company, so the wages paid to the current managers are considerably
     lower than the industry standard.  If you promote anyone they will
     receive a considerable pay increase.
     Ferndale has identified the following levels of management and provides
     enough steps to keep highly skilled managers on the company's payroll
     for a long time:
                          Vice-President
                          General Manager
                          Assistant Manager
                          Supervisor
     Once someone has been promoted and have gone from $30,000 per year to
     say $50,000 per year, you can still adjust their salary downwards.
     Although to do so would cause unhappiness in the individual.  A
     balanced "fit" between the employee and the job is required.  The
     minimum skill level required to be a supervisor is 5 with one
     additional point required to be comfortable within the job.  So, a Vice
     President would need a skill level of at least 8 and preferably 9 to be
     comfortable within the job.  Anyone who has a skill level that is lower
     than the requirement for the job will become unhappy.  Anyone who has a
     higher skill level than their current position demands will also be
     unhappy.  If this decline in happiness is allowed to continue the
     happiness value shown in the employees record will continue to decline.
     Sure, bonuses and pay raises will temporarily increase well being and
     happiness levels, but if the value indicated for the employees
     happiness drops too low, they will give warning and quit their jobs.


     VIEW RECORDS:

                This selection will bring up a sub-menu; view records or
     view the organizational chart.

     View Records:

                The view records will display information on each manager
     individually.  The record is basically a payroll record that shows
     their address, experience, skill level, and annual salary level etc.
     You can flip through them one at a time.

     Org. Chart:

                The organizational chart is just a graphical representation





                      12





     of where the managers fit within the company.  Only those with general
     manager statis will be shown along with specialty positions that are on
     par with GM's statis, ie: a clothes designer or personnel manager if
     hired would be depicted on the organizational chart.

     [OTHER]

     ADVANCE DATE:

                Use this option to advance the using date ahead to the
     beginning of a new month and to have the program assess and calculate
     the months transactions based on the decisions you have made for the
     month.  When you first begin using the simulation, you are on January 1
     1992.  You can make all the decisions you want, which basically sets
     the defaults for the way you want the month to proceed.  Once you are
     happy with the decisions you have made, you will advance the using date
     which will execute the operations for the entire month integrating the
     decisions you have made for that month.  All revenue and expense
     accounts concerned with the accrual operations during the month will be
     calculated and posted when the "Advance Date" option is executed.  You
     will given a WARNING screen when this option is chosen from the menu
     and you will have the opportunity to escape at that point.  If you do
     not escape from the WARNING screen, the monthly roll over and
     calculations will be made.  You cannot go back and rework a month once
     it has rolled over into a new month.  There are a lot of calculations
     being performed during the Advance Date process and it might take a few
     minutes to complete the process.  You will not be allowed to advance
     the using date until you have completed the required monthly mini-case.

     COMPETITORS:

                This is one of the environmental historical text profiles
     available on-line.  These profiles are useful in preparing strategic
     plans and general information about the industry.  These text files are
     in point form, making them brief and concise.

     CUSTOMERS:

                Another on-line text profile that you should read and can go
     back to for reference during the course of the simulations.

     ECONOMY:

                Yet another on-line text profile that you should read.

     HISTORY:

                This is an on-line text file, which outlines briefly the
     history of Sara Ferndale and the company's progress up to the time of
     your being hired on as the new Vice President.  This is a must read
     file.









                      13





     MINI-CASES:

                Once each month, you are required to make decisions
     involving a min-case.  You must complete a decision on the monthly case
     in order to advance the using date forward into the next month.  The
     mini-cases involve certain opportunities or possible threats as well as
     other items that managers could face.  Each case has an exit to think
     about option that will afford you the time you need to evaluate the
     case and the consequences of the various options that are presented to
     chose from.  Some cases will have more options available than others
     and you may not agree with any of the possible options that are
     available, so try to pick one that will produce the desired result even
     if you don't agree with the reason presented with the option.
                Your selection of an option to handle the mini-case will be
     graded.  You will receive bonus points for good decisions or penalty
     points for not so good decisions.  Bad decisions that are solely bottom
     line or profit orientated that have the possibility to hurt the
     environment or others will be penalized.  At the end of each min-case a
     Bonus/Penalty summary screen will be shown.
                The general approach is to make all the decisions you want
     to make for the month then proceed to do the mini-case and finally
     advance the using date to finish the month off.

     SUPPLIERS:

                This is another on-line text file which profiles the raw
     material suppliers available.


     CHAPTER 4                   GETTING STARTED

                The first step of course is to install the program files
     onto your hard drive and make a master data disk as outlined in the
     Appendix.  Then read the history/profile text files within the program.

     Read the on-line History files:

                You will need to read the history and profiles for;
     competitors, customers, economy, suppliers and the company's history in
     order to get a feel for the industry and the company that operates
     within this industry.  The information contained within the profiles
     and history are used to prepare a SAP and ETOP, which is discussed in
     detail below.


     Determine the company goals:
                Without goals the company will be like a ship floating
     aimlessly towards no particular destination.  Failure to identify
     company goals is a plan for disaster.  As without goals you have no
     base to build from.  How do you know what implementation process to use
     if you don't even know what you want?  How can you determine if anyone
     is doing a good job if there are no quotas to be filled?  What business
     are you really in?
                You will need to write a short paragraph that describes
     concisely what business this company is in.  You will need to write





                      14





     down the corporate goals you wish to achieve with this company.  Be
     specific with the goals ie: to increase sales by 50% during this year.
     To ensure that 30 more franchises are sold this year.  To increase net
     after tax profits by 10% this year.
                You may need to downsize or upgrade these initial goals once
     you have completed the strategic management planning process and when
     the feedback is received through the implementation process.  These
     first round goals are at least a starting point.

     Prepare a SAP (Strategic Advantage Profile):

                The company you will be managing has within it's structure
     certain advantages or strengths.  You must be able to identify and
     evaluate a company's strengths and weaknesses in order to take
     advantage of environmental opportunities or to avoid certain threats
     that will influence your company's destiny.  If you do not know the
     strengths and weaknesses, you will not be in a position to recognize
     how your company will be affected by the environment.  This will cause
     you to make bad decisions and will eventually lead to bankruptcy.
     Other problems with committing the company to a contract that the
     company simply cannot meet can be avoided if you know it's strengths
     and weaknesses.  A SAP would examine such internal factors as;
     corporate resources, personnel, finance and accounting, production,
     operations management, R & D, marketing and distribution.

