BrnoComp Inc.


BrnoComp has been manufacturing Specialized Computing equipment for over 20 years and it is
headquartered in UK.

The company is active in two main markets:

-          UK – which is a mature and stable market, where the company is well established.

-          Russia - emerging market with a lot of growth potential, but the company had limited
success in breaking through and becoming one of the top players in the market.

BrnoComp currently produces about 80% of its production in own plant in UK, the rest of the
production – about 20%, if coming from an ODM (Original Design Manufacturer) in China.

The units produced in China are on average 3% cheaper (after counting in increased cost of
logistics to ship products from China to UK & Russia).

BrnoComp would like to move more production to China, but due to some quality issues arising, the
transition of more production into the ODM has been slow.

The market is currently experiencing stagnation / slow decline and the competition is starting to
price aggressively which negatively affects the company's margin.

UK is practically a non-growing market and there is a lot of margin pressure on the market.

Russia as a market is underpenetrated and provides an opportunity to BrnoComp, but the results so
far have been relatively mixed and to break-through the company will need to invest in the market
heavily.

BrnoComp is also getting ready to launch a new generation of products.

The new generation brings enhanced capabilities and new features - energy efficiency (the equipment
consumes 15%-20% less electricity) and multi-platform support (can operate and communicate with any
equipment or operating system).

The manufacturing team is finalizing the design, so it would be ready for production in the next
few weeks, but there are still some questions around component reliability and final cost to
manufacture.

Your marketing team is suggesting that there is promising demand in the market, if the sales
department will be able to fully explain the advantages of the new generation to the customers.

Sales is looking forward to the new generation of products as it will bring a competitive
advantage, but is afraid that if it will be priced higher than the current generation and the
customers will only adopt the new product very reluctantly.

As the margin erosion has already hit the bottom line of the company, the Board of Directors has
tasked the CEO of BrnoComp and his leadership team to look at growth opportunities and protect the
bottom line.

The CEO has called his leadership team for a strategic planning session where each department will
present the trends they see with the aim of coming to an agreement on the plan for the next fiscal
quarter.



BrnoComp leadership team consists of:

Chief Executive Officer

Chief Financial Officer

Chief Operations Officer

Chief Marketing Officer

Head of Sales

Head of Manufacturing & Logistics


All departments will be present on the strategic planning meeting represented by the functional
leadership team. The strategic planning meeting will take place on the 28^th of November 2013 on
the premises of Masarykova Univerzita in Brno, room P9.