Post by ironwolf on Feb 28, 2022 9:36:31 GMT
I was not certain whether to put this in game mechanics suggestions or industry suggestions due to this being a bit of a hybrid but I ended up choosing industry since that's what my suggestion is mainly about.
As we all know, running a company at a larger scale entails increased administrative overhead and increased accounting fees, especially more so when considering labour intensive companies.
What I am proposing is that Accounting Fees and Administrative Overhead is instead to be consumed in the form of units. Whenever any of these things is to be consumed, when producing anything with regards to the administration units and daily with regards to accounting units, the game would search for the cheapest source in the market(similar to what it does for construction sans warehouse supplies) and buys them automatically. Of course the company could choose alternatively to use in-house administrative staff which would be far more inefficient and more expensive per administrative unit.
This would enable people to open companies dedicated to accounting and administration which would outsource themselves via the form of selling units to the exchange or via contract.
Now regarding executives, their function would remain the same in that a COO would reduce the amount of administrative units required by percentage and also the same for the accounting units.
This of course calls into question the most important aspect, that being the question of what a unit is worth in value.
Regarding the cost of administrative units, I used www.costowl.com/b2b/human-resources-hr-outsourcing-cost.html as a source to get an understanding of the costs. For the sake of simplicity in the game we are considering the administrative outsourcing companies as being Professional Employer Organization (PEO) type companies which take care of everything regarding administration. Now the administrative unit would be determined as a cost per an amount of employees involved in production per hour. This means that one administrative unit would cover, for example, 100 employees for an hour. So let's take as an example a 600 employee company, this would require 6 administrative units per hour of operation for the 600 employees.
Now regarding the cost of accounting units, in real life, the cost of accounting firms usually takes an hourly rate, in the case of simcompanies this would add a layer of complexity which might make it difficult for players and the developers alike. What I propose instead is that each accounting unit covers a set amount of money in terms of fees. What do I mean? The accounting fees would still be a set percentage of the liquid cash and bonds but it would be paid differently. You can either pay the standard percentage method(in-house accounting) or by units. To make it simpler, I will, for this example, ignore the executive lift given by the CFO so as to make it simpler to illustrate.
Imagine a company which has $6,000,000 in cash and bonds. $3,000,000 of these cost 0.5% in accounting fees. This means a cost of $15,000. Each accounting unit would cover approximately $1000 dollars each. Thus 15 accounting units would be required.
To illustrate why it would be profitable for companies to use this units, let's take the above example. $15,000 of overhead requires 15 units. Now you could either pay the full sum using in-house accounting or you could buy units at $950 a unit. Meaning you would save $750.
In order for this to be balanced though, balancing would mainly need to happen on the side of the companies producing these administrative units and accounting units by increasing labour fees enough but not too much so that the game balance is not thrown out of whack but just enough to be a significant offset that players would see the benefits of outsourcing a company as opposed to using in-house.
The above is just a rough outline for what I think would be a great addition to the game, so as to make costs cheaper for growing companies and to add another avenue from which players can profit thus making this game even more dynamic.
Any criticisms or improvements are welcome.
As we all know, running a company at a larger scale entails increased administrative overhead and increased accounting fees, especially more so when considering labour intensive companies.
What I am proposing is that Accounting Fees and Administrative Overhead is instead to be consumed in the form of units. Whenever any of these things is to be consumed, when producing anything with regards to the administration units and daily with regards to accounting units, the game would search for the cheapest source in the market(similar to what it does for construction sans warehouse supplies) and buys them automatically. Of course the company could choose alternatively to use in-house administrative staff which would be far more inefficient and more expensive per administrative unit.
This would enable people to open companies dedicated to accounting and administration which would outsource themselves via the form of selling units to the exchange or via contract.
Now regarding executives, their function would remain the same in that a COO would reduce the amount of administrative units required by percentage and also the same for the accounting units.
This of course calls into question the most important aspect, that being the question of what a unit is worth in value.
Regarding the cost of administrative units, I used www.costowl.com/b2b/human-resources-hr-outsourcing-cost.html as a source to get an understanding of the costs. For the sake of simplicity in the game we are considering the administrative outsourcing companies as being Professional Employer Organization (PEO) type companies which take care of everything regarding administration. Now the administrative unit would be determined as a cost per an amount of employees involved in production per hour. This means that one administrative unit would cover, for example, 100 employees for an hour. So let's take as an example a 600 employee company, this would require 6 administrative units per hour of operation for the 600 employees.
Now regarding the cost of accounting units, in real life, the cost of accounting firms usually takes an hourly rate, in the case of simcompanies this would add a layer of complexity which might make it difficult for players and the developers alike. What I propose instead is that each accounting unit covers a set amount of money in terms of fees. What do I mean? The accounting fees would still be a set percentage of the liquid cash and bonds but it would be paid differently. You can either pay the standard percentage method(in-house accounting) or by units. To make it simpler, I will, for this example, ignore the executive lift given by the CFO so as to make it simpler to illustrate.
Imagine a company which has $6,000,000 in cash and bonds. $3,000,000 of these cost 0.5% in accounting fees. This means a cost of $15,000. Each accounting unit would cover approximately $1000 dollars each. Thus 15 accounting units would be required.
To illustrate why it would be profitable for companies to use this units, let's take the above example. $15,000 of overhead requires 15 units. Now you could either pay the full sum using in-house accounting or you could buy units at $950 a unit. Meaning you would save $750.
In order for this to be balanced though, balancing would mainly need to happen on the side of the companies producing these administrative units and accounting units by increasing labour fees enough but not too much so that the game balance is not thrown out of whack but just enough to be a significant offset that players would see the benefits of outsourcing a company as opposed to using in-house.
The above is just a rough outline for what I think would be a great addition to the game, so as to make costs cheaper for growing companies and to add another avenue from which players can profit thus making this game even more dynamic.
Any criticisms or improvements are welcome.