     Prepare a ETOP (Environmental Threat/Opportunity Profile) :

                The ETOP examines such external factors such as;
     Socioeconomic, Technological, Competitors, Suppliers and any
     Governmental implications that may affect the company.

     Identify and lay out your Strategy:

                Once you have identified your company's mission or
     objectives, examined it's internal strengths and weaknesses and compare
     that to the environmental threats and opportunities, you are now ready
     to identify HOW you are going to accomplish the company goals.  How are
     you going to achieve these goals?  The implementation part of strategic
     planning is the usual planning, organizing, staffing, control
     directing, schedualing, budgeting, reporting etc that is normally
     associated with management.  Use the strategy worksheets found in the
     appendix to identify your strategies.


     Begin the implementation process:

                This company already has an implementation process in place,
     but is it a correct process?  After you have evaluated the SAP and ETOP
     together with the CEO's objectives for the company, you may want to
     adjust certain aspects of the current implementation process to better
     meet the objectives of the company.  Prepare projections for
     the entire year and break this annual projection down into monthly
     projections.  Know in advance how much equipment you will need to buy
     along the way, know how many franchises can be sold and plan for it.
     Know ahead of time how your going to deal with a cash crunch etc.





                      15





     Examine actual performance and modify implementation or strategy:

                To remain efficient and on track, the individuals in charge
     of strategic planning will periodically evaluate operations feedback
     against corporate goals to see if the implementation process or the
     goals themselves need to be adjusted.  Unrealistic goals that have been
     made with little thought towards the company's strengths/weaknesses or
     real ability will cause wide gaps between the goal and the actual
     performance.  Modify your implementation process or strategy:
                Upon evaluating the current implementation process over a
     period of time, you will know if the current strategy is working or
     not.  Gaps within certain aspects of the company will be noticed.
     These gaps if negative will need to be addressed.  The hard part is
     knowing which variable within the company is the weak link.  Not giving
     enough time for an implementation change to bring about the desired
     results is also a danger.  Positive gaps can also be a problem if the
     other implementation factors are not adjusted upwards to handle the
     situation.  Ie:  if sales potential is greater than your ability to
     produce product, you will lose profits and have an unhappy sales force.
     Some links of the company chain may be very strong while others that
     are weak will hold the company back.  Learning to identify gaps and the
     reasons for them together with a balancing of implementation chains or
     departments to work together harmoniously and to the maximum of their
     ability is the key to successful management.

     Completion of the Simulation:

                Once you have completed the mini-case for the last month of
     operations (December) and have used the Advance Date function, you have
     completed the simulation.  The only remaining task to perform, is to
     print-out the final financial statements for the month of December.
                After the program has completed calculations using the
     Advance Date option, the program will show a screen that will indicate
     that you are finished and will provide you with a reminder that you
     still need to print off the financial statements.  The program will
     then bring you back to the main-menu, where you can print the
     statements immediately or you can defer this task until another day.
                The program has a built in termination procedure that will
     prevent you from entering any further data or using any of the program
     modules except for the view or print statements options contained
     within the Finance module.  When the simulation is over it's really
     over.  You can begin a new simulation starting from scratch by using
     one of the backup copies of the original Student Master Data Disk.


















                      16





     APPENDIX


     Installing the Program on a Hard Drive:

                The program comes in an archived self-extracting file, which
     can be copied into any hard-drive directory or subdirectory.
             If you are viewing this using an Ansi text reader or reading
     it hardcopy, you obviously have self-extracted the files.  There is
     another self-extracting archive file called PROGRAMS.EXE, which contains
     all the program files and data files.  This file will be de-compressed
     when you use the INSTALL.BAT file. Make sure to read the file 1STREAD.DOC
     which explains the install further.



     Create back-up copies of the original data disk:

                Use the Master Student Data Disk to make several copies of
     the data disk.  The purchaser of the program is allowed to make as many
     copies of the data disk as desired, however only one copy of the
     program can be used per machine.  The main purpose of having numerous
     copies of the data disk is for back-up and to provide the student with
     the opportunity to restart the simulation from scratch should they want
     to try the simulation more than one time.  This would be desirable
     should the unfortunate student go bankrupt after only three months into
     the simulation.  To make back-up copies of the Master Data Disk, place
     the original in drive A: and a blank formatted disk in drive B: then
     type in the DOS command DISKCOPY A: B: or you can use COPY *.* A: B:
     (consult your DOS book for further instructions)

     Products To Produce Worksheet (Form #1):

                Use this worksheet to determine the total volume of units to
     produce for each individual product.  From the marketing main-menu,
     select the sub-menu called [Projections].  Make a hard copy of the
     figures shown on the screen by pressing down and holding the [SHIFT]
     key while tapping the [PRINT] key.  This will print a hard copy of what
     is currently shown on the screen.  Remember that the volumes shown from
     this projection are range  sales volumes for a single franchise and
     must be multiplied by the total number of currently existing
     franchises.  You must determine the exact volume to use from the range.
                Transfer the volumes received from the screen-print over to
     column #1 'Individual Franchise Volume' onto Form #1.  Next, write down
     the number of currently existing franchise outlets into column #2.  Now
     complete column #3 by, multiplying the volume shown in column #1 by the
     number of existing franchises as shown in column #2.  To complete
     column #4 'Bulk Sales', you will need to complete the lower section of
     Form #1 called 'New Franchise Bulk Sales Volume'.  From the upper
     righthand portion of the on-screen print-out, enter the number of
     projected franchise outlets that will be sold this month into column #2
     of this lower section.  Complete column #3 'Total Bulk Sales Volumes'
     by multiplying column #1 by column #2 (Volumes sold with each new
     franchise X # of franchises that will be sold this month).  You are now
     ready to transfer these bulk sales volume figures up to column #4 on




                       Page A1






     the upper portion of Form #1.  To calculate the values for column #5
     'Volume To Produce', simply add column #3 with column #4 (Total Volume
     For Franchises + Bulk Sales Volume).
                You have now projected the total product volumes that need
     to be produced for this month.  The actual volumes that can be produced
     will of course be limited to the company's actual capacity to produce.


