Abstract
Simulations are a form of competitive training that can provide transformational learning. Participants are pushed by the competition and their own desire to win as well as the continual feedback, encouragement, and guidance of a Business Coach. Simulations enable students to apply their knowledge and practice their business skills over and over. Taken all together, these conditions help students develop their competence in marketing and business. Competitive business simulations are inherently valuable learning experiences, but this potential can be greatly enriched. The purpose of this article is to summarize the development process of a modern business simulation, illustrating how a valued pedagogy can be enhanced through careful planning and thoughtful consideration of the goals, strategy, features, and benefits of the learning experience.
Keywords
Introduction
Business schools take pride in their ability to impart knowledge through lectures, textbooks, exams, and other traditional pedagogical tools. But, knowledge is not skill. To become skillful in a sport, with a musical instrument, or even running a business, practice is needed.
We have also seen from the sporting arena that a good coach can reduce the amount of practice needed to achieve a certain skill level and/or can enhance the skill attained. And, placing people into competitive situations can energize their spirit and drive individuals and teams to higher levels of performance.
Computer-based simulations have had a long history in business education. Educational scholars have frequently noted their efficacy. For example, Stephen, Parente, and Brown (2002) described the value of business simulations in a capstone, integrative course. Furthermore, Faria (2001), Feinstein and Cannon (2002), Gosen and Washbush (2004), Stephen et al. (2002), and Wolfe (1997) have concluded that business simulations are effective due to the realism and control that they provide. Burns and Gentry (1992) and Brooks, Burson, and Rudd (2006) have observed that computer simulations offer students very robust experiential learning opportunities and benefits.
Vogel et al. (2006) observed that simulations and games may be more effective in helping students learn because they stimulate the learners’ cognitive processes. To this end, Lovelace, Eggers, and Dyck (2016) found that participation in a simulation was an effective way to develop critical thinking skills.
In her review of experiential learning, Myers (2010) found the key benefits to be increased student involvement in the learning process, heightened instructor and student enthusiasm, improved student performance on graded assignments, increased student enjoyment and perceived value of the learning experience, and student confidence and competence. It is no surprise then that Mottner (2009) observed that “Competitive, computerized, marketing simulations have been widely used as a teaching and learning tool—particularly in Marketing Strategy and Management courses—and continue to be a meaningful pedagogical tool” (p. 1).
Central to all of these critical reviews is one thing—simulations are exceptionally good at transformational learning resulting from incremental knowledge acquisition. During each decision round, students make decisions based on whatever knowledge they hold about marketing and business. When they receive the results, they discover that the world, including their competitors, did not behave exactly as expected. By studying the inputs and outputs, they try to discern cause and effect, resulting in an updated knowledge base. With this updated information, they consider their options going forward, make projections as to the probable outcomes, and choose a set of tactics that they believe will yield the best results. In short, they test what they believe is true. With each decision round, they cycle through this test–evaluate–revise sequence of knowledge acquisition, generally improving their outcomes, and reinforcing knowledge retention.
The whole process is postulated by Kolb and Kolb’s (2005) theory of experiential learning and widely recognized in the literature. See, for example, Lovelace et al. (2016), Batko (2015), Petridis et al. (2015), and Kickmeier-Rust, Hillemann, and Albert (2014).
Purpose
The author has developed several simulations and a pedagogy that seeks to convert knowledge into skill through hands-on practice in a simulated, entrepreneurial business where students compete for resources, markets, and profits under the watchful eye of a Business Coach. The ultimate goal is to develop the students’ competence through the combination of advanced knowledge and skill.
The purpose of this article is to summarize the development process of a modern business simulation and illustrate how a valued pedagogy can be enhanced through careful planning and thoughtful consideration of the goals, strategy, features, and benefits of the learning experience.
In 2005, the author laid out the strategy for a major revision of the Marketplace® simulation (Cadotte, 2005). Starting in 2010, the software saw another major revision that included a graphical interface with animated videos to inform, educate, and entertain students, ultimately becoming Marketplace Live®. Currently, we 1 are engaged in yet another major revision that revolves around the creation and marketing of carbon fiber bicycles that are custom produced for each customer using 3D printing in a distributed manufacturing setup. Although this article builds off of the 2005 article, the design strategy was refined leading up to the 2010 release and is being refined even further today.
