Finance: Running a XYZ Company


Simulation software in business management has radically challenged the traditional methods. They employ technical entertainment principles and creativity to ensure successful and complex problem solving (Yasin and Hafeez, 2018, p. 53-56). By simulating managerial dilemmas and situations in business, it has been possible to develop and implement various strategies in a secure and a realistic environment. Unlike the old learning methods, simulation software enables the user to view the potential effects of one’s strategies and decisions (Aguilera-Castillo et al., 2020, p. 129).

Moreover, the framework enabled me to try, fail, but still try again until the learning objectives have been actualized. It helped to bridge the gap between classwork theory and the real-time applications. This report presents a twelve-month business simulation program. The company was named XYZ, and it provided insights and awareness on how to run a firm and boost its growth. The customer segment comprised technological companies whose customers were also divided into various groups based on demographic factors such as age, gender, purchasing behavior, priority needs and interest.

From the program, it has been easy to address customer feedbacks when conducting market research, promote the business through various advertising techniques, and earn profit. Running and managing the business requires creativity, technical capabilities, business knowledge, communication skills, and problem-solving abilities.


Various approaches were used to promote the business and win customer loyalty. First, consumer segmentation enabled company XYZ to target large corporations which required large quantities of the product. Their consumption behavior was identified based on age, gender, interests, and purchasing habits. The step was successful because the researcher first identified the data to collect, gathered such information from relevant resources, analyzed them and established effective communication between customer service and marketing units in the business. Choosing large engineering corporations was appropriate because their demand for the subject product was high. As a result, there was a steady flow of income for company XYZ.

Value proposition was also necessary during market research to gather information on consumer behavior. The proposed values include high quality and customer-satisfying performance. For instance, listening to their feedback would enable the company to address specific needs, winning more buyers (Eger and Micik, 2017, p. 142). Part of performance was setting competitive prices to outcompete rivals. Further, the company focused on building great customer relationships to win their loyalty.

Using trade magazines and newspapers, Company XYZ has built a wider customer base. It ran the promotion for two months and it enabled the organization to familiarize itself with the customers’ desires. In this course, some customers noted that company XYZ over prices their goods; hence, it was responded to by offsetting the price by $80 to increase sales and still maintain a substantial profit. As the company grows, the prices would still be reduced to ensure that products are affordable to all buyers.

Transactional sales were the instrumental channel in helping company XYZ to reach consumers. Through this method, customers were encouraged to order their products through telephones calls and then collect them from the company’s pickup stations or its operational premises (Vasilev and Kehayova-Stoycheva, 2017, p. 149-155). It enabled company XYZ to establish long lasting relationships with buyers, keeping customers coming again, and remaining loyal to the organization.

Financial Highlights

Company XYZ chose to approach an overdraft bank of $20, 000 for the business startup. The initial capital was $30, 000, including the money that it spent on market research before borrowing from the bank. In the second month, the company intensified promotion through the earlier mentioned trade magazines and newspapers, amounting to $3200. This step increased sales, earning more profits to the organization. In the third month, company XYZ changed its product supplier, after noting that the initial one charged higher prices. The second supplier sold its computers at significantly lower prices, enabling the company to offset its costs per unit.

Prior to this realization, the company had lost a few customers who thought the products were extremely expensive. Therefore, it incurred $1050 more to conduct further market research to improve sales performance. The study showed that XYZ did not perform well due to high prices. It therefore, utilized the advantage of the cheaper supplies to reduce prices by $150. In response, the company’s sales rose drastically and many customers became loyal and referred their peers to the company.

As the first year nearly ended, company XYZ had succeeded in large sales volumes and it ended the year with cumulative income of more than 500 pounds, amounting to over 3500 pounds. The financial analysis and performance was necessary to evaluate the company’s sustainability. The assessment showed that after making drastic losses in event of initially losing customers, company XYZ started again by making a profit of close to $30.

Jan Feb March April May June
sales 250 500 750 0 0 4000
Additional sales 15 15 20 10 25 25
Total income 265 515 750 10 25 4250
Negative sales cost 240 450 730 0 0 1200
Gross profit 25 65 20 10 25 3050
Wages 0 0 0 0 0 150
Rent 15 15 15 15 15 35
Marketing 1050
Financial analysis 100 0 0 0 0 0
Miscellaneous 30 50 40 40 0 25
Profit -90 -1050 -5 -15 20 1890

Figure 2: the Company’s financial report and cumulative profits.