     Sales Revenue and Production Costs Worksheet (Form #2):

                Use this worksheet to project your revenue and production
     expenses for the month.  From the 'Products To Produce' worksheet
     (Form #1), copy the total product volumes that you have decided to
     produce for the month into column #1 of the Revenue and Expense
     worksheet (Form #2).  Next, go to the bottom of Form #2 and complete
     the three columns, which are the material cost per unit, labour cost
     per unit and the selling price per unit.  This information can be found
     by selecting [MARKETING] from the main-menu and selecting [Product]
     from the sub-menu.  Complete column #2 of Form #2 by multiplying the
     volume to produce figure for each product by the corresponding material
     cost per unit shown in column #1 of the lower portion of the form.
     Proceed to complete column #3 of Form #2 by multiplying the volume to
     produce figure for each product by the corresponding labour cost per
     unit shown in column #2 of the lower portion of the form.  Column #4
     total production costs is calculated, simply by adding the monetary
     values of column #2 and column #3 together (Total Material Costs +
     Total Labour Costs).  The final column #5 total sales revenue is
     calculated by multiplying the volume to produce figure for each product
     by the corresponding selling price per unit shown in column #3 of the
     lower portion of the form.
                You now have completed Form #2 and have projected the
     monthly revenue and production expenses.  Whether these projected
     figures will be correct will depend upon the actual demand and the
     company's capacity to produce.
                The actual costs of materials posted to expense will be in
     relation to the actual sales made, as the material costs are
     capitalized and held in the inventory account until sold.  However, the
     labour costs associated with making the products will be expensed out
     whether the product is sold or not.  So, labour costs will not be
     capitalized and included in the inventory account values.  Labour costs
     will vary in relationship to the capacity of the company.  If the
     company has the capacity to create the volume of products ordered, the
     labour costs for all products produced will be expensed immediately
     and the cost of raw materials used will be transferred from the Raw
     materials inventory into the Finished product inventory.  If the
     company does not have the capacity to produce the volume of products
     ordered, the raw materials will be purchased and kept in raw materials
     inventory, thus no corresponding labour is expensed nor are there any
     expenses recognized for the excess products that were ordered but could
     not be produced.  The material costs for the excess is held in the raw
     materials inventory.









                       Page A2





     Proforma Income Statement Worksheet (Form #3):

                Use this worksheet to project the revenue and expenses for
     the company each month.  The information required to complete the
     income and expense projection can be found in numerous areas including
     other worksheets you have prepared and data available from the various
     departments.  The impact of revenue and expenses generated from mini-
     cases will need to be recorded on the back of your decision journal
     Form #6 in order to incorporate the impact onto your projections.

     A guide to help you find the required information is shown below:

     ACCOUNT                  WHERE INFORMATION CAN BE FOUND

     Sales                    Form #2
     Franchise Fees           [MARKETING] > [Projections]
     Interest Income          Form #6 and [FINANCE] > [Investment]
     Raw Materials Used       Form #2
     Direct Labour            Form #2
     Fashion Design Wages     If you hired a fashion designer [PERSONNEL]
     Franchise Sales Wages    [PERSONNEL] > [View Records]
     Franchise Services       $8,000 for each new outlet sold + 2% of sales.
                              or $10,000 min if no product and outlet sales.
     Administrative Wages     [PERSONNEL] > [View Records]
     Bonus & Benefits         Form #6
     Marketing                Form #6 and [MARKETING] > sub-options
     Interest                 Form #6 and [FINANCE] > [Debt] > sub-options
     Depreciation             Previous Balance Sht or [PRODUCTION] >
                              [Equipment] > [View] for current book value.
                              Buildings = 5% per year, Equip = 20% per year.
                              1/2 year rule does not apply in the simulation
     Overhead & Other         15% of sales or $10,000 min if no product sale
     Income Tax Paid Out      40% of Profit. Losses will receive a refund.

     Proforma Balance Sheet Worksheet (Form #4):

                Use this worksheet to project what the year-to-date balance
     sheet will be for the month-end.  Use the previous month's balance
     sheet together with completed Form #6 and Form #3 to provide
     information necessary to complete Form #4.

     Proforma Statement of Changes Worksheet (Form #5):

                Use this worksheet to project your year-to-date cash flow.
     Use completed Form #4 to complete this form.  A good understanding of
     the impact a decrease or an increase in a particular balance sheet
     account will have, is needed in order to know whether the change has a
     source or a use effect upon the cash account.
                Given the presentation limitations of the Changes Statement,
     when an increase is projected for an account that is presented as
     "Decrease in account name", simply write this number as a negative
     number.  The same is true for the reverse, where a projected change is
     a decrease and the Changes Statement has presented the account as
     "Increase in account name", simply write this number as a negative
     number as well.





                       Page A3





                Once the form has been completed, simply add up all the
     positive numbers and subtract all the negative numbers.  The ending
     number you are left with added to the beginning cash on 91/12/31 should
     be your ending cash balance for the month.  Remember not to let your
     cash balance exceed -500,000 or you will go bankrupt!

     Management Decision Journal (Form #6):

                Use this form to document all of your decisions each month
     as you progress through the simulation.  You will need 12 copies of
     this and the other forms, so please photocopy as many as you need.
                It is important to document your decisions in order to know
     what impact your decisions are having and what decisions you made when.
     There is a lot of detail in this simulation and you will not remember
     everything, like how much did you spend on Television ads 4 months ago
     or who received a raise and for how much, or when product Y was priced
     at X    was there a 5% or 10% drop in demand?  It will also help to
     explain unexpected or forgotten revenue and/or expenses that arise from
     the decisions you made with previous mini-cases.

     Environmental Threat Opportunity Profile (ETOP) Worksheet (Form #7):

                Use this form to prepare your analysis of the external
     environment.  The principles involved with preparing an ETOP are beyond
     the scope of the objectives for this simulation.  Consult a Strategic
     Management text to learn about this step in the art of SM.

