A COST CHAIN FOR THE BUSINESS STRATEGY GAME SIMULATION Developments In Business Simulation & Experiential Exercises, Volume 22, 1995 152 A COST CHAIN FOR THE BUSINESS STRATEGY GAME SIMULATION Grant L. Lindstrom, University of Wyoming Don M. Parks, Southwestern University Michael J. Doherty, University of Wyoming The concepts of delivered cost and differentiation initially advanced by Hall (1980) and Porter (1980, 1985) have become central concepts in the field of business strategy and policy (Dess and Miller, 1993). Cost (Managerial) accounting addresses cost chain issues under the topic ‘value chain’ which is gaining emphasis in managerial accounting (Horngren and Foster, 1991). Despite an increased, and even intense focus on the concepts in each field separately, little attention has been paid to specific, detailed applications of cost chains that describe the components of delivered cost for use in strategic decision making. Static exceptions exist, but Total Business Enterprise simulations offer an excellent opportunity to demonstrate dynamic cost chains, given the centrality of accounting-based reports in simulations. This symposium and demonstration discusses the logic behind, and presents an application of a cost chain developed for use with the Business Strategy Game, 2nd ed. (Thompson and Stappenbeck, 1992). The cost chain (decision support output) for year 10 is attached to illustrate the difference in information provided vs. the cost report included in the simulation. The two main ways in which the attached cost chain is different include additional information concerning areas where sales are possible, and more detail. Greater detail in information can enhance decision-making. Additionally, the attached cost chain uses a “cost of production” basis rather than a “cost of goods sold”. When inventory changes significantly from year to year (as happens in this simulation), a cost of goods sold report can easily mislead strategic decision making. This cost chain remedies that limitation. The cost chain template software and related documentation will be available to participants. REFERENCES Dess, G. G., & Miller, A. (1993). Strategic Management New York: McGraw-Hill. Hall, W. K. (1980) Survival Strategies in a Hostile Environment Harvard Business Review, 58, 75-85. Horngren, C. T., & Foster, G. (1991) Cost Accounting. Englewood Cliffs, N.J.: Prentice-Hall. Porter, M. E. (1980) Competitive Strategy New York: Free Press. Porter, M. E. (1985) Competitive Advantage New York: Free Press. Thompson, A. A., & Stappenbeck, G. (1992) The Business Strategy Game: A Global Industry Simulation, 2nd ed. Homewood, Ill.: Irwin. Table of Contents Volume 22, 1995 Simulation Performance, Learning and Struggle Are Good Simulation Performers Consistently Good? Cognitive and Behavioral Consistency in a Computer-Based Marketing-Simulation-Game Environment: An Empirical Investigation of the Decision-Making Process Chalk & Cheese: Executive Short-Course vs. Academic Simulations Revisiting Personality Bias in Total Enterprise Simulations Are Good Strategies Consistently Good? Investigating the Use of a Computer Simulation as an Effective Pedagogical Tool for the Application of a Strategic Model The Problem of determining an Individualized Simulation's Validity as an Assessment Tool A Simulation Based Analysis of the Value of Information in the Hrebiniak Joyce Typology of Adaptation Relative to Porter's Generic Strategies The Impact of Sales and Income Growth on Profitability and Market Measures in Actual and Simulated Industries A Comparison of a Stand Alone Version of a Simulation with the Traditional Competitive Version Computer-Assisted Gaming of International Business Analyzing Simulations with Computer-Based Programs and Applying the Experience to a Real-World Business A Preliminary Investigation of the Use of a Bankruptcy Indicator in a Simulation Environment Graduates' Views on the Use of Computer Simulation Games Versus Cases as Pedagogical Tools An Analytical Advertising Model Approach to the Determination of Market Demand Dealing with the Complexity Paradox in Business Simulation Games A Prototyping Approach for Incorporating Large Data Bases into Media Planning Simulations: