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PwC Challenge 2015 Case Competition: The Dividenders
- 1. Our Strategy: Pandemonium Technologies November 4, 2015 The Dividenders - John Barrasso, Steven Boccia, Andrew Killian, Daniel Lehman
- 2. Goals: Increase revenues to cover operating costs Maximize cash flows for investment Minimize costs
- 3. Strategic Data Sources Financial Data Non-Financial Data • Increase in gross profit • Increase in research and development costs • Increase in interest expense • Liabilities • Sales • New platforms • Expansion plan • Technological advancement • Customer feedback
- 4. Key Points • Turn around net loss • Expand to new platforms and international markets • Innovate with expertise and technology
- 5. Turn Around Net Loss • Net Loss from 2012 - 2014 • Currently engage in high research and development costs • Liabilities outweigh assets • Develop plan to pay off long term debt • Increase the price of the app
- 6. Expand to New Platforms and International Market • Expand on Android Platform • Renew lease on headquarters in Omaha, Nebraska • Expand to Asia Pacific - Capital City, Tuong
- 7. Expand to New Platforms (1)
- 8. Expand to New Platforms
- 9. Current Leases • Renew lease on headquarters and development studio in Omaha, Nebraska (2) • Phase out California studios until their leases are up (3) COST OF LIVING Omaha, Nebraska United States Overall 88 100 Grocery 96.5 100 Health 101 100 Housing 77 100 Utilities 93 100 Transportation 97 100 Miscellaneous 87 100 COST OF LIVING Long Beach, California United States Overall 158 100 Grocery 110 100 Health 111 100 Housing 262 100 Utilities 111 100 Transportation 111 100 Miscellaneous 105 100
- 10. Asia Pacific - Capital City, Tuong: Expansion SWOT Analysis Strengths: ● Leader in CCDs ● Globalization Weaknesses: ● Cultural barriers ● Short-run expenses Opportunities: ● Economic growth ● Increase Sales Threats: ● Government ● Economic downturn
- 11. Innovate with expertise and technology • Predictive modeling - PwC Advantage • Introduction of an Enterprise Resource Planning System • Customer satisfaction • Restructuring/Division of Labor
- 12. Organization Restructuring • Hire an IT specialist both at the domestic and international headquarters • Divide labor between IT specialist and Stephanie Toronto, Director of Operations
- 13. Thank You! Q & A
- 14. Works Cited http://www.idc.com/prodserv/smartphone-os-market-share.jsp (1) http://www.bestplaces.net/cost_of_living/city/california/long_beach (2) http://www.bestplaces.net/cost_of_living/city/nebraska/omaha (3)
Editor's Notes
- (Andrew) In order to advance in new technologies, creating a competitive advantage.
- (Andrew) How do we use this information for decision making?
- (Andrew)
- (Dan) Research Development Costs make up 65% of total operating expenses. Long Term Debt has been at a constant $13 million since 2012. Many of the top 20 Apps are over $1.00, including Minecraft which is $6.99, we can increase the price 30 cents -$1.00, people will still purchase it. *Net gains will raise revenue In-app purchases and advertisements
- (Dan)
- (John) As of Q2 in 2015, Android has 82.8% of the worldwide smartphone OS market share (Apple OS has 13.9% and is decreasing)
- (John) In the US, Android has roughly 50 percent of the market share versus 45 percent for Apple
- (John) Renew lease on Omaha, Nebraksa – 125 employees High standard of living and minimum wage in CA Silicon Valley poses threat to competition and leakage of R&D Incentivize California employees to come to Nebraska or have them work from home wirelessly. (6 hours North of Whittier and Long Beach, CA)
- (Steve) Strengths: Leader in CCDs means that Tuong has experience with technology, technologically savy. Taxes- No taxes on dividends from foreign subsidiaries and corporate income tax rate is lowered from 20 percent to 16 percent tax rate (39% in the US) Business risk - risky to operate in only one country, if the United States economy is negatively impacted it could ruin a firm, but if they’ve outsourced to another country they could manage to stay afloat. Opportunities: Economic growth- more room for economic growth with high unemployment rates and inflation. i.e. hire more people through pandemonium technologies, knock down the unemployment rate. Increased Sales 96% of the world’s population lives outside of the U.S. Weaknesses: Cultural barriers- language barrier, new environment, cultural practices, traditions. Short-run expenses- transportation costs, moving assets abroad. Threats: Government- government interference with business policy as well as changing tax laws could harm the firm. Economic downturn- If economic growth is halted and the economy undergoes a recession, high inflation rates.
- (Steve) How do we access this data? -Predictive modeling - creating a statistical model of future behavior, involves forecasting probabilities and trends based off of data analysis. ---PwC has the strategies in place to help you increase you returns on investment ---Goal: Apply advanced analytic techniques to solve a critical workforce problem and thereby, demonstrate value of talent analytics to the entire organization. -ERP system that maximizes efficiency among divisions/employees and reduces selling/administrative costs. -Customer satisfaction - Stephanie’s Inbox (“we purge all non financial data within 90 days… should we reconsider?”) 90 days is fine within the understanding that it is being tracked within 90 days by R&D and make ‘note’
- (Dan) Hire IT specialist that can capitalize researching and developing the latest, cheapest technologies.