Business Simulation and Professional Development Report: Lexo Strategy

This report provides a comprehensive analysis of Lexo, a smartphone company that outsources its production. Part A focuses on the business simulation, detailing Lexo's vision, core values, and marketing strategies, including cost leadership, product leadership, and customer focus. It examines the company's human resource practices, corporate culture, and reviews its performance using Porter's Five Forces analysis, evaluating customer and supplier bargaining power, threats of substitutes and new entrants, and competitive rivalry, along with a market share analysis. Part B offers a professional development reflection report, identifying key events, applying relevant theories and industrial practices, and offering recommendations for future practice and research. The report aims to understand business simulation and professional development within the context of Lexo's operations.

Business Simulation
with Professional
Development

INTRODUCTION...............................................................................................................................3
PART A – STRATEGY PAPER........................................................................................................3
Vision and Strategy of Lexo..............................................................................................................3
Review of Each Year’s Progress........................................................................................................5
Future plan and recommendation.......................................................................................................5
PART B – Professional development Reflection Report...................................................................5
Executive summary...........................................................................................................................5
Introduction.......................................................................................................................................5
Identified events................................................................................................................................6
Review of relevant concepts or theories............................................................................................6
Review of industrial practices............................................................................................................7
Application of theory as well as practices..........................................................................................7
Discussion.........................................................................................................................................8
Recommendation for practice and research.......................................................................................8
CONCLUSION....................................................................................................................................9
REFERENCES..................................................................................................................................11

INTRODUCTION
Business simulation is related to the activities which needed by individual for
establishing their own ventures in relation with real time market situation. In addition to this,
key of business simulation is to take important decisions that is aimed to acceleration of
business development and profitability within long duration. Moreover, simulation provide
platform to particular person where they can set their own business as well as get in the
manner where fluctuation take place in relation of market place. Apart from this, it has been
identified that business simulation provide assistance to individual within their professional
development which result in enhancing skills as well as knowledge in appropriate manner.
This report is based on Lexo which is smartphone company but they don’t produce
smartphones by themselves. Phones are produced in Asia under license of Lexo and it is
based on quality demanded along with features developed by R&D department of respective
organisation. Respective report will going to conduct for understanding concept of business
simulation and professional development. This report is divided within two parts, in which
first part deals with simulation which taking place in the confines of Lexo. Along with this,
project will also highlight different aspects of business such as mission, vision, values, HR,
strategy, 5 year progress to financial analysis. Furthermore, it include recommendation and
future plan for business firm in relation of their upcoming 5 years. Apart from this, second
part of report provide detailed reflection report on professional development for recognising
events, application of theories as well as review of industrial practices.
PART A – STRATEGY PAPER
Vision and Strategy of Lexo
Vision of company - Vision statement of Lexo is “To be one of the leading
smartphone company across the globe”.
Values of company - Lexo Smartphone company have its three major core values
i.e., premium smartphone, shaping future technology and innovative.
Apart from this, there are several strategies which Lexo smartphone company is using
for gaining competitive advantages within market area. For an business firm it is important to
design strategies in effective manner as it will help them in gaining competitive advantages
within market area and also in serving customers within effective manner. Explanation of
Lexo marketing strategies are as follows :-

 Cost leadership – For an organisation cost of leadership play important role so in
relation of Lexo using cost leadership aim is to offer best affordable products and
services within market area. In addition to this, respective company look for cutting
cost where possible only keeping the necessities.
 Product leadership – By offering high quality smartphones Lexo can differentiate
themselves within market area. In addition to this, innovation is the key as well as
company use it for offering best and most exclusive smartphones for customers. In
simple term it can be said that, innovative and different product provide assistance to
an organisation in attracting large number of customers.
 Customer focus – Goals and objective of Lexo is to establish a great as well as
lasting relation with customers. Moreover, establishing strong brand identity as well
as chasing innovation will help in making client ambassadors of business. For an
organisation it is essential to make such strategies with the assistance of which they
will able to focus on customers.
By implementing these above mentions three strategies Lexo Smartphone company will
able to gain competitive advantages as well as can attract large number of customers in
more effective manner.
Human Resource –In an organisation human resource is important assets for every
company who is operating as part of economy. This comprises people who are accepting
activities just as endeavours to ensure that the enterprise can accomplish its objectives
and destinations in an auspicious way. Lexo guarantees the strengthening just as
improvement of the representatives by putting time inside them as far as preparing and
advancement, persuasive meetings, workshops and numerous different things. Through
this, the workers are made skilful according to the prerequisites of the organization.
Through the execution of instructional courses, the firm can assemble information on new
innovations and frameworks inside the workers, encouraging an addition in their
inspirational and therefore the profitability levels. In addition to this, within simple terms
it can be said that human resource is important part of an organisation and it provide
assistance in conducting daily basis activities within more effective manner. Along with
this, it also work for the welfare of staff members so that they will feel motivated and
result in improving productivity.