An Example Using Magazine Media Through the Looking Glass, Inc: Superior-Subordinate Personality Type and the Leniency effect Evaluating the Effectiveness of Role Playing Simulation and Other Methods in Teaching Managerial Skills Student and Teacher Perceptions of a Management Simulation Course Performance Evaluation: The Effect on the Propensity to Create Budgetary Slack Management Team Formation for Large Scale Simulations Comparative Static Analysis with the Complete PPA Package: A Strategic Market Planning Tool Consistency in Intent: Learning Objectives at the 1994 Intercollegiate Business Policy Competition A New Twist on an Old Game: The Business Strategy Game: A Global Industry Simulation 3ed Evaluation of Performance in Management Simulation: A Management Coefficients Model Building SimuWorlds: Strategic Management Games of the Future Bulls and Bears: A Stock Market Simulation A Systems Thinking Paradigm and Think Computer Simulation Model of Broadcast and Cable Television Industry Competition Jacket Factory The Sales Management Simulation The Marketing Management Simulation A Demonstration of Promodel Demonstrating A New, Cross-Functional Business Simulation: Vision+ A Cost Chain For The Business Strategy Game Simulation Special Session On Experiential Teaching Compensation Dilemmas: An Exercise In Ethical Decision-Making Organizational Storytelling: Telling Tales In The Business Classroom Evaluating Experiential Training: Case Study And Recommendations The Internship Portfolio: An Innovative Tool For Experiential Learning, Critical Thinking, And Communication An Ethnographic Analysis Of The Pedagogical Impact Of Cooperative Communicating Consumer Behavior: A Long-Term Integrated Exercise Using Personal Consumption Journals And Consumer Analysis Papers An Experiential Paradigm For Teaching Business Problem Solving Developing Leadership Skills The Spss® Student Assistant: The Integration of A Statistical Analysis Program Into A Marketing Research Textbook Negotiating With Your Students Using TQM Principles To Transform Accounting Systems Into An Experiential Exercise Enhancing The Effectiveness Of Outdoor-Based Experiential Training Using Virtual Reality Concepts Case Writing In A Developing Country: An Indonesian Example Experiential Learning Using Focus Groups How Real Should Experiential Pedagogy Be? A Viewpoint From Our Students Reengineering The Internship: A New Approach To Experiential Learning Utilizing The Cosmopolitan/Local And Marginal Man Constructs To Measure Students' Propensity For Creativity Developing Experiential Processes For Teaching Quantitative Techniques For Business Team Learning Roles: A Cooperative Learning Technique Creating the Ultimate Small Business Student Experience: Melding Score/Ace with SBI The Development of Trust in Work Teams: The Impact of Touch Some Outcomes of Experiential Learning: How the Cultural Dynamics of Different Countries are reflected in Workplace Norms & Values Incorporation of Job Analysis Results in Various Forms of Selection Interviews Chudesno, Inc.: An Evaluation of an Experiential Training and Development Simulation An Exercise for Exploring the Relationship between Jungian Psychological Types and Organizational Dynamics Partnership: A Radical Approach to Experiential Learning Partnership: A Nice Idea, But How Do I Get Started? Recognizing Discrimination at Work Using Critical Incident Skills Questions to Help Students Become More Successful at Job Interviewing The Video Project Introduction to Psychological Type Theory Come On Down Understanding Facilitation for Development and Continuous Learning: A Micro-Workshop Leadership and Empowerment: An Experiential Exercise in Decision Making Experiential Exercises and Pedagogy Track Workshop: Selecting a Manager for Maquiladora, Inc. Experiential Training In Multi-Cultural Corporate Settings The Role of Facilitation as an Aid to Complete Learning An Experiential Exercise to Illustrate Difference in Information Processing Behaviors and Styles How to Deliver Accessible Survey Results Age Diversity in the Workplace- Family Feud Style Nafta Standoff: A Cross-Cultural negotiating Role-Play Three Strikes and You're Out!: A Downsizing Experiential Exercise