The analysis shows that company XYZ faced tremendous challenges but it struggled to maintain it production levels and sales in the first half of the year. The company also saw negative cash flows because it employed one person to manage financial reports, leading to poor performance and huge workloads. Therefore, it had to incur additional recruitment costs to resolve the issue. As the initial period ended, the company calculated its financial ratios and analyzed them as follows (My Accounting Course, no date, par. 5):

Return on Capital Employed (ROCE) = Formula

3500/3000= 1.7 per cent

Since the company initially had $ 12000 before borrowing from the bank, the ROCE reveals that it generated substantial amounts of profit despite experiencing challenges with pricing in the first ha half the year. In the long run, the company would not require external funding, as the profits were significant enough to cater for expansion. Company XYZ’s financial forecasts revel that it can make close to double the amount of monthly sales made in the first year. This is possible because the company could make up to 30 sales per month due to the strong promotional strategy it initially implemented.

Balance Sheet from the SimVenture Software.
Figure 1: Balance Sheet from the SimVenture Software.

Human Resources

Human resource managers are responsible for adding value to organizations and promote their ethical success. They should accept and uphold professional responsibility for individual actions and decisions. Company XYZ advocated these roles by engaging in activities that enhanced value and credibility. Various principles were portrayed in the organization’s production life. It upheld intent through good quality products and served customers with respect to increase organizational credibility.

By applying the new knowledge, the company noticed that one employee was facing burnout issues and it planned to add more. It was able to expand its workforce to reduce workload and improve productivity. For example, it recruited a new accountant to assist in monitoring the company’s financial records. The company also considered using employment contracts when recruiting future workers. The reason it opted so was to ensure that it had control over when and how staff took holidays to avoid work off when they are required at work (Lisi and Malo, 2018, p. 91-98). Company XYZ benefited from this step because workers minimized the number of paid leaves, while employees had less overtime schedules.

As part of human resource management process, Company XYZ employed the framework, which focused on (BC Campus, no date, par. 2-6):

  • Positon and strategies.
  • HR planning and forecasting as well as jo analysis.
  • Workforce recruitment.
  • Workforce selection.
  • Training and development.
  • Performance and evaluation.
  • Benefits and remuneration.
  • Evaluating human resource outcomes.
  • Retention and turnover analysis.

The framework ensured that it developed and retained high performance employees. The process had to be sequential to ensure that employees were selected and assigned tasks, the trained and paid. This framework adhered to the conventional human resource planning and job analysis design. In the long run, it fostered the development of knowledge and skills, loyalty winning among employees and customers, as well as performance improvement. The step that Company XYZ employed was career fair, which enabled them to provide information for potential employees and sold its good impression to them. Candidates interacted with the company’s executives and asked questions to receive appealing responses on the needed job. Company XYZ planned that, in the future, it would utilize job fairs, where potential employees would contact the company online.

Throughout the first year, the human resource department ensured effective recruitment and selection, as well as team working. The company used evolution to assess commercial and business acumen before hiring workers. This approach enabled them to analyze data, make decisions, and evaluate consequences. Working remotely, they used team assignments to test interpersonal and business skills among job seekers.

For its current and future plans, the company decided that it promotes an active learning environment and outsources specialized trainers to monitor progress remotely. It also enabled the company to change settings, such as location to cope with challenges and assess regular performance. The technology could support large-scale events where employees competed for award winning, or collaborated for unified success.


Effective logistics and operations management were crucial business improvement methodologies for company XYZ to maintain a competitive edge. Its supply chain management and logistics department ensured that it acquired products, approved them, and delivered to consumers at the right time, meeting their needs to keep them coming. Logistics refer to the management of flow of items from the supplier to the consumption point, meeting specific requirements, including corporation or customer needs. Such resources include abstract ones, such as time, energy, and particles, as well as physical items such as equipment and liquids.

Company XYZ focused on physical goods logistics, which included integrating the flow of data, proper material handling, attractive packaging, timely transportation, safe warehousing and transportation, as well as security of customer and supplier information. SimVenture simulation software enabled the company to model, analyze, visualize, and optimize the complexity of its logistics. It was motivated by minimizing capital resources because the company deals in expensive commodities.

Through product planning and control, the company was able to bridge the gap between demand and supply, to ensure that processes are efficient and effective in satisfying customers. This management facet required timely changes to meet organizational goals. For instance, company XYZ introduced in-house production, as opposed to outsourcing its products. Additionally, the company anticipated to raise its prices following the increased demand for electronics in the region within which it operated. It also planned to utilize employment contracts when recruiting future employees. As stated earlier, the organization had employed one primary operator and it had to add more workers to reduce workload and improve productivity.

Moreover, the company changed its operational location after identifying regular and increasing customers. As schools resumed studies, company XYZ earned additional sales of more than 30 products. Customers appreciated and became loyal to the company because it reduced travel distance, helping them to save on cost. It was able to establish and maintain stronger relationships with buyers, apart from upholding product quality for them.

Key operational data in the project.
Figure 3: A screenshot below shows key operational data in the project.