Culture - The corporate culture inside the limits of Lexo is formed contemplating the
reason that inspiration goes about as the way to achievement of powerful and proficient
exhibitions from the workers. Along these lines, the corporate culture of this cell phone
association will in general concentration after imparting dedication inside the
representatives with the goal that they can work in a reasonable and straightforward way.
It advances the idea of equity and decent variety inside the reason of the organization at
all the occasions. The element has built up a culture which endless supply of systems as
per the necessities and requests of clients in the commercial centre. It is important for
Lexo to focus on their culture and design such strategy which hep in building positive
environment. So that better outcomes will gained in effective manner as well as
competitive advantages also.
Review of Each Year’s Progress
Performance of an organisation alters with the passage of every successive year. This
makes it essential for an business firm to review performance every year in order to devise
future course of action in relation of same. Thus, in detail review of every year’s progress of
Lexo company is discussed beneath with the help of Porter’s Five Fore analysis.
Porter’s Five Forces Analysis
Porter’s five force analysis is the framework which help in identifying as well as
analysing competitive five forces which result in shaping industry as well as assist in
determining strength and weakness of industry. In addition to this, five force analysis can be
use by company frequently for identifying industry structure with the motive of determining
corporate strategy. Respective five force model can be applied to any segment of economy
for better understanding the level of competition within specific sector as well as for
enhancing long term profitability of business. It is an framework which provide assistance in
analysing competitive advantages available within market area. Here, five forces are
competition in the industry, potential of new entrants within industry, power of suppliers,
power of customers and threat of substitute products. In relation of Lexo, porters five force
analysis are as follows :-
 Customer’s Bargaining Power – For Lexo customer bargaining power is high
because there are large number of substitutes available within market area. As time
passes it has been identified that respective business firm has become successful in
diluting customers bargaining power with the assistance of leveraging differentiation

strategy within effective manner for developing smartphones which possess
capabilities of disrupt market area. Such strategies result in helpful for company to
instil sense of faith among customers for organisation. Along with this, it also result in
increasing sales and profitability of company.
 Supplier’s Bargaining Power – In relation of Lexo suppliers bargaining power is
low because within smartphone industry number of suppliers are not much which
directly result in low suppliers bargaining power. As the time passes it has been
noticed that for respective industry large number of suppliers has been spotlight which
result in increasing the magnitude of this force for an business firm. Lexo is
maintaining network with numerous suppliers so that it will result in diluting the
extent of this force. In each and every industry suppliers are important part as they
play essential role in supplying raw material to company for so they will be able to
conduct their operations within effective manner and fulfil customers needs and wants
without facing any difficulties.
 Threat of Substitutes – Every industry have some substitutes products which play
important role within working of organisations. For Lexo threat of substitute product
is high because there are several substitutes of smartphones produced by Respective
company. In addition to this, major reason behind high threats of substitute for Lexo
is the high competition firms which are operating within confines of smartphone
sector. Although, Lexo able to maintain their sales performance relation of
substitution effect with the assistance of competent as well as skilled staff members.
Along with this, it is important for an organisation to focus on the competitors
available within market area so they will be able to make such strategy which help
them in gaining competitive advantages available in market.
 Threat of New Entrants - The degree of this power in setting of cell phone segment
was low for I-Tech in its underlying stage as innovative information is required by the
organizations for effectively working inside this industry. Nonetheless, as the time has
advanced, it has been noticed that the greatness of this component has expanded as
the elements have picked up information on the innovations. Further, they currently
have the methods through which they can execute the equivalent inside the limits of
the association. This has expanded the test for Lexo throughout time, putting pressure
upon it to use separation technique. Main reason behind low threat of new entrants is
that there is requirement of huge funds for entering in smartphone market. Thus, it is