     Strategic Advantage Profile (SAP) worksheet (Form #8):

                Use this form to prepare your analysis of the internal
     environment.  What strengths or weaknesses does the company have and
     how can you use the strengths and correct or avoid activities that are
     dependant upon those weaknesses.  The principles involved with
     preparing a SAP are beyond the scope of the objectives for this
     simulation.  Consult a Strategic Management text to learn about this
     step in the art of SM.

     Strategic Planning Worksheets (Forms #9 - #12):

                There are 4 separate worksheets included for you to prepare
     your strategies, policy, implementation and feedback procedures within
     this simulation.  Each page will cover one of the company's departments
     and should be completed before continuing on with the actual
     simulation software program.  An example of completed form follows:
     ┌───────────────────────────────────────────────────────────────────┐
     │ Student Name:                           STRATEGY WORKSHEET PAGE 2 │
     ├───────────────────────────────────────────────────────────────────┤
     │             STRATEGY FOR THE COMPANY MARKETING           Form #10 │
     ├───────────────────────────────────────────────────────────────────┤
       FRANCHISE UNITS SOLD OBJECTIVE:  To sell 50 more outlets this year.

       What is the plan to implement this objective: Hire two more sales-
       people, increase ad cost by 40% and equipment expenditures by 95%.

       What procedures will you use to implement the plan:  Secure and
       allocate the required funds for; staff, capital equipment and





                       Page A4




       advertising space while remaining solvent at all times.

       What methods of control and feedback will you use: Have the Marketing
       Dept. prepare multiple projections each month and evaluate progress.
       Insure the Production Dept. has the capacity to produce the bulk and
       ongoing sales necessary for each new outlet sold.

     Annual Report To The CEO (Form #13):

                This is a three page questionnaire containing 42 questions.
     You are required to complete this report on separate paper and submit
     it to your instructor along with a balance sheet, income statement,
     statement of changes and ratio print-outs.  You may also be required to
     hand in your completed worksheets if requested by your instructor as
     back-up.


     Financial Ratios:

                As most of these ratios will be found in several of your
     college texts, no re-iteration will be made within this student manual.
     One of the goals of your financial plan should be to strive for ratios
     that are in line with that of the Industry Standard.  However, given
     that most business entities are unique in some way, Industry Standards
     are not always applicable to your company.  For example if you owned a
     flower shop that also sold glassware or numerous other products besides
     flowers, you would not be able to compare yourself to the industry
     standard digit for digit.  Also, if your company ventures into vertical
     /horizontal or backward/forward integration activities, your
     performance will also be different than that of the industry.  So,
     don't rely solely on ratios to provide performance evaluation, rather
     use multiply analysis tools to evaluate your company's performance over
     time.



























                       Page A5


┌──────────────────────────────────────────────────────────────────────────┐
│Student Name:                             For the month of:               │
├──────────────────────────────────────────────────────────────────────────┤
│                 PRODUCTS  TO  PRODUCE  ORDER  FORM              Form #1  │
├─────────────────┬────────────┬────────────┬────────────┬───────┬─────────┤
│                 │            │            │            │       │         │
│ PRODUCT         │ INDIVIDUAL │ # OF       │ TOTAL      │ BULK  │ VOLUME  │
│                 │ FRANCHISE  │ EXISTING   │ FOR        │ SALES │   TO    │
│                 │ VOLUME     │ FRANCHISES │ FRANCHISES │       │ PRODUCE │
├─────────────────┼────────────┼────────────┼────────────┼───────┼─────────┤
│ Pants: Mens     │            │            │            │       │         │
├─────────────────┼────────────┼────────────┼────────────┼───────┼─────────┤
│ Pants: Womans   │            │            │            │       │         │
├─────────────────┼────────────┼────────────┼────────────┼───────┼─────────┤
│ Pants: Boys     │            │            │            │       │         │
├─────────────────┼────────────┼────────────┼────────────┼───────┼─────────┤
│ Pants: Girls    │            │            │            │       │         │
├─────────────────┼────────────┼────────────┼────────────┼───────┼─────────┤
│ Shirts: Unisex  │            │            │            │       │         │
├─────────────────┼────────────┼────────────┼────────────┼───────┼─────────┤
│ Jackets: Mens   │            │            │            │       │         │
├─────────────────┼────────────┼────────────┼────────────┼───────┼─────────┤
│ Jackets: Womans │            │            │            │       │         │
├─────────────────┼────────────┼────────────┼────────────┼───────┼─────────┤
│ Jackets: Boys   │            │            │            │       │         │
├─────────────────┼────────────┼────────────┼────────────┼───────┼─────────┤
│ Jackets: Girls  │            │            │            │       │         │
├─────────────────┼────────────┼────────────┼────────────┼───────┼─────────┤
│ Handbags        │            │            │            │       │         │
├─────────────────┼────────────┼────────────┼────────────┼───────┼─────────┤
│ TOTALS          │            │            │            │       │         │
└─────────────────┴────────────┴────────────┴────────────┴───────┴─────────┘
  NEW FRANCHISE BULK  SALES  VOLUME  WORKSHEET
┌─────────────────┬────────────┬────────────┬────────────┐
│   Products      │ Volume     │ # Of New   │   TOTAL    │
│   That Are      │ Sold With  │ Franchises │   BULK     │
│   Sold With     │ Each  New  │ That Will  │   SALES    │
│   Each New      │ Franchise  │ Be Sold    │   VOLUMES  │
│   Franchise     │            │ This Month │            │
├─────────────────┼────────────┼────────────┼────────────┤
│ Pants: Mens     │   150      │            │            │
├─────────────────┼────────────┼────────────┼────────────┤
│ Pants: Womans   │   250      │            │            │
├─────────────────┼────────────┼────────────┼────────────┤
│ Pants: Boys     │   140      │            │            │
├─────────────────┼────────────┼────────────┼────────────┤
│ Pants: Girls    │   160      │            │            │
├─────────────────┼────────────┼────────────┼────────────┤
│ Shirts: Unisex  │   400      │            │            │
├─────────────────┼────────────┼────────────┼────────────┤
│ Skirts          │   100      │            │            │
├─────────────────┼────────────┼────────────┼────────────┤
│ Jackets: Mens   │    80      │            │            │
├─────────────────┼────────────┼────────────┼────────────┤
│ Jackets: Womans │    90      │            │            │
├─────────────────┼────────────┼────────────┼────────────┤
│ Jackets: Boys   │    50      │            │            │
├─────────────────┼────────────┼────────────┼────────────┤
│ Jackets: Girls  │    40      │            │            │
├─────────────────┼────────────┼────────────┼────────────┤
│ Handbags        │    30      │            │            │
└─────────────────┴────────────┴────────────┴────────────┘