SimVenture was a business simulation technology that facilitated virtual development of company XYZ, and engaged the operator’s mind in ensuring a meaningful learning process. In the course of this project, the software provided a clear business context for students and tutors, demonstrating how various business disciplines, including human resource management, marketing, as well product planning and logistics fit together. It enabled the operators to multitask by managing money, observing time, developing skills, and watching their stress kevels to identify any potential downfall in running operations.

The software inspired the user’s development of critical thinking as it offered the opportunity to practice and fail before realizing the best strategy to run a business. Employing this technology promoted teamwork and appropriate decision-making when handling operations in a coherent and easy to understand manner. The figure below shows a screenshot of how the interface appeared.

Simveture interface.
Figure 4. Simveture interface.

The richness of information contained in the program facilitate handling a breadth of issues, as well as monitoring and evaluating business progress. For instance, it was possible to note the losses the company made while prices were high, and it was also easy to adjust by reducing prices and changing the supplier to the one who offered products at lower prices. The save and load function in the software allowed the operator to test different decision-making options. Its primary features include authenticity and engagement, which ensured sustainable learning, flexibility and varied technical and contextualized support. Data used to communicate with the board included demographic characteristics, profit, loss, total income and sales. Other data was not used in decision-making. The information applied was exported to Excel software for analysis.

Related technologies include Zoom Simulations, Capsim Cesim Global Simulation (CGS), which can facilitate appropriate business data analysis. Like Simventure, it is an instructor resource in corporate settings and school programs. Millera et al. (2018, p.188) studied CGS and found that more collaborative groups spent much time in the simulation, achieving higher game positions, which are connected to market positions in business. The software established co-occurrence networks with phrases organized by variable headings as displayed earlier in the screenshots. They also have a special differentiation structure, where the teams exhibiting it scored higher in the simulations.



The project focused on engineering segments, where company XYZ manufactured and sold personal computers. It utilized consumer segments based on needs, interests, age, gender, and spending habits. The first four months faced significant losses but its downfall was used to conduct a market research that facilitated strategic planning. Afterward, the company noted consumer needs and change its location. It changed its pricing strategy to meet their desires and increase sales volumes.


Simventure business project enabled me to run a six-month simulation for company XYZ. Through it, I learned how to operate and maintain a business, while boosting its growth. The experience enabled me to learn that several issues are factored in when running an organization.


The SimVenture project enabled me to gain insights on how to run a business successfully. It also emphasized why and how to focus on customer satisfaction, which might need operational restructuring. Overall, I was satisfied through the project and I advocate for its implementation in basic and advanced learning stages.


During Company XYZ’s operations, it was noted that many decisions were needed to attract and maintain customers, as well as to earn sustainable income. Each step taken affected the organization’s performance, for example, lowering prices, employing more workers, and changing its location, while maintaining customer satisfaction. Moreover, responding to consumers’ feedback was necessary to maintain the current customers and receive referrals from them.


I would conduct intensive market research to ensure that I familiarize with the ruling market prices to avoid making losses, which company XYY made before realizing cheaper products and setting affordable prices.

Action Plan

The framework can be used in the future product design at company XYZ.

Reference List

Aguilera-Castillo, A., Guerrero-Cabarcas, M., Fúquene, C.A. and Rios, W.F. (2020). ‘Simulations in Business Education: A Case Study of Cesim™ Global Challenge’, In Teaching, Learning, and Leading with Computer Simulations (pp. 128-158). IGI Global.

BC Campus (no date). Achieving high performance through human resource management. Web.

Eger, L. and Mičík, M. (2017). ‘Customer-oriented communication in retail and Net Promoter Score’, Journal of Retailing and Consumer Services, 35, pp.142-149. Web.

Lisi, D. and Malo, M.A. (2017). ‘The impact of temporary employment on productivity’. Journal for Labour Market Research, 50(1), pp. 91-112. Web.

Millera, A.H., Vermab, S., Alloghanic, F. and Alwahabid, S. (2018). ‘Analysing the Use of Business Simulation to Build Entrepreneurial Leaders: The Case of UAE Learners’, International Journal of Creativity and Learning, 9(9), pp. 183-209. Web.

My Accounting Course. (no date). Return on Capital Employed. Web.

Vasilev, J. and Kehayova-Stoycheva, M. (2017). ‘Sales analysis by the rectangle method’. Leonardo Electronic Journal of Practices and Technologies, 30, pp.149-160. Web.

Yasin, N., & Hafeez, K. (2018). ‘Enterprise simulation gaming: effective practices for assessing student learning with SimVenture Classic and VentureBlocks’, in Denis, H. and Elizabeth F.C. (eds.) Experiential Learning for Entrepreneurship. Cham: Palgrave Macmillan, pp. 51-69.

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