Lighthouse Strategic Partners

Business Reality 101

Business Reality 101®    

Business Reality 101® is a comprehensive board-based simulation that takes a realistic look at the complexities of running a modern day distribution company. The ultimate goal is to allow the employee base to gain a better understanding of how the business works, its’ strategies and operations and how they individually and collectively drive value for the organization.

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In this program, the participants are running a distribution company.

Each company consists of three to four players. So in the picture, the four    people sitting around the table are acting as this companies management team

The program forces the participants to look at multiple areas within the  business. These include:

Supply-Chain Management
Inventory Turns
Impact of Obsolete Inventory
EBIT as a Percentage of Sales
Days Sales Outstanding
Shared Services
Acquisitions/Green Fielding

There are four roles in this simulation:

– Sales and Marketing              – Finance

– Customer                                – Operations

The goal of the program is to take a distribution company that is only performing adequately at best, and turn it into a thriving enterprise.

By the end of the program, each team is making 100% of the decisions on how their business should be run. Debriefs center around the rationale behind the decisions they made, real-world industry concerns and what the impact of their decisions has to the company as a whole. The program is impossible to run and still maintain a ‘silo’ mentality. Big Picture look at the business allows participants to see just how important they are to their real-world company.

The simulation is designed to be run in one day. The agenda is listed below.

A Quick look at Year 1

  • This is a logistic year and the goal is to help both the participants to understand how their business works, how they generate cash and earn profits.
  • Look at cash flow from the distributors’ perspective and see the impact that cash flow has on the business.
  • Look at the cash flow cycle as the money flows from the customer to the distributor
  • Standard Income Statements and Balance Sheets are utilized to update and increase both business and financial acumen.

A Quick look at Year 2

  • ‘Company’ takes a look at the impact of inventory turns.
  • This comes in the form of evaluating number of suppliers and the impact a ‘random’ approach to supply chain has to a ‘focused’ approach to the supply chain has.
  • Companies are asked to pick a strategic direction for their company. Imperative that the companies turn a profit this year. The purpose is to help the participants understand what certain financial drivers means and why companies make the hard choices they do at times.
  • Sales Force Profitability
  • Customer Profitability
  • Managing Suppliers and Customers Effectively

A Quick look at Year 3

  • Re-Evaluating the Strategy and Executing Through Change
  • Tougher Competition
  • Shrinking or Growing – Managing through both
  • Running Lean
  • Assisting the Distributor with Sales
  • Looking for New Opportunities
  • Differentiating Yourself from your Competitors
  • Understanding the Value Proposition of your Channel Partner

  Lighthouse Strategic Partners

cropped-New_Logo_small1.png    a Summit Assessment Strategic Partner

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