┌──────────────────────────────────────────────────────────────────────────┐
│ Student Name:                        For the Month of:                   │
├──────────────────────────────────────────────────────────────────────────┤
│                                                                          │
│        SALES REVENUE  AND PRODUCTION COSTS  WORKSHEET            Form #2 │
│                                                                          │
├────────────────┬────────┬─────────┬─────────┬──────────────┬─────────────┤
│                │ VOLUME │  TOTAL  │ TOTAL   │     TOTAL    │ TOTAL       │
│ PRODUCT        │   TO   │MATERIAL │ LABOUR  │  PRODUCTION  │ SALES       │
│                │ PRODUCE│  COSTS  │ COSTS   │     COSTS    │ REVENUE     │
├────────────────┼────────┼─────────┼─────────┼──────────────┼─────────────┤
│Pants: Mens     │        │         │         │              │             │
├────────────────┼────────┼─────────┼─────────┼──────────────┼─────────────┤
│Pants: Womans   │        │         │         │              │             │
├────────────────┼────────┼─────────┼─────────┼──────────────┼─────────────┤
│Pants: Boys     │        │         │         │              │             │
├────────────────┼────────┼─────────┼─────────┼──────────────┼─────────────┤
│Pants: Girls    │        │         │         │              │             │
├────────────────┼────────┼─────────┼─────────┼──────────────┼─────────────┤
│Shirts: Unisex  │        │         │         │              │             │
├────────────────┼────────┼─────────┼─────────┼──────────────┼─────────────┤
│Skirts          │        │         │         │              │             │
├────────────────┼────────┼─────────┼─────────┼──────────────┼─────────────┤
│Jackets: Mens   │        │         │         │              │             │
├────────────────┼────────┼─────────┼─────────┼──────────────┼─────────────┤
│Jackets: Womans │        │         │         │              │             │
├────────────────┼────────┼─────────┼─────────┼──────────────┼─────────────┤
│Jackets: Boys   │        │         │         │              │             │
├────────────────┼────────┼─────────┼─────────┼──────────────┼─────────────┤
│Jackets: Girls  │        │         │         │              │             │
├────────────────┼────────┼─────────┼─────────┼──────────────┼─────────────┤
│Handbags        │        │         │         │              │             │
├────────────────┼────────┼─────────┼─────────┼──────────────┼─────────────┤
│TOTALS          │        │         │         │              │             │
├────────────────┴────────┴─────────┴─────────┴──────────────┴─────────────┘
├────────────────┬─────────┬─────────┬─────────────┐
│                │ MATERIAL│  LABOUR │  SELLING    │
│                │ COST PER│ COST PER│  PRICE PER  │
│PRODUCT         │   UNIT  │   UNIT  │    UNIT     │
├────────────────┼─────────┼─────────┼─────────────┤
│Pants: Mens     │         │         │             │
├────────────────┼─────────┼─────────┼─────────────┤
│Pants: Womans   │         │         │             │
├────────────────┼─────────┼─────────┼─────────────┤
│Pants: Boys     │         │         │             │
├────────────────┼─────────┼─────────┼─────────────┤
│Pants: Girls    │         │         │             │
├────────────────┼─────────┼─────────┼─────────────┤
│Shirts: Unisex  │         │         │             │
├────────────────┼─────────┼─────────┼─────────────┤
│Skirts          │         │         │             │
├────────────────┼─────────┼─────────┼─────────────┤
│Jackets: Mens   │         │         │             │
├────────────────┼─────────┼─────────┼─────────────┤
│Jackets: Womans │         │         │             │
├────────────────┼─────────┼─────────┼─────────────┤
│Jackets: Boys   │         │         │             │
├────────────────┼─────────┼─────────┼─────────────┤
│Jackets: Girls  │         │         │             │
├────────────────┼─────────┼─────────┼─────────────┤
│Handbags        │         │         │             │
└────────────────┴─────────┴─────────┴─────────────┘




┌──────────────────────────────────────────────────────────────────────────┐
│ Student Name:                        For the Month of:                   │
├──────────────────────────────────────────────────────────────────────────┤
│                      PRO-FORMA   INCOME   STATEMENT             Form #3  │
│                                                                          │
│                                                                          │
│ REVENUE:                                                                 │
│                                                                          │
│ Sales                                          _____________________     │
│                                                                          │
│ Franchise Fees                                 _____________________     │
│                                                                          │
│ Interest Income                                _____________________     │
│                                                                          │
│ TOTAL REVENUE                                  =====================     │
│                                                                          │
│ EXPENSES:                                                                │
│                                                                          │
│ Raw Material Used                              _____________________     │
│                                                                          │
│ Direct Labour                                  _____________________     │
│                                                                          │
│ Fashion Design Wages                           _____________________     │
│                                                                          │
│ Franchise Salesman Wages                       _____________________     │
│                                                                          │
│ Franchise Services                             _____________________     │
│                                                                          │
│ Administrative Wages                           _____________________     │
│                                                                          │
│ Bonus and Benefits                             _____________________     │
│                                                                          │
│ Marketing Expenses                             _____________________     │
│                                                                          │
│ Interest Expenses                              _____________________     │
│                                                                          │
│ Depreciation Expenses                          _____________________     │
│                                                                          │
│ Overhead & Other Expenses                      _____________________     │
│                                                                          │
│ TOTAL EXPENSES                                 =====================     │
│                                                                          │
│ NET PROFIT                                     _____________________     │
│                                                                          │
│ Income Tax Paid Out                            _____________________     │
│                                                                          │
│ INCOME (LOSS) AFTER TAX                        =====================     │
│                                                                          │
│                                                                          │
│                                                                          │
│                                                                          │
│                                                                          │
│                                                                          │
│                                                                          │
│                                                                          │
│                                                                          │
│                                                                          │
│                                                                          │
└──────────────────────────────────────────────────────────────────────────┘







