Lexo: Business Simulation, Strategy Paper, and Development Report

This report provides a comprehensive analysis of Lexo, a simulated smartphone company, focusing on business simulation and professional development. Part A presents a strategy paper detailing Lexo's vision, mission, values, HR practices, SWOT analysis, and a review of its progress over five years, including financial analysis and future recommendations. Part B offers a professional development reflection report, covering key events, relevant concepts, industry practices, and the application of theory. The report also includes recommendations for future practice and research, offering valuable insights into business strategy, market analysis, and professional growth. It covers topics such as Porter's Five Forces, market share analysis, product and price analysis providing a detailed overview of the company's performance and strategic planning.

Business Simulation
and Professional
Development

Table of Contents
INTRODUCTION...........................................................................................................................1
PART A- STRATEGY PAPER.......................................................................................................1
Vision and Strategy of Lexo...................................................................................................1
Review of Each Year’s Progress............................................................................................3
Future plans and recommendations......................................................................................10
PART B - Professional Development Reflection Report..............................................................10
Executive summary..............................................................................................................10
Introduction..........................................................................................................................11
Identified events...................................................................................................................11
Review of relevant concepts or theories...............................................................................12
Review of industrial practices..............................................................................................13
Application of theory as well as practice.............................................................................13
Recommendations for practice and research........................................................................14
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
Business simulation is comprehensively said to be as the set of activities that are
performed by business operators or owner in order to establish their business according to the
market scenarios (Bocciarelli and et. al., 2019). Along with this, it can be later said that business
simulation also provides major support to the business entity in taking rightful and meaningful
decisions which ultimately helps them in accelerating their businesses and maximising their
profitability. Inclusion of simulation activities helps businesses in enhancing their sustainability
within the same sector in rightful manner. Away with this, it is also seen that simulation simply
provides an effective platform to the business developer to enhance their understanding over the
market fluctuation that might take place in the near future after its establishment. Also, it
provides opportunity to the business developer with which they can easily groom themselves and
develop their professional skills.
The present report is based on enhancing knowledge about the concept of business
simulation and professional development. In this, Lexo has been taken as the main entity which
is simulated company that deals in smart phones. The respective entity is also engaged in the
production as well as distribution of the Smartphone. This project is bifurcated into two sections.
In the first section detailed information is provided on the mission, vision, values, HR, strategy, 5
year progress to financial analysis. This also includes future planning as well as recommendation
given to the same company for their coming 5 years. Whereas, the second part of the project
emphasizes on reflection which is given upon the professional development that covers various
areas such as event, application of theories, it also reviews industrial practices and many other
associated areas.
PART A- STRATEGY PAPER
Vision and Strategy of Lexo
Vision and Mission:
The core vision of LEXO is to become best premium Smartphone Developer Company
worldwide.
The mission statement of LEXO is to deliver highly innovative Smartphone to customers
with the usage of advance form of technology.
Values:
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It has been analysed that the main motive of LEXO is to provide premium Smartphone’s
to the customers so that they can easily grab attention of the customers in rapid manner. In order
to do effectively, the management team of the company simply emphasizes on providing highly
innovative Smartphone to the customers (EDUCATION, 2019). For this, the main focus of top
management team to focus on using advance form of technology so best featured smart phone
could be developed for its customers. All of these are considered as the core value for the LEXO.
HR:
HR department is mainly responsible for developing positive relationship among
employer and employees so that both of them can attain maximum benefits and acquire their aim
and objectives in quicker manner. Here, HR manager of LEXO ensures to provide high level of
opportunities to the employees so that they can easily show their complete potential in the
organisational work. In order to do so in effective manner, the HR head provides training and
development sessions, workshops and motivational sessions for the workshop so that they can
easily improvise themselves according to the work (Hernández-Lara, Perera-Lluna. and
Serradell-López, 2019). Along with this, it can be said that regular based efforts taken by the
company simply helps them out in motivating its workforce who directly boost up their
performance and supports in attaining predetermined aim and objectives in rapid manner.
Culture:
The corporate culture of LEXO is highly friendly but still compliance of all legal norms
are compulsory in this company. Also, with friendly working culture employees of the company
feels motivated and focuses on executing their work effectively. Along with this, it has been later
analysed that the effective environment of entity directly develops loyalty among the employees
towards organisation this directly influences them to perform all work with transparency (Gatti,
Ulrich and Seele, 2019). In addition to this, business manager of the LEXO also believes in
including employees in their decision making and strategy formulation process which directly
supports organisation in fulfilling demand and needs of the customers.
