Skip Navigation Links



PERIOD 5:  "'VFP Company' are the early pacesetters!"

After a period of intensive trialling the Birmingham City University / CPE (Hong Kong) Enginuity 2024 Competition is underway, with a competitive field of teams all battling for supremacy against their peers. And so to the action, and all the teams made excellent starts, with the early pacesetters after 36% growth being "VFP Company" with 1,355 pts, but they cannot rest on their laurels with the chasing pack not far behind led by the "Excellent Construction Limited". However, it is early days, and there are sure to be plenty of twists ahead as the journey through the Early Years unfolds.

The early signs are that the competition will be very competitive, with all the teams improving their overall position in period 5. However, this was not unexpected. After being formed at the beginning of period 1, overhead costs were incurred whilst the companies were being established, without any profits being generated. The companies were now in a position to generate profits against a more stable overhead base, and this was reflected in improved operating profits. Of course, growth will be impossible without an effective strategy, and all the management teams have had time to think about this carefully, and come up with a set of objectives to deliver business success for their stakeholders.

2023 proved to be another turbulent year for the UK. Food and energy prices rose sharply, caused largely by global supply chain disruptions and the effects of Russia's full-scale invasion of Ukraine, resulting in a Cost of Living crisis in the UK, and the Bank of England were forced to increase interest rates many times to combat rising inflation, with resulting growth of only around 0.4% in the whole of 2023.
Hopes were growing towards the end of 2023 that 2024 could see some green shoots of recovery, with interest rates reaching their potential peak. However, many observers are sceptical with the upcoming general election, and a likely change of Government expected to prolong the uncertainty for businesses and delay investment, and growth is expected to fall to 0.3% in 2024.

Further afield global real GDP grew by around 2.9 percent in 2023, but is expected to slow to 2.5 percent in 2024, weighed down by high inflation and continued monetary policy tightening. Growth forecasts for 2024 are generally strongest in emerging Asian economies, and weakest in Europe and the US.
The outlook is not helped by the continued impact of the Russia invasion of Ukraine, and the Israel invasion of Palestine in the Middle East, all potentially putting further global pressures on energy prices across the world.

League table at the end of period 5

PERIOD 6:  "The 'VFP Group' stay top after a tough period"

After the impressive growth figures posted in period 5, not unexpectedly period 6 proved to be a much tougher quarter. This was largely driven by the companies being unable to win as much work as they had previously, with the corresponding reduction in forward workload and margin KPIs.

There was no change at the top of the table as the "VFP Company", despite a 10% decline which saw their KPI total slip to 1,224 pts, were still able to hold off the challenge of "Star", who moved up one place to second. The "Excellent Construction Limited" had a particularly tough quarter as they failed to win any new work in period 6, which saw their forward workload and margin KPIs tumble, and they will need to look carefully at their bidding strategy to set margins that are competitive enough to enable them to bounce back in period 7 and boost their order book.

With KPI points hard earned it will become increasingly important that the management teams look very carefully at every aspect of their business for potential improvements, and those that are most successful in doing so should prosper the most. Two areas that the teams need particular attention are Marketing strategy and Procurement (rival bidders), which are discussed in more detail below.

Marketing is possibly the area of the business that requires the most thought, as there are numerous strategies that could be adopted. The market trend can only be gauged for one year ahead, and not always accurately, and as marketing departments are expanded, the choices of where to direct the marketing effort are wide ranging, by sector, country and job size. The task is not an easy one, but has a major impact upon procurement options, and the future work undertaken, and ultimately on the long term prosperity of the company.

Another important consideration is that rival bidders do not necessarily stick with the same bidding strategy, and as time goes by they can change their strategy according to market conditions. This makes it imperative that teams keep a close eye on the margins rival bidders are applying, and how they may be changing. Evaluating these strategies could make the key difference between success in securing work, or not. To complicate matters even further there may be UNKNOWN rival bidders, and the only clues to these may be in the ENGINUITY NEWS NETWORK (ENN) for the period.

League table at the end of period 6
Improvements, or otherwise, during period 6

PERIOD 7:  "The 'Excellent Construction Limited' live up to their name!"

Consistency, though not always easy to achieve, is often a winning formula, and this has been demonstrated in the 3 rounds so far by the "VFP Company", who once more continue to lead the Competition at the end of period 7 with 1,279 pts. However, they are coming under pressure from the well named "Excellent Construction Limited", who bounced back strongly in period 7 after winning no work the previous period, but 3 new contract awards bolstered their order book, and resulted in an whopping 18% improvement to move them back into second. With 2 rounds to go it is still all to play for at the top.


A leading industry think tank have come up with a simple formula for running a successful construction business.

  1. IDENTIFY new work
  2. EXPAND the infrastructure (capital base) of the company to take on more work
  3. WIN new work through competitive bidding
  4. PROFITABLY PROGRESS of the jobs won
It sounds so simple in theory, but in practice it is much far harder to achieve. Most teams prove to be more than competent in the first two areas, identify new work and expanding the infrastructure, but the bidding and successful job progression proves more challenging. Winning new work is not easy with so many known and unknown rival bidders working in different sectors and locations, and progressing jobs through to successful completion is hindered many things, such as finding suitable project managers, labour scheduling and overcoming the many obstacles that can occur, such as delays caused by risks strking. Steady growth also requires replacing work progressed with at least the same amount of work again, and this is often the hardest factor of all to get right. The teams can take some comfort from knowing that many management teams in the real world also struggle for consistent growth, and at least in the virtual world it is not critical, although it may feel like it at times!

Another essential part of running a successful business is being able to form an effective Risk Management Strategy to keep the business as profitable as possible. This can take a number of forms, firstly by building sensible risk contingencies into the original bids based upon the likelihood and cost of the risks occurring. Secondly, and just as importantly is mitigating the affects of any risks that strike through targeted investment into risk management companies, using a BIM model if available, and employing the most suitable project managers to jobs in progress. However, even when these mitigating actions are taken, risk can still be costly to job and company profits, and during period 7 problems with structural defects affected the construction of a new health spa for the client, Orlando Adventure World, in the United States, with an estimated risk cost of around 280k before mitigation.

League table at the end of period 7
Improvements, or otherwise, during period 7

PERIOD 8:  "All change as 'Star' turn the Competition on its head"

In an incredible turn of events the Competition was turned on its head as the leaders for the last three rounds, the "VFP Company", failed to win any new work in period 8, which saw their forward workload and margin KPIs fall significantly, resulting in a 14% decline. This opened the door for "Star" to post the only postive growth figures, a 5% improvement, which enabled them to leapfrog the teams above them to become the new leaders with 1,159 pts.

With just one round it is going to be a titanic finish with only 61 points separating the leading three teams, and every decision will count in the final reckoning before the 2024 Champions are known.

League table at the end of period 8
Improvements, or otherwise, during period 8

PERIOD 9:  "'Star' just hold their rivals to become the 2024 Champions"

In a dramatic final round, in which all 3 teams grew by an astonishing 19 or 20%, it was "Star" who just managed to hold off their rivals to become the Birmingham City University / CPE (Hong Kong) Enginuity 2024 Champions with an impressive finishing score of 1,394 pts.

In the end there were no changes in position in the final round as the "Excellent Construction Limited" finished Runners Up, and the "VFP Company" third, and in the final analysis all of the teams finished with stronger, more sustainable companies than when they took over in period 5, a testament to the skill and application shown by the management teams in what was a roller coaster of a journey through 5 simulated quarters of management.

League table at the end of period 9
Improvements, or otherwise, during period 9

©Virtual Management Simulations