Business Simulation Games have been played by universities and business schools since the 1950s. Since then, they have been a valuable learning tool for teaching management and also for executive development in organizations. The University of Washington used business simulation games in classes as early as 1957. Way back in 1958, Andlinger mentions three objectives of management games:
a) Education & training of management competencies
b) Analysis and testing of decisions & strategies in companies
c) Research
Differentiating problem solving games from teaching games, Andlinger observes, a problem solving game is one in which the objective is to arrive at an approximate answer through repeated trials. ‘A game simulating four competing gasoline stations, for example might give the players considerable insight into the probable effect of alternative retail pricing strategies’ (Andlinger 1958b: 148). About teaching games he writes in the same article, ‘A teaching game on the other hand, has as its main objective the demonstration of already existing insight or principles to participants.
Cohen, Cyert, Kuehn and Winters observed in their 1960 paper, the Carnegie Tech Management Game ventured to seed the following abilities in its participants:
i) Abstract, organize and use information from a complex and diffuse external environment
ii) Plan and be progressive
iii) Combine the role of a generalist and a specialist
iv) Work effectively with others. In 1964, they added another element: The ability to set goals and define them in an operational manner.
Burt Nanus, Director of Western Systems Training Center says in his published article of 1969, that good management games serve to:
a) Ensure an exceptionally high degree of involvement of participants in the learning situation
b) Demonstrate management principles, statistics & case studies
c) Demonstrate problems of decision making
d) Demonstrate the use of management tools
e) Represent effective simulations
f) Provide through the way the game is designed, excellent insight into company relations
The need to prevent a game from becoming play was highlighted even in the 1950s and 60s. Andlinger (1958) said ‘Games are as old as man. Usually their basic objective is entertainment.
The business management game, however, aims not at entertainment but at learning. Other differences between it and a game like Monopoly for example are: The degree to which it approaches reality and the degree to which the players experience judgement and skill – as opposed to luck – influence the outcome. If a business game is to serve a purpose beyond that of being a fascinating toy, there must be some transfer of learning from the game situation to reality.
Andlinger also wrote about what unites management games and games of entertainment. He said, both involve conflicts or competition, incomplete information about game rules or about opponent’s strategy, and uncertainty about the result as a consequence of the actions of the opponent or an element of chance. He added a ‘high degree of emotional involvement’ as a common feature.
Andlinger (1958) also illustrates a typical management game board of the 1950s. Sized about 20 by 30 inches, a game board represented ( see illustration below) the operations of a company.
The left hand side of the board represents the market, wherein the shaded areas are urban markets, the white areas are rural markets. Each square represents a Customer. The right hand side represents operations, the spaces in the vertical columns signal that decisions made during a time period do not become effective until sometime in the future. At the beginning of each period all operations move up one space.
Business Games have played a vital role in embedding competencies across the organizational hierarchy for over six decades. As Andlinger said it in 1958, they generate a high degree of emotional involvement among the participants. That makes Business Simulations a game changer in people development.
- Extracts from: Andlinger (1958) | Cohen, Cyert, Kuehn and Winters (1960 & 1964) | Nanus 1969.
- More detailed reading in the book ‘Power at Play- The relationships between Play, Work and Governance’ by Niels Akerstrom Andersen, Professor in Public and Political management, Department of Management, Politics and Philosophy, Copenhagen Business School (CBS)