SWOT analysis
SWOT analysis is basically termed as the strategic planning technique that is mainly
adopted by the company to develop their understanding towards their own strengths, weaknesses,
opportunities, and threats associated with their own business and the sector in which they are
dealing (Hashim, Razali and Taib, 2019). SWOT of LEXO is specified as below:
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Strength Weakness
 LEXO owes strong brand image at
marketplace which supports them in
maintaining their performance at global
level.
 Usage of advance technology supports
LEXO in bringing innovation in their
product range at regular basis (Bocciarelli
and et. al., 2019).
 LEXO shares strong and positive customer
relations as they provide value to
customers demand and need and further
include them in their product offering in
order to satisfy them at extensive level.
 Selling price of products is higher due to
inclusion of technology which is not
affordable for all group people.
 Distribution network of LEXO is quite
limited that reduces accessibility towards
the customers.
Opportunity Threat
 Expansion of distribution network can be
seen as the main opportunity for LEXO.
 Development of new product lines at
lower prices would develop opportunity in
developing their demand among all kind
of customers (Lohmann and et. al., 2019).
 Increasing labour cost in every nation
could become major threat for LEXO.
 Constantly changing demand of the
customers’ would make it difficult for the
company to meet as they can fulfil each
and every requirement.
Review of Each Year’s Progress
It is highly essential for the business associations to review their performance at each
year so that they can easily analyze their current performance and develop their understanding to
the ways through which they can improvise their future performance (Fekula and Rodriguez,
2020). With reference to LEXO, it can be said that the respected manager of the company
emphasizes on making use of Porter’s five force analysis for reviewing their performance within
the industry at regular basis.
Porter’s Five Forces Analysis
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 Customer’s Bargaining Power: Bargaining power of the customers’ is acknowledged
higher for the LEXO as there are lots of companies available within the same industry
that are offering similar sort of products to customers at approximately same price range.
Here, it is essential for LEXO to focus on making use of advance technology so that they
can easily fulfil demand of customers and attain competitive edge.
 Supplier’s Bargaining Power: The influence of this force is lower within Smartphone
sector as there are lots of supplier who provides similar sort of material to the companies
with which they can easily develop Smartphone (Lazarova-Molnar and Li, 2019). It can
be said that if the supplier of LEXO does not take risk losing their relationship with the
company. For this, they simply get agreed to the provided rate.
 Threat of Substitutes: Threat of substitute within smart phone industry is high as rivalry
existing in this sector emphasizes on introducing new products and services as per
customers demand so that they can easily influence interest of customers towards them
that will provide higher benefits to them in the near future (Draijer, 2020). In order to
deal with this effectively. It is highly important for management team of LEXO to hire
skilled workforce who can easily make use of advance technology and execute their work
in such a manner that will ultimately support them in gaining competitive edge.
 Threat of New Entrants: Influence of this force is relatively low for smart phone
industry as if any company enters into this then they would definitely requires huge
capital to establish the business and give stiff competition to the competitors by attracting
customer’s towards them (Matute-Vallejo and Melero-Polo, 2019). Here, LEXO can
easily take leverage by making use of differentiated strategy by offering completely
unique product that is Smartphone’s to its customers and influence them to remain loyal
with the same company in the near future
 Competitive Rivalry: Smartphone sector is highly competitive as there are lots of
competitors available within the same marketplace. In order to deal with this, LEXO is
required to conduct market research at constant basis so that they can develop their
understanding towards the customers’ changing requirements and can also introduce new
products and services accordingly (Buil, Catalán and Martínez, 2019).
Market share
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The market share is the proportion of the industry paid for by a single individual.
"Markers need to be able to convert and turn the demand goals into market share, because these
would indicate how the projections are to be met by growing the business or by taking the
market share of rivals (Camargo, Dumas and González-Rojas, 2020). In other words, market
share generally relates to the amount of gross profits generated by a corporation within the
corporate field. It is measured by considering the company's income over a span of time and
measuring it by the profits of the market for the same duration. This metric is used to give a
general sense of the size of a company in terms of its competitiveness and its rivals. The share of
the company's business is a proportion of total sales relative to the product or segment in which it
operates. To order to quantify the market share of the product, first decide the duration, it may be
a half of a fiscal year or several years. As in the case of Lexo, the Netherlands is the largest
business sector of a corporation with a gross demand division of 384000 units and a steady
downturn of 319334.4 units. Although the overall demand for the Belgium segment in the
industry was 432000 in 2020, it decreased to 359251.2 in the year 2029. The estimated market
for France in 2020 was 1500000, which decreased to 1247400 in 2029. The company's attention
is now on the Netherlands business. The demand for the company's commodity in the coming
year is gradually decreasing in almost every region, but here, in most segments, the company's
sales are fairly small, which indicates that the business is inefficient in meeting long-term
demands. The business will concentrate on growing the availability of devices to consumers in
order to raise their market value or market share. Changes in market share have a larger effect on
the competitiveness of companies in developing or rising economies where competition is low.