The classroom pedagogy that has evolved in concert with the simulation is discussed in Cadotte and MacGuire (2013) and Cadotte (2014a, 2014b). Although the two in combination provide the best learning opportunity, there is not sufficient space to review the classroom pedagogy here. The reader is encouraged to consult the cited articles for a complete picture.
Finally, there are many marketing and business simulations. For a comparative analysis of 17 simulations, see Batko (2015). He was especially interested in “the most effective features, elements and inclusions within simulations that best assist in the achievement of learning outcomes and enhancement of the user experience” (p. 2). His work provides a good benchmark for comparing the work presented here with that of other simulation authors.
Pedagogical Goals
Seven pedagogical goals guide the work in the creation of the marketing and business simulation. See Table 1. These goals are derived from listening, watching, and discussing simulation-based learning with hundreds of faculty and thousands of students throughout the world. The observed patterns of human behavior on which they are based have remained quite consistent from well before their articulation in the author’s 2005 article (Cadotte, 2005). With the addition of the continuous improvement goal, these goals drive all development efforts.
Pedagogical Goals.
Our number one goal is to maximize a business simulation’s learning potential. Simulations are often seen as transformational experiences because through them students are able to internalize many business concepts, principles, tools, and ways of thinking. We want to take this inherent strength of simulations and optimize it in order to achieve levels never realized before.
For our second goal, we want to create a learning experience that provides knowledge and experience that will be highly relevant to the student’s career. The takeaway know-how should significantly enhance the student’s ability to do his or her job after graduation. We are not only interested in abstract knowledge but also in concrete, hands-on skills.
For our third goal, we want to make it easy to teach and learn. Simulation adoptions have increased in recent years due to the emphasis on experiential learning by accrediting bodies. However, simulations have not been easy to use. Students are often faced with endless tables to analyze, little direction on how to put the pieces of the puzzle together, and no real narrative to hold their interest. They are pretty much left to their own devices to chart their path through the maze of information and decisions. We believe that students should focus their energies on strategy, information, decisions, and the like, rather than be distracted by busy work.
Perhaps the greatest hindrance to adoption has been that faculty perceive simulations as requiring too much work. With a simulation, faculty do not teach so much as they coach. They must help students understand the market in which they compete, the options that are available to them, and the implications of their choices. Instructors are fearful that they will look bad if they do not know what is going on and how to help students improve their performance. In an environment where the publication of scholarly research is the number one goal, less labor intensive learning options tend to take precedence.
Ideally, instructors should not have to worry about the mechanical aspects of managing the simulation. Moreover, they should have, at their fingertips, all of the information they need to successfully coach their students toward a meaningful learning experience. If anything appears to be lacking, the instructor needs a service center to quickly handle all questions. In short, there should be very little for the instructor to do other than provide guidance to their students and monitor the results.
Our objective to make simulations easier to learn and teach is designed to address what we perceive as the single greatest barrier to adoption—the steep learning curve of most simulations.
For our fourth goal, we want to make the learning experience more fun. Simulations are inherently engaging, but we think we can make them more so. We want to add more graphics and animations to the interface and data presentation as well as personalize the graphics and messages for the students.
For our fifth goal, we want to give instructors a choice in selecting a simulation that fits their course/learning objectives. One size does not fit all. A single simulation cannot be optimal for all courses and learning situations. Therefore, we want to create a family of simulations where each has a target course for which it has been optimized.
Our final goal is to continuously improve all aspects of the software and pedagogy. There is no such thing as a finished simulation. Authors and developers can see more improvements that need to be made, even when they are ready to release a simulation to commercial use. There will also be feedback from students and instructors, such as, how information could be added or better displayed, how the addition of another option would make the decision more realistic or easier to understand, how some aspect of the market does not respond as one would expect, and so forth. Advances in computers, mobile devices, the Internet, programing software, graphical design, and animation also continually emerge, creating opportunities and permutations that were not possible even a couple of years ago. Finally, it is possible to improve the learning experience by appending assessment tools, micro simulations, mind maps, blogs, badges, and other classroom activities that address weak points or amplify strong ones. If there is nothing else that we have learned since 2005, it is that continuous improvement must be our mantra.