not possible for every person to invest huge capital and enter within respective market
area.
 Competitive Rivalry – It is related to the competition which available within industry
as within Smartphone industry there are several business firm which competing in
market directly with Lexo. In relation of this, it has been determine that there are
mainly approx. 6 companies who are competing with respective business firm. In
addition to this, performance of Lexo over time evolution has made possible for them
to deal with intensive competition within smartphone sector in present and past both.
Along with this, it also results in diluting threat for Lexo smartphone company. In
simple term it can be said that, for an organisation it is important to design such
strategies with the assistance of which they can sustain in competitive environment
for long term as well as gain competitive advantages within more effective manner.
By implementation of five forcers in effective manner Lexo will be able to gain
competitive advantages within more effective manner. Along with this, they can increase
customer base, sales revenue as well as profitability of company in effective manner.
Market Share: Market share simply refers to percentage of aggregate sales produced by
a company inside a business sector. It is assessed by taking revenue of company over a period
and dividing them by industry's sales over same period. This statistic is used to provide a
general understanding of a business's scale with respect to its competition and its rivals. Share
of market of company is percentage of gross revenue in comparison to industry or sector
where it works. To calculate the market share of company, firstly determine a period, It may
be quarter of a financial year, or several years. As in case of Lexo, Netherlands is main
operational market of company in which total segment demand is 384000 units which has
been reached to 319334.4 with continuous decline. While in market of Belgium total segment
demand is 432000 in year 2020 which has been declined to 359251.2 in year 2029. In the
market of France in year 2020 total demand is 1500000 which has been declined to 1247400
in year 2029. Company’s more focus is now towards Netherlands market. Company’s
product demand in coming year is continuously declined in almost all the country but here in
most of the segments company’s sales is relatively low which shows that company is
inefficient in satisfying demands in long run. Company should focus on increasing supply of
smartphones in markets to increase their market size or share. changes in the market share
have greater effect on corporations' success in developed or exponential markets where
demand is poor. In comparison, shifts in the market share in growing markets have little

effect on businesses. The complete pie is continuing to grow in industry so business can still
grow revenue even if they lose market share. Selling growth and profitability more impact
stock results for firms in this circumstance than other considerations.
Product/ price analysis: Product analysis relates to examining the characteristics, costs,
availability, efficiency, presence and other attributes of a product. Prospective buyers,
product executives seeking to comprehend the competition and third-party review sites
perform product analysis. Price analysis is method of evaluating whether the negotiated
prices for products is fair and rational, without analysing the actual cost and benefit estimates
used by the seller to arrive at the price. It's essentially a method of matching price to
established reasonableness measures. As in case of Lexo product/price analysis shows that
demand relative to price in Netherland in year 2020 is 1800000 while demand in relations of
quality of product is 240000 which have been reached to 1590435 and 199584 respectively in
year 2029. In Belgium market demand relative to price is 1500000 while demand relative to
quality is around 600000 in year 2020, this level has been reached to 1325362.5 and 498960
respectively in year 2029. In its third and major market i.e. France demand relative to quality
is 1080000 while demand relative to price is 2040000 in year 2020 that have been reached to
898128 and 1802493 respectively in year 2029 with steady decline. The overall analysis
shows that corporations demand in all the three market has been declined over the period.
Company has to focus towards adaption of effective pricing policies and quality of its
products. For certain cases it is practically difficult to determine the precise form of demand
line. There are therefore ways of calculating market exposure to alternative prices. This may
be used for such purpose to check messaging. This may be useful to examine historical data
on prices and quantities. And customer analysis tests are often used, like price evaluations by
customers. Therefore, company should in attempt to enhance the sales should emphasise on
the improving quality of its devices and set price of its products after a comprehensive
research.
Competitors
It is significant for the organizations to pick up information on the opposition winning
inside the concerned business in order to make and execute viable systems as per it. In this
connection, it has been recognized that there are some opponent firms for Lexo in the bounds
of cell phone division which posture direct danger to the maintainability of the organization