In contrast, changes in market share in can economies had no effect on firms (Costin, O’Brien
and Hynes, 2019). The full pie tends to develop in industry, meaning that even though they lose
market share, company will still raise sales. Sale production and productivity, in this case, has
greater effect on firms' portfolio performance than other factors.
Product / price analysis
Product analysis involves the evaluation of the features, prices, quality, performance, appearance
and other qualities of the drug. Prospective consumers, competition-based sales managers and
third-party testing platforms conduct product research (Alstete and Beutell, 2019). Price
negotiation is a way of determining that the price agreed for goods is reasonable and logical,
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without evaluating the real expense and profit calculations used by the vendor to arrive at the
price. It is essentially a method of price matching the metrics of reasonableness that have been
developed. As in the scenario of the Lexo product / price analysis, the production relative prices
in the Netherlands in 2020 is 1800000, while the demand for the product quality relationship is
240000, which was attained at 1590435 and 199584 respectively in the year 2029. In Belgium,
increased competition relative to price is 1500000, while production comparative to reliability is
around 600000 in the year 2020, at 1325362.5 and 498960 respectively in the year 2029. In its
third and most relevant sector, i.e. France's production compared to cost is 1080000, whereas
output relative to price is 2040000 for 2020 and 898128 and 1802493 for 2029, respectively,
have been gradually decreasing. The overall results show that demand for corporate entities in all
three markets has decreased over the period. Business must aim to evolve efficient price strategy
and the quality of the products. For some instances, it is virtually impossible to decide the precise
shape of the demand rows. There are also methods to quantify the consumer sensitivity to
alternate rates. It may be used to test communications for this reason. It may be useful for
examining historical data on price and quantity (Bitrián, Buil and Catalán, 2020). And market
feedback methods are also used, such as demand reviews by consumers. Therefore, in an effort
to improve revenue, the organization will concentrate on increasing the efficiency of its
equipment and lowering the price of its goods by extensive analysis.
Competitors
It is significant for the organizations to attain information competitivenes within the
sector so that they can easily develop their own strategies accordingly in order to gain comptitive
edge. In relation to this, it has been recognized that there are some competotive firms of LEXO
are directly influencing sustainaility of the company within the sector. Sound strategies are
required to be developed by the administration of this cell phone organization so as to
accomplish competitive advantage within the industry (Matute-Vallejo and Melero-Polo, 2019).
This will permit the company to develop its powerful image customers as they are fulfiling their
needs and requirements in adequate manner.
Competencies and capabilities
It is highly important for the businesses to emphaise on developing their understanding
over competencies as well as capabilities in order to inflate the growth and development
prospects. This would dircetly help busiensses in improvising tehir performance in such a
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manner that contribute in dealing complex situtaions (Buil, Catalán and Martínez, 2019). These
are central to the effective execution of operations of the company as per the requirements. These
are explained as below in well stated form-
High share of market: At present, it is determined that LEXO is carrying out its
business operations in a range of nations. This acts as one of the most prominent competencies
helping the entity in inflating its reach among the people (Lazarova-Molnar and Li, 2019). As a
result of this, the firm will be able to provide its offerings in terms of Smartphones to larger base
of audience across the globe. By serving a large area of market place, this Smartphone firm seeks
to enhance its revenues and profitability in the long run, in order to attain a competitive edge at
market place.
High product demand: As per the data, it has been acknowledged that the demand of
the Smartphones offered by LEXO is high within the confines of all the countries within which
the firm tends to operate. This acts as another competency for the organisation. However, it is
observed that the firm is not able to fulfil the needs and demands of people in the market place
(Hashim, Razali and Taib, 2019) (Lohmann and et. al., 2019). This holds the capacity to hold
negative impacts for the organisation in the long run, leading to a decline in the loyal base of its
customers. To effectively leverage its competency, it is immensely important for this corporation
to create as well as devise effective strategy through which it can ensure the fulfilment of needs
and demands of customers as soon as they emerge in the market. With the help of such strategy,
the firm would be able to inflate its market share and also derive high contentment from its base
of customers.
Analysis of financial data
Income statements:
The review of the income statement involves the study of several line items in the report, as well
as the evaluation of trend trends in individual products that have been observed many times. This
work is used to understand the cost structure of a product, as well as the ability to generate a
profit (Gatti, Ulrich and Seele, 2019). Therefore, although the data contained in this assertion is
relatively simplistic, a lot of useful information can be drawn from it to help grasp the
organization's recent financial performance so as to construct an assessment of its future.