Development Strategy
Although these goals are simple to state, they require a great deal of work to translate them into a finished product. The next step in this process is to formulate a development strategy that extends from the goals. The key elements of that strategy are listed in Table 2 and extend the work started in 2005 by Cadotte (2005). In essence, Table 2 defines the guiding principles or strategic thrusts that have channeled the energies of the design team for more than a decade. These strategic thrusts are discussed in this section with references as to how they have been operationalized.
Development Strategy.
Content and Technical Specialists
At the heart of any simulation is the algorithm that drives how the market and business work. Everything must behave in a manner that is consistent with business theory and practice. It should be possible for students to discern cause and effect as they gain experience in the exercise, from which they can adjust their knowledge base and apply what they believe to be true in the next round of decision making. In this way, they incrementally advance their knowledge of the world, how it works, and how to use this knowledge to profit their business. Essentially, a simulation provides an extended environment for the theory of experiential learning to take hold (Cadotte, 2014b; Kolb & Kolb, 2005).
Clearly, disciplinary experts (scholars and practitioners) are the key to the development process as they provide guidance on the exercise’s content. Each is asked: “If students could master just a handful of critical issues within the professional’s discipline, what should they learn? What, in essence, does every manager need to know from your discipline?”
The resulting set of concepts, viewpoints, principles, tools, and ways of thinking are then carefully designed into the simulation. The algorithm is then tested and retested among developers, students, and faculty to ensure that everything behaves as it should. This process can take years. The driving force in this work is our ultimate goal to help students master the content and develop the competence and confidence that they will need to be effective, responsive, and competitive in their ensuing careers.
The managerial and theoretical underpinnings of the algorithm can be found in Cadotte and Bruce (2003). Recent examples of this development process include our work on the Conscious Capitalism, the Xtreme Supply Chain Management, and carbon fiber bike simulations. Working with the Conscious Capitalism Institute, we spent 3 years attending its conferences, speaking with its founders, and interviewing the leaders of firms that have been singled out as “best of class.” For Xtreme Supply Chain Management, we worked with the supply chain faculty from the University of Maryland, executives at the Council of Supply Chain Professionals (CSCMP), and reviewed numerous articles and textbooks on risk management in supply chains.
To help us with the design of the new carbon fiber bicycle scenario, we have immersed ourselves in the biking industry through international market reports, visits to bike stores in multiple countries, in-depth interviews with store operators and bike advocacy groups, as well as participation in bike competitions, off-road treks, recreational biking, and commuter biking. We also delved into advanced manufacturing using carbon fiber and 3D printing at the Joint Institute for Advanced Materials, the National Composite Manufacturing Institute, and Oak Ridge National Laboratory’s new Carbon Fiber Technology Facility.
To convert all of this content into software code that looks and feels like one is managing a real company on any Internet platform, it is essential to use mathematicians, programmers, graphic designers, 3D modelers, animators, user interface designers, HTML coders, infrastructure managers, and system administrators. Once a simulation is launched, you need talent for marketing and sales, technical support, billing, and accounting, and so on, all on an international scale.
All of this requires that we carefully manage the work using an integrated development environment, version control system, bug tracking system, and task managing software. We use an automated build system for releasing new versions and have dedicated development, test, and production environments. To ensure the quality of the code, we have in-house and outside testers and three development stages of alpha, beta, and production. Gone are the days when one or two people could design, code, and market a simulation of any complexity.
Learning Strategy
Our experience over the past three decades has given us much to draw on when formulating a learning strategy. We have learned what we can expect from faculty and students, what they can and will do, and where they have problems or challenges. We have observed a lot of variance in both the depth and breadth of learning. Consistently achieving high levels of learning requires careful scripting from start to finish.
Our goal has been to better organize the learning approach so that the simulation experience is more believable, intuitive, interesting, and relevant. We also want to take more control of the learning process in order to increase the impact on the students and lessen the burden for the instructor. Table 3 contains a list of the key features of the learning strategy, along with the benefits we seek for the student and instructor. We summarize our learning strategy here.
Key Features and Benefits of the Learning Strategy.
The new venture scenario is key to the learning approach. It allows us to start at the beginning of the story versus in the middle as with a mature firm, which is the norm in other simulations. Students see how various concepts, principles, tools, and ways of thinking become useful as the firm expands its operations and must take on new tasks and responsibilities. In this way, the logic of our business practices becomes more intuitive.