┌──────────────────────────────────────────────────────────────────────────┐
│ Student Name:                        For the Month of:                   │
├──────────────────────────────────────────────────────────────────────────┤
│                        PRO-FORMA   BALANCE  SHEET              Form #4   │
│                                                                          │
│ ASSETS:                                                                  │
│                                                                          │
│ Cash                                           __________________        │
│                                                                          │
│ Accounts Receivable                            __________________        │
│                                                                          │
│ Short term Investments                         __________________        │
│                                                                          │
│ Raw Material Inventory                         __________________        │
│                                                                          │
│ Finished Product Inventory                     __________________        │
│                                                                          │
│ Land                                           __________________        │
│                                                                          │
│ Building                                       __________________        │
│                                                                          │
│ Accum. Deprec. Building                        __________________        │
│                                                                          │
│ Equipment                                      __________________        │
│                                                                          │
│ Accum. Deprec. Equipment                       __________________        │
│                                                                          │
│ TOTAL ASSETS                                   ==================        │
│                                                                          │
│ LIABILITIES:                                                             │
│                                                                          │
│ Bank Overdraft                                 __________________        │
│                                                                          │
│ Accounts Payable                               __________________        │
│                                                                          │
│ Bank Loans                                     __________________        │
│                                                                          │
│ Revolving Credit                               __________________        │
│                                                                          │
│ Current Portion L/T Debt                       __________________        │
│                                                                          │
│ Mortgage                                       __________________        │
│                                                                          │
│ L/T Shareholders Loan                          __________________        │
│                                                                          │
│ TOTAL LIABILITIES                              __________________        │
│                                                                          │
│                                                                          │
│ EQUITY:                                                                  │
│                                                                          │
│ Common Shares                                  __________________        │
│                                                                          │
│ Retained Earnings                              __________________        │
│                                                                          │
│ Revenue after Tax                              __________________        │
│                                                                          │
│ TOTAL EQUITY                                   __________________        │
│                                                                          │
│ TOTAL LIABILITIES AND EQUITY                   ==================        │
│                                                                          │
│                                                                          │
└──────────────────────────────────────────────────────────────────────────┘




┌──────────────────────────────────────────────────────────────────────────┐
│ Student Name:                        For the Month of:                   │
├──────────────────────────────────────────────────────────────────────────┤
│  PRO-FORMA   STATEMENT  OF  CHANGES  IN  FINANCIAL  POSTION  WORKSHEET   │
│        For The Period January 1, 1992 to________________   (YTD)         │
├──────────────────────────────────────────────────────────────────────────┤
│ OPERATING ACTIVITIES:                                                    │
│                                                                          │
│   Cash provided by operations:                                           │
│     Net Income after tax                       _____________________     │
│     Add: Items not requiring cash outflow:                               │
│          Depreciation expenses                 _____________________     │
│          Decrease in accounts receivable       _____________________     │
│          Decrease in Inventory                 _____________________     │
│     Less: Items not providing cash inflow:                               │
│          Decrease in accounts payable          _____________________     │
│                                                                          │
│   Total Cash Provided by operations            _____________________     │
│                                                                          │
│                                                                          │
│ INVESTING ACTIVITIES:                                                    │
│                                                                          │
│   Increase in assets                           _____________________     │
│   Increase in investments                      _____________________     │
│                                                                          │
│   Total cash used in investing activities      _____________________     │
│                                                                          │
│ FINANCING ACTIVITIES:                                                    │
│                                                                          │
│   Increase in Debts                            _____________________     │
│                                                                          │
│                                                                          │
│ INCREASE (DECREASE) IN CASH                                              │
│                                                =====================     │
├──────────────────────────────────────────────────────────────────────────┤
│                                WORKSHEET                                 │
├──────────────────────────┬────────────┬───────────────┬──────────────────┤
│     ACCOUNT              │ BALANCE AT │ PROJECTED YTD │    DIFFERENCES   │
│                          │ 91/12/31   │   BALANCES    │INCREASE  DECREASE│
├──────────────────────────┼────────────┼───────────────┼────────┬─────────┤
│ Cash                     │   251,000  │_______________│________│_________│
│ Accounts Receivable      │   814,000  │_______________│________│_________│
│ Short Term Investments   │         0  │_______________│________│_________│
│ Raw Material Inventory   │   184,000  │_______________│________│_________│
│ Finished Goods Inventory │   184,000  │_______________│________│_________│
│ Land                     │   234,070  │_______________│________│_________│
│ Buildings                │   200,000  │_______________│________│_________│
│ Accum. Deprec: Buildings │    14,750  │_______________│________│_________│
│ Equipment                │   144,000  │_______________│________│_________│
│ Accum. Deprec: Equipment │    40,320  │_______________│________│_________│
│ Bank Overdraft           │         0  │_______________│________│_________│
│ Accounts Payable         │ 1,333,000  │_______________│________│_________│
│ Bank Loans               │         0  │_______________│________│_________│
│ Revolving Credit         │         0  │_______________│________│_________│
│ Current Portion Debt     │         0  │_______________│________│_________│
│ Mortgage                 │         0  │_______________│________│_________│
│ L/T Shareholder Loan     │   252,000  │_______________│________│_________│
│ Common Shares            │       100  │_______________│________│_________│
│ Retained Earnings        │   370,900  │_______________│________│_________│
├──────────────────────────┼────────────┼───────────────┼────────┼─────────┤
│ TOTALS                   │         0  │               │        │         │
└──────────────────────────┴────────────┴───────────────┴────────┴─────────┤