over the long haul. Such organizations are recognized to be DHgate, Banggood and many
more. Sound procedures should be formulated by the administration of this cell phone
organization so as to achieve a serious edge over the opponents working inside same division.
This will permit the organization to fabricate its successful picture inside the clients and
adjust according to the prerequisites of the market.
Competencies and capabilities
When an business firm carry out their operations within market area, it is essential for
company to own appropriate competencies and capabilities for better growth and
development prospects. With the assistance and application of these an organisation will
make sure that it will able to cope up with all the complexities which may emerge within the
confines of market place in future course of time. Moreover, with detail of Lexo, it has been
identified that respective corporation have several capabilities and competencies. Because
these play important role in effective execution of operations according to the requirement.
Explanation of these in detailed manner are as follows :-
 High share of market – At current it has been determined that Lexo is conducting
their business operations within range of country. This goes about as one of the most
unmistakable skills helping the element in blowing up its scope among the
individuals. Subsequently, the firm will have the option to give its contributions as far
as cell phones to bigger base of crowd over the globe. By serving an enormous
territory of commercial centre, this cell phone firm looks to improve its incomes and
gainfulness over the long run, so as to accomplish a competitive edge within market
area.
 High product demand - According to the data, it has been recognized that the
interest of the smartphones offered by Lexo is high inside the limits of the
considerable number of nations inside which the firm will in general work. This goes
about as another competency for the association. Nonetheless, it is seen that the firm
can't satisfy the requirements and requests of individuals in the commercial centre.
This holds the ability to hold negative effects for the association over the long haul,
prompting a decrease in the dependable base of its clients. To viably use its
competency, it is monstrously significant for this company to make just as devise
compelling procedure through which it can guarantee the satisfaction of necessities
and requests of clients when they develop in the market. With the assistance of such

system, the firm would have the option to blow up its piece of the overall industry and
furthermore get high satisfaction from its base of clients.
Analysis of financial data
 Income statements: An income statement analysis includes
analysing multiple line items in a report, and also, examining trend patterns in
particular items listed across several times. This research is used to consider a
company's expense system, as well as its potential to make a profit. So, while data
found in this statement is fairly basic, a lot of valuable knowledge can be obtained
from this to better understand the recent financial success of a organization so build
an estimation of its outlook. Over this, each income statement attempts to inform is
crucial for customers to provide a sound knowledge of the historical. As in case of
Lexo company’s income statements show that company’s sales in year 2020 is 0
which has been reached to € 213.708.656,00, € 216.330.865,00, € 384.711.476,00,
€ 483.630.617,00, € 471.941.834,00, € 326.874.152,00 , € 311.535.235,00,
€ 287.652.221,00 and € 263.888.403,00 in year 2021, 2022, 2023, 2024, 2025, 2026,
2027, 2028 and 2029 respectively. While gross profit of company is 0 in year 2020
that have been reached to € 89.594.736,00, € 90.743.142,32, € -72.007.149,37, € -
37.063.829,07, € -17.219.571,61, € -17.515.681,28, € -10.394.230,68, € -6.733.744,48
and € -826.477,13 during year 2021, 2022, 2023, 2024, 2025, 2026, 2027, 2028 and
2029 respectively showing overall declining trend in gross profit as after 2022 there is
negative gross profit in company. Further net profits of company are € -553.000,00,
€ 16.232.089,80, € 26.893.392,72, € -208.553.796,13, € -224.018.214,90, € -
225.127.678,65, € -318.374.745,57, € -353.890.153,78, € -398.824.743,71 and € -
448.954.446,79 respectively during 2020, 2021, 2022, 2023, 2024, 2025, 2026, 2027,
2028 and 2029. Overall analysis here of income statement of Lexo shows that
company is continually incurring losses over the entire period. This indicates that
company’s financial health is not sound.
 Balance Sheet: Examination of balance sheet may be described as an overview
of company's assets, total liabilities and capital. This analysis/review is usually
conducted at specified time scales, such as annual basis. A balance sheet review
method is used to determine concrete estimates relating to the company's sales, assets,
and overall liabilities. From the financial report of Lexo in the 2019, it has been
analysed that in such year total cash would be approx. €519487, while total liabilities