The narrative storyline is also integral to the learning approach. It is designed to read like a business novel with student teams acting as the characters. The flow of the story is carefully choreographed, 2 but the story is played out by the participants who can take it in any number of directions—a kind of a “choose your own adventure.”
The step-by-step menu and narrative guide the students through the decision-making process. We carefully control what is presented to the students to make sure that they are thinking about the right things in the right order. The storyline introduces everything within its proper context, making it more believable and intuitive.
For example, the students are always given relevant information (e.g., market data, operational statistics, and/or profit analysis) before they make any decision. They are also provided with issues, conflicts, constraints, and tradeoffs to consider at every juncture in the exercise. The goal is to make it easier to think and work through a complex business program and develop a thought process that students can carry into the real world.
Starting in 2005, we began to explore methods to visually enrich the interface. The opportunities and results over the past decade have caused us to make it a hallmark of our simulations. Students can now see a visual representation of the products, ads, and websites they design, as well as how changes in various manufacturing options affect their production line. They can see inside the sales outlets they build and the factory they manage. Enhanced visualization in decision screens and reports makes the decision-making process and data analysis more intuitive.
We have continuously tried to make the interface intuitive, almost seamless. We have reduced our use of technical manuals and how-to-use videos. Rather, we dynamically overlay hints and suggestions when needed, combined with intelligent warnings and error checks. The goal is to make the interface completely self-sufficient so that no outside material is needed in order to learn how to use it.
To add more realism, continuity, engagement, and fun, we have pioneered animated videos, badges, blogs, and social media outlets. To deal with particularly difficult learning points, we have added graphically rich microsimulations that provide tightly focused and entertaining training.
We consider this learning strategy to be a major breakthrough in simulation pedagogy. First, we continually reinforce the mental discipline to (1) use information to make decisions, (2) consider the links between this decision area and all others, and (3) make sure that it all fits within the larger strategy of the firm. Second, we increase the odds that learning will occur because relevant guidance and instruction is provided at a point in time when students are most receptive to learning (i.e., when they are facing a problem that must be resolved in order to successfully proceed). Third, we make the story interesting and visually rich so that students can get caught up in the drama and not even realize they are learning about marketing and business. Finally, we make it easier for instructors to do their jobs. We provide much of the guidance within the simulation. As a result, instructors must deal with fewer questions and provide less handholding.
Focus on Strategic Planning
The process of strategic planning is emphasized throughout the exercise. Because the competitive landscape is constantly changing, the firm is constantly evolving, and new conditions are choreographed into the storyline, every decision round is different. Each period (3 months in game play) requires a reassessment of the situation, an evaluation of options, a reformulation of the strategy, and the deployment of revised tactics.
The exercise provides for more than “on-the-run” strategic planning. We promote the Objective–Strategy–Tactic mental discipline from start to finish. Students can understand this framework conceptually but have great difficulty putting it into practice. To help develop this critical skill, we have added strategic and tactical planning templates to guide the student’s thought process. We have also created mind mapping capabilities to help students visualize the natural flow from objectives to strategy to tactics to results to reflection and skillful adjustment. We are trying to help them discover the dots and connect them.
After the first year of business (four decision rounds), the students also pause in the play of the game in order to develop a formal, four-quarter (1 year), marketing or business plan. They are asked to reassess the market, rethink their strategy, and then develop a detailed plan to map out all of their decisions and financial requirements for the next four quarters of play. At the end of the exercise, they must report on their company’s performance, any departures from the plan, justification for the deviations, and a plan for the future.
Tactical Detail
The simulations are differentiated from many other simulations because of their focus on tactical decision making as part of an overall business and marketing strategy. Many business and marketing simulations deal with the strategic allocation of resources (how much to invest in new product development, overall pricing, distribution channels, manufacturing capacity, etc.) and not the smaller scale aspects that would need to be executed in order to follow up on these resource decisions (see Batko, 2015).
One of the reasons for the focus on tactical detail is that 99% of the work is in the execution of a plan. To paraphrase Thomas Edison, strategy is 1% inspiration and 99% perspiration. The strategy is the inspiration. The tactical execution is the perspiration. As Admiral Rickover was fond of saying, “The Devil is in the details.”