Throughout this respect, any effort to include facts on the income statement is important for
consumers to provide a clear understanding of the historical condition. As in case of Lexo
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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. This is showing that there is decreasing trend in the gross profit after financial year
2022. As well as in the aspect of net profit, it can be stated that this was of € -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 assessment of
Lexo's income statement reveals that the business continues to incur losses over the full duration.
It means that the financial stability of the organization is not good.
Balance Sheet-
Examination of the balance sheet may be defined as an analysis of the properties, total liabilities
and resources of the business (Hernández-Lara, Perera-Lluna. and Serradell-López, 2019). This
analysis / review is typically carried out at defined time scales, such as the annual basis. The
balance sheet analysis tool is used to evaluate accurate measures of the company's revenue,
properties and total liabilities. From Lexo's financial statements in 2019, it was estimated that
gross cash will be roughly in that year. EUR 519487, although the total liabilities would be about
EUR 521187. Company reported €1700000 at the head of the fixed assets in the same year. Cash
rose to €513591660 during 2020 when the deposits accumulated to 2100000. It indicates that the
working capital status of the company has rising over the course of the year. The same estimates
for 2021 have revealed that the productivity of the sector in this year has declined as the overall
cash for the organization declined this year after the cash volume exceeded 45951711. The total
assets and liabilities of the company for this year are roughly €432909556. For this year the loan
as well as other long-term obligations contributed to 12619675. Complete evidence indicates that
the total percentage of business assets and liabilities has gradually declined from 2019 to 2029,
as both the amount of assets and liabilities continues to decline. Throughout the whole time, the
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equity of the company has not yet been changed, yet liabilities and assets are growing and
declining.
Cash Flow statements-
Cash Flow's analysis is the calculation of cash outflows and market inflows from revenues,
borrowing and spending expenditures (EDUCATION, 2019). In other words, this is an overview
of how the business receives its income, where it comes from, and what it does for the net profit
of the product. Cash Flow's analysis / review is a method utilized by organizations to evaluate
how much excess cash they have generated and assess the worth of general corporations and
local divisions. We typically use the Cash Flows Report, which reflects the complete volume of
cash earned and expended over time from expenditure, funding and operational activities and a
number of other results. 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 shows that the total cash income of the
company has been steadily increasing, while the cash expenses of the business have also been
steadily increasing. The cash flow status of the company is not as strong because the income is
small in comparison to the cash expenses and may contribute to an unfavourable cash flow
situation, so the incident would bring into doubt the sustainability of the business over the
coming year.
Performance analysis
According to the overall information stated in the above section, it has been analysed that
the overall market demand of the company are increasing day by day which makes it difficult
for the company to meet demand with the production capability. In order to do so effectively, the
respective company is required to emphasise on developing effective business plan and revise
their strategies so that they can easily tackle the situation and maintain their performance
(Fraccascia and et. al., 2020).
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Apart from this, it has been analysed that the respective company is currently facing huge
competition from the rivalry which is directly affecting their sales performance as well as
profitability. Apart from this, it has been later analysed that there are several issues related to the
organisational functions such as like logistics, finance, marketing, human resources, marketing,
accounting, products development and many more. The main reason behind this is basically
assumed is that past ineffective strategies and policies. In order to deal with this, businesses are
effectively required to emphasise on revising their strategies so that they can easily tackle the
situation in rapid manner and attain success in effective manner within the available time frame.
Future plans and recommendations
According to the information stated in the above section about the performance of LEXO,
it has been acknowledged that the overall performance of the company is not good. This
ultimately creates requirement of takings strict actions and revising their strategies in order to
improvise it in defined manner. Here, it is essential for the company to develop sound strategies
towards the same that would contribute in gaining competitive edge within the same sector.
According to this, few recommendations are given to the company with which they can easily
improvise their next five year performance.
 At first it is recommended to Marketing team of LEXO to conduct effective market research
at regular basis so that they can easily develop understanding on the customers changing
demand and needs. Thus, existing product can be modified accordingly in rightful manner.
 At next, it is advised to the manager of the company to hire skilled staff within the company
only so that they does not have to spent time on training employees and developing their
according to their work.
 Further, it is advised to the company to emphasise on making use of advance technology so
that they can easily improvise their production in rapid manner. This would directly
contribute in enhancing their production capacity and fulfilling demand of the marketplace in
effective manner.
PART B - Professional Development Reflection Report
Executive summary
The following report is a reflection based upon an individual carrying out working in a team in a
simulated setting. The name of the simulated business is Lexo. This is an organisation engaged
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