┌──────────────────────────────────────────────────────────────────────────┐
│                                                                          │
│                         MANAGEMENT DECISION FORM                 Form #6 │
│                                                                          │
│ For the Month of _______________________  Student's Name:________________│
├──────────────────────────────────────────────────────────────────────────┤
│ FINANCE:                                                                 │
├──────────────────────────────────────────────────────────────────────────┤
│ A/R Policy       Percent down with order _____ Balance due in ______ Mths│
│ A/P Policy       Percent down with order _____ Balance due in ______ Mths│
│ Line of Credit   Amount used this month  ________________________________│
│ Debt type #1     Amt borrowed this month _________ Total owing __________│
│ Debt type #2     Amt borrowed this month _________ Total owing __________│
│ Mortgage         Did you mortgage the property this month? ______________│
│ Misc Credit      Did you secure Misc. credit this month?   ______________│
│ Investment A     Amt invest. this month _________ Total invest.__________│
│                  Amt of investment cashed-in this month _________________│
│ Investment B     Amt invest. this month _________ Total invest.__________│
│                  Amt of investment cashed-in this month _________________│
│ Investment C     Amt invest. this month _________ Total invest.__________│
│                  Amt of investment cashed-in this month _________________│
│ Bonds            Amt of Bond this month _________ Total Bonds ___________│
│                  Amt of Bonds cashed-in this month      _________________│
│ Stocks           Amt of Stock this month_________ Total Stock ___________│
├──────────────────────────────────────────────────────────────────────────┤
│ MARKETING:                                                               │
├──────────────────────────────────────────────────────────────────────────┤
│ Franchise Fee    Fee is set at __________________ per unit this month.   │
│ Product Prices   Prices are [] Up _______%  [] Dwn ________% this month. │
│ TV Promo         Spent _______________ for ads this month.               │
│ Radio Promo      Spent _______________ for ads this month.               │
│ Print Promo      Spent _______________ for ads this month.               │
│                  Total Promo costs this month were:______________________│
│ Projections      Franchise units sold this month will be ________________│
│                  Total product sales for existing outlets _______________│
│                  Total products sold with new outlets     _______________│
├──────────────────────────────────────────────────────────────────────────┤
│ PRODUCTION:                                                              │
├──────────────────────────────────────────────────────────────────────────┤
│ Capacity         Capacity to produce garments this month was ____________│
│ Buy Equipment    Amt of new equipment purchased this month ______________│
│ Sell Equipment   Book value of equipment sold this month   ______________│
│ Inventory        [] Decreased  [] Increased Raw stock levels by   ______%│
│                  [] Decreased  [] Increased Finish stock level by ______%│
│ Output           Total garments ordered  this month were  __________items│
│                  Actual garments produced this month were __________items│
│ Suppliers        Supplier used for Material A was _______________________│
│                  Supplier used for Material B was _______________________│
│                  Supplier used for Material C was _______________________│
│                  Supplier used for Material D was _______________________│
├──────────────────────────────────────────────────────────────────────────┤
│ PERSONNEL:                                                               │
├──────────────────────────────────────────────────────────────────────────┤
│ Bonus/Raise      [] Bonus  [] Raise valued @ _______ to _________________│
│                  [] Bonus  [] Raise valued @ _______ to _________________│
│ Demotion         ___________________________ New Position _______________│
│ Disapline        ___________________________ valued @ ___________________│
│ Fire             ___________________ Dept ____________Position __________│
│ Hire             ___________________ Dept ____________Position __________│
│ Promote          ___________________ Dept ____________Position __________│
│ Mini-Case        Option selected #_________ Projected impact (use back)  │
└──────────────────────────────────────────────────────────────────────────┘




┌──────────────────────────────────────────────────────────────────────────┐
│ Student Name:                                                            │
├──────────────────────────────────────────────────────────────────────────┤
│  ENVIRONMENTAL THREAT OR OPPORTUNITY PROFILES  (ETOP)           Form #7  │
├────────────────────────────┬───┬───┬─────────────────────────────────────┤
│ ENVIRONMENTAL AREAS        │ + │ - │   IMPACT OF ENVIRONMENTAL AREAS     │
├────────────────────────────┼───┼───┼─────────────────────────────────────┤
│ Social or Economic         │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│ Technological              │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│ Government                 │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│ Customers                  │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│ Suppliers                  │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
├────────────────────────────┴───┴───┴─────────────────────────────────────┤
│ NOTES:                                                                   │
│                                                                          │
│                                                                          │
│             (+ Indicates Opportunity and - Indicates Threat)             │
└──────────────────────────────────────────────────────────────────────────┘




┌──────────────────────────────────────────────────────────────────────────┐
│ Student Name:                                                            │
├──────────────────────────────────────────────────────────────────────────┤
│              STRATEGIC  ADVANTAGE  PROFILE   (SAP)              Form #8  │
├────────────────────────────┬───┬───┬─────────────────────────────────────┤
│ COMPANY INTERNAL AREAS     │ + │ - │   COMPANY STRENGTH OR WEAKNESS      │
├────────────────────────────┼───┼───┼─────────────────────────────────────┤
│ Finance                    │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│ Marketing                  │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│ Production                 │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│ Company Resources          │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│ R & D or Product Design    │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
│                            ├───┼───┼─────────────────────────────────────┤
│                            │   │   │                                     │
├────────────────────────────┴───┴───┴─────────────────────────────────────┤
│ NOTES:                                                                   │
│                                                                          │
│                                                                          │
│             (+ Indicates Strength and  - Indicates Weakness)             │
└──────────────────────────────────────────────────────────────────────────┘




┌──────────────────────────────────────────────────────────────────────────┐
│ Student Name:                                  STRATEGY WORKSHEET PAGE 1 │
├──────────────────────────────────────────────────────────────────────────┤
│                    STRATEGY FOR THE COMPANY FINANCES             Form #9 │
├──────────────────────────────────────────────────────────────────────────┤
│ CASH BALANCE OBJECTIVE:                                                  │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ ACCOUNTS RECEIVABLE OBJECTIVE:                                           │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ ACCOUNTS PAYABLE OBJECTIVE:                                              │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ DEBT OBJECTIVES:                                                         │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ INVESTMENT OBJECTIVES:                                                   │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
└──────────────────────────────────────────────────────────────────────────┘