A second reason for this emphasis is the desire to take participants to the lowest level of strategic planning so that they can build a strategy from the bottom up as well as from the top down. This kind of knowledge will help students formulate strategy in the future. They must know their tactical options and the requirements for implementation. These represent the building blocks of future strategies.
Third, the deployment of tactics is in a constant state of flux. While goals often remain fixed and the strategy fairly stable, skillful adjustment of tactics is the rule in execution. New problems, threats, constraints, and even opportunities continually present themselves. The dynamic environment in which strategies are executed once again requires that business people fully understand their tactical options.
Finally, tactical decision making is more representative of the business environment students will face on graduation. Let us illustrate.
The simulation is set within the personal computer industry. Among other things, customers buy ease of use, the ability to work while traveling, and the ability to work on tiny details in engineering design. These benefits allow customers to be more productive, advance in their companies, and thus earn more money and achieve greater security in life.
While customers buy benefits to achieve end states, the firms within the simulation produce components such as data storage devices, central processors, keyboards, Internet connectivity, monitors, and so on. The challenge is to select the correct components so that the final product will deliver the desired benefits. For example, to deliver the benefit of being able to use a computer on the road, the students would have to realize the collective value of (1) a thin display to reduce the computer’s size and weight, (2) a rugged design so that the computer can be carried around and handle bumps and falls, and (3) an Internet connection in order to send and receive information to and from customers and the office.
This level of tactical detail is a hallmark of the simulation. Whether it be product design, ad copy design, media planning, search engine marketing, sales force management, production scheduling, or cash budgeting, the goal is to make the decisions representative of the kind that the participants will face early in their business careers. This makes the transferability (relevance) of the learning much higher.
Balanced Scorecard
Students deal with strategy and tactics, but they must take a balanced perspective in the execution of each. A Balanced Scorecard (Kaplan & Norton, 1996) is their primary mechanism for checking performance in relation to their goals. It is a quantitative measure of the student team’s ability to effectively manage the resources of the firm and considers both the historical performance of the firm as well as how well the firm is positioned to compete in the future.
The most important component in the scorecard is the team’s financial performance, and thus its ability to create wealth for the investors. However, the focus on current profits has caused many executives to stress the short-term at the expense of the future.
The long-term viability of the firm requires that the team be good at managing not only the firm’s profitability but also its marketing activities, human resources, supply chain, cash, and financial resources. The management team must also invest in the future. These expenses might depress the current financial performance but are vital to creating new products, markets, and supply capabilities.
In our experience, the best managers are naturally good at managing all aspects of the firm in a balanced way. However, most people tend to focus on a smaller set of objectives and optimize around them. The value of the Balanced Scorecard is that it conditions everyone to develop a discipline of balance and to think and manage in a multidimensional way.
From an instructor point of view, the Balanced Scorecard makes it easier to grade. It provides one performance number for each team that is highly related to the quality of the thinking and decision making. It is also a very effective diagnostic tool allowing one to easily spot a team’s strengths and weaknesses. As such, it facilitates the instructor’s role as a coach and mentor.
The Mental Discipline of the Simulation
One of our learning goals is to develop and reinforce a good mental discipline for decision making. At the foundation of this mental discipline is the belief that decision making is a process that is based on information, an integrated perspective of the firm, and a plan that links actions to outcomes. Students continually test their knowledge, learn from their experiences, and skillfully adjust strategy and tactics.
By example and through many repetitions, we try to help students think through decisions to their logical conclusion. We make sure that outcomes are always linked to decisions so that they can discover causal relationships. We make it clear that each decision is not an isolated event but can have cascading positive and negative ramifications on other aspects of the business.
We have gone to great pains to make sure that the students see the big picture as well as the tactical details. They must frequently revisit their overall strategy and evaluate its performance relative to their goals, current market conditions, and available capabilities. We provide tactical planning charts that make it easy for students to literally see all of their major decisions at a single point in time and over all of the decision periods. We make it easy to plot tactical decisions into the future and project the pro forma financial outcome of these actions. We want students to have a clear understanding of the financial implications of their business decisions by linking them to cash flows and bottom line performance. At every opportunity, we push them to consider how one decision affects others and to consider how the entire set of decisions must be coordinated to achieve the desired outcomes.
In the classroom, we further reinforce this mental discipline by changing the instructor’s role from that of a teacher to that of a