Why business games are so much more than just fun
This week I had the pleasure of visiting a business game being run over 2 days for some management trainees.
These graduates came from a variety of functions, including Finance, Marketing, Sales, HR & Operations. It was a really fun day & I was very impressed with how my new associates ran the day.
But beyond the fun, I was struck by what a powerful learning experience this event provided. There were several ways that participants recognised they had learn & grown as a result. So, building on my post about leaders as educators, I thought I’d share my own reflections.
Business games – preparation matters
My first impression was the level of work that had gone into this business game. The scenario was set in an imaginary country within the former USSR. The imagined business manufactured a range of alcoholic beverages and participant teams had been appointed as a new board of directors.
Competitive teams were briefed on the back story as well as provided with sets of financial reports. In addition they were provided with some former external consultancy advice, which they could choose to ignore use wither partially or in fully.
The real star of the business game is the amount of effort that has gone into building a simulation engine. That enables teams to experience years (rounds) of making decisions and then seeing the outcome of them – but more on that later.
It was clear from the start that providing competitive teams with a depth of financial detail and market challenges was going to work well. Delegates form their teams months before arriving and have been required to submit a business plan in advance, so they can be assessed against it.
If you are considering the benefits of a business game for your team, it’s worth discovering how much preparation has gone into its design.
Anyway, I’ve started this post by saying that these 2 days of playing a business game are so much more than just fun. What do I mean? What are the benefits I saw for participants?
Benefit 1: Commercial Understanding
I’ve written previously on the need for greater commercial awareness amongst analysts & data scientists. A well designed business game is a great way to increase those skills.
In the one I attended, delegates had previously been briefed on how to read the 3 key financial reports:
- Profit & Loss Statement
- Balance Sheet
- Cashflow Statement
They were also provided with a lot more detail. Sufficient to enable them to experience the commercial dynamics of HR, Production, Buying, Sales, Marketing & their Assets. Each round (simulating a year), they were prompted to make decisions in each of these functional areas.
As someone who designs & delivers training courses, it struck me how much more effective such experiential learning is. What better way to understand a Balance Sheet than to have to decide when to build up stock, or take on debt to fuel the growth you need to compete?
I think it is also worth saying that the learning about commercial dynamics is also richer because of competition. This brings to life the need for each team to consider what others will do. When updated results are delivered to each team you can see the penny drop about others’ tactics.
Benefit 2: Simulation, learn by doing
That point leads on to why I was so quick to praise the complex simulation engine behind this business game. Much more powerful than financial training or economic theory, is to see what happens when you act.
In a simulated business game, teams have the opportunity to experience the interdependency of businesses. If you are too optimistic about your ability to sell, you’ll be left with excess stock. If you buy market share, you’ll erode your profitability & possibly damage product brands. It you have a ‘fire sale‘ of excess stock, you might just shut out the competition.
When arguing for the importance of Data Science methodologies, I mentioned the need to return to the Scientific Method. One key element of that is closed loop feedback. Such an approach to business games delivers that in spades. Especially when teams have the opportunity to make decisions and see the results of several years of their business.
Rather than it all sound dry & worthy, I should mention that the surprise of results each round is also great fun. Teams are taken by surprise, spot their mistakes too late or are caught out by competitors or market changes.
For the business game I attended there was also a lot of fun at the end. Senior leaders from the client business (where the graduates work) attended in the role of shareholders. Each team then had to present their learning & expected final results. I say expected because no-one knew their final results until they were presented in front of everyone at the very end.
A great way to see the character of different teams & enjoy the fun of suspense. With so many dynamics at play in a business, there is plenty of opportunity for “the first to be last“.
Benefit 3: Team Building & Learning
My mention of team character above is also deliberate. In their final presentations, everyone had to participate. So you heard from every member of each team.
As well as presenting on the decisions they had made & changes since their business plan, they also shared on how they worked together. It was striking how many had learnt as much from this element of the game. Collaboration was the buzzword. But there were also lessons learnt about learning from mistakes, shared mission & persistence.
During the game itself you saw the normal mix of alpha types & introverts attempting to work together. The gradual shift of those with too much confidence & readiness to speak learning they could be wrong. The growing appreciation of quieter members of the team whose warnings had been proven right (well sometimes).
Once again the twin drivers of competitive teams and dynamic simulations created a rich learning environment. Teams had to make a number of detailed decisions each round & then face up to the consequences. A great opportunity to learn that no one is perfect in business. That there is more to be gained from being open to others, willing to make a decision, supportive & not dwelling on the past.
So many businesses I know could strengthen their leadership teams by going through such a shared experience. It built on Tony’s call for personalised learning, by strongly making the case for dynamic learning (including simulation & feedback).
Have you experienced the power of Business Games?
So, I have returned from my experience in Milton Keynes as a big fan of such a well designed business game. I am pleased to have new associates with years of experience in delivering such a rich learning experience.
What about you? Does your teams need to strengthen both their commerciality & their collaboration? If so, get in touch, I’ll happily share more about this business game or at the lest encourage you to find one that works for you. Keep learning!