will be around €521187.Business recorded €1700000 in the head of the fixed assets
that same year. The cash increased throughout 2020 to €513591660 when the reserves
were 2100000. It demonstrates that working capital position of the corporation
has increased in the course of the year. This same reports for the 2021 also showed
that the effectiveness of the business in this year has reduced since before the total
cash for company this year has reduced since cash level attained level of 45951711.
Net assets and liabilities for the company for this year are approximately €432909556.
For this year debt as well as other long-term commitments was 12619675. Total data
reveals that overall ratio of company assets and liabilities has steadily decreased from
2019 to 2029, as both the ratio of assets and liabilities tends to decrease. Throughout
the whole period, the corporation's equity has still not been adjusted, but liabilities
and assets are rising and decreasing.
 Cash Flow statements: Cash Flow statement's analysis is evaluation of the revenue
outflows and the inflows of a business from sales, funding expenses and investment
expenses. In other terms, this is an analysis of how firm earns its revenue, where it
comes from, as well as what it implies for the total company's worth. Cash
Flow's analysis/review is technique being used by entities in determining how much
surplus cash they produced to determine value of general companies and local
branches. They usually use Cash Flows Statement, which represents the full cash
received and retired during a time frame from investment, financing and operating
processes and a handful of other findings. As in Lexo company has reported total cash
income of 0, € 188.658.656,00, € 218.580.047,00, € 376.237.294,00,
€ 468.709.064,00, € 654.924.848,74, € 658.248.464,69, € 671.894.495,64,
€ 682.521.578,47 and € 724.066.848,06 during the year 2020, 2021, 2022, 2023,
2024, 2025, 2026, 2027, 2028 and 2029 respectively. While Company’s total cash
expenditure are € 1.503.000,00, € 192.426.566,20, € 205.943.657,36,
€ 588.378.237,10, € 703.679.654,44, € 721.665.794,64, € 658.248.464,69,
€ 671.894.495,64, € 682.521.578,47 and € 724.066.848,06 respectively during year
2020, 2021, 2022, 2023, 2024, 2025, 2026, 2027, 2028 and 2029. The overall analysis
exhibits that company’s overall cash income has been continually increasing while
also company’s cash expenses have also been increasing continuously. Company’s
cash flow position is not so good as the income are low in proportion to the cash
expenses which may lead to adverse cash flow position and event put question mark
on the survival of company in coming year.

Performance analysis
Future plan and recommendation
On the basis of analysis business performance of Lexo, it can be said that the entity
has been weak performance within market area over course of time. Moreover, for an
business firm it become important to implement effective strategy by which an organisation
will be able to accomplish market place. In relation of this, future plans along with the
recommendation for next 5 years are mention below :-
 It has been proposed that Lexo have to conduct market research on continuous basis
for identifying as well as tap opportunities that will provide help to an business firm
in gaining attention of numerous customers as well as fulfilling demand within
required time duration.
Recommendation – For carrying out market research it has been recommended to Lexo that
they should have to hire competent as well as well trained staff members who have good
research skills. So that they will be able to determined growth prosperity for business firm.
These individuals would be able to equip the company with knowledge regarding the key
trends taking place within the area of smartphone industry.
 Also, it is proposed that Lexo within next 5 years they have to take initiatives to
increasing its production capacity. So that, it can produce more number of units as
well as meet the demand emerging in home as well as host market area.
Recommendation:
 For the enhancing of production capacity, it has been suggested to Lexo that they
have to utilise sound technologies or product development strategy in order to elevate
the number of units produced through a business firm. This will provide assistance to
corporation in meeting their customers need and wants within effective manner. The
long term implication of the same will result in generating high profitability as well
as revenue.
PART B – Professional development Reflection Report
Executive summary
Personal development is related to learning carries out for the motive of generating
money and maintaining professional credentials of informal learning opportunities, academic
degree, participation within conferences and many more. This is an reflective account of