┌──────────────────────────────────────────────────────────────────────────┐
│ Student Name:                                  STRATEGY WORKSHEET PAGE 2 │
├──────────────────────────────────────────────────────────────────────────┤
│                    STRATEGY FOR THE COMPANY MARKETING           Form #10 │
├──────────────────────────────────────────────────────────────────────────┤
│ FRANCHISE FEE OBJECTIVE:                                                 │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ NUMBER OF FRANCHISE UNITS SOLD OBJECTIVE:                                │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ PRODUCT PRICE OBJECTIVE:                                                 │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What method of control and feedback will you use:                        │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ PRODUCT QUALITY AND FABRIC COSTS OBJECTIVE:                              │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ ADVERTISING OBJECTIVES:                                                  │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
└──────────────────────────────────────────────────────────────────────────┘




┌──────────────────────────────────────────────────────────────────────────┐
│ Student Name:                                  STRATEGY WORKSHEET PAGE 3 │
├──────────────────────────────────────────────────────────────────────────┤
│                   STRATEGY FOR THE COMPANY PRODUCTION           Form #11 │
├──────────────────────────────────────────────────────────────────────────┤
│ EQUIPMENT AND CAPACITY OBJECTIVE:                                        │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ INVENTORY LEVELS OBJECTIVE:                                              │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ FINISHED PRODUCT OUTPUT OBJECTIVES:                                      │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ OVERALL PRODUCTION COSTS OBJECTIVE:                                      │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ CHOICE OF SUPPLIER/S OBJECTIVE:                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│ What methods of control and feedback will you use:                       │
│                                                                          │
└──────────────────────────────────────────────────────────────────────────┘




┌──────────────────────────────────────────────────────────────────────────┐
│ Student Name:                                  STRATEGY WORKSHEET PAGE 4 │
├──────────────────────────────────────────────────────────────────────────┤
│                   STRATEGY FOR THE COMPANY PERSONNEL             Form #12│
├──────────────────────────────────────────────────────────────────────────┤
│ BONUS OR RAISE OBJECTIVE:                                                │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control or feedback will you use:                        │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ PROMOTION OR DEMOTION OBJECTIVE:                                         │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control or feedback will you use:                        │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ DISAPLINE OBJECTIVE:                                                     │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control or feedback will you use:                        │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ FIRE EMPLOYEE OBJECTIVE:                                                 │
│                                                                          │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│                                                                          │
│ What methods of control or feedback will you use:                        │
│                                                                          │
├──────────────────────────────────────────────────────────────────────────┤
│ HIRE EMPLOYEE OBJECTIVE:                                                 │
│                                                                          │
│ What is the plan to implement this objective:                            │
│                                                                          │
│ What procedures will you use to implement the plan:                      │
│                                                                          │
│ What methods of control or feedback will you use:                        │
│                                                                          │
└──────────────────────────────────────────────────────────────────────────┘









                      PRESIDENT'S  ANNUAL  REPORT  TO  CEO          Form #13

     FINANCE:

     1) Did you modify the Accounts Receivable policy?
        (If so,  explain why.)


     2) Did you modify the Accounts Payable policy?
        (If so, explain why.)


     3) Did you secure a Line of Credit with the bank?
        (If so, for how many months was it used?)

     4) Did you utilize any of the Short Term Loans?
        (If so, how many times did you borrow money?)

     5) For what purposes were the loans acquired?


     6) Did you mortgage the company's land and Buildings?
        (If so, why did you do this?)


     7) Where you ever turned down for a loan?
        (If so, how many times?)

     8) How many times did you end up with a cash surplus greater than $300k
        (If so, in what month did you begin making investments and why?)

     9) Where you forced into liquidating any of your investments?
        (If so, why were you forced to liquidate?)

     10) Did you invest in the stock market?
         (If so, how much money did you make and how much did you lose?)

     11) What is your return on investments ratio?
         (Is it better or worse than the Industry Average?)

     12) What is your return on equity ratio?
         (Is it better or worse than the Industry Average?)

     13) Has your profit margin increased since you became President?
         (Also, is it better than the Industry Average?)

     14) Has your Gross margin increased since you became President?
         (Also, is it better than the Industry Average?)

     15) Is the company more financially secure after a year with you as the
         President?







                       Form #13 Page 1





     MARKETING:

     1) How much in total did you spend on advertising?

     2) How many franchises did you sell? (current # - 32):

     3) What is the % for advertising expense vs franchise fees revenue?


     4) In general, did your product prices go up or down?  If so, Why?

     5) Did you reach your sales volume targets?

     6) Did you sell more franchises than you could service with product?


     PRODUCTION:

     1) What was your ending capacity to produce garments?

     2) How many times was your capacity to produce greater than 10% over
        that of your monthly output volumes?

     3) Did you sell off any equipment?  If so, why?

     4) Did you reduce inventory levels or increase them?

     5) Where you capable of meeting 100% of product demands?

     6) Did you ever sell more franchises than you were capable of servicing
        with ongoing product demands or the bulk volumes for new outlets?

     7) Did you stick with one supplier or use several suppliers at the same
        time?  What was your reason for this strategy?

     PERSONNEL:

     1) Did you give any bonuses or raises during the simulation?  To who
     and why were they given?

     2) Did you demote any managers? Who and why?

     3) Did you provide discipline to any managers?  Who and why?

     4) Did you fire any managers? Who and why?

     5) Did you hire any new staff members?  Who and why?

     6) Did you promote any managers? Who and why?









                       Form #13 Page 2





     MINI-CASES:

     1) What was your final bonus/penalty score for the mini-cases?

     2) For those that you received a negative score on, why do you think
        you received this score?  Is there a better choice?

     3) Did you take advantage of opportunities presented within a case even
        though it may not have been in line with the company's original
        goals?  Explain why you did this in each instance.

     4) What would you do if you were Ms. Ferndale concerning the offer
        presented in case #12?  Why?

     GENERAL:

     1) If you were to do this simulation again, what changes would you make
        to your strategy?

     2) When looking back on your original strategies, goals and objectives,
        how close is the actual outcome or performance to those of the
        original plan?  What strategies, goals or objectives did you modify
        from the original plan and why?

     3) Did you consistently ask yourself "Is this decision in line with our
        company goals?" and document the reasons for making each decision or
        did you take the 'shoot-from-the-hip' approach more often than not?

     4) What did you learn from this simulation experience? Explain.





























                       Form #13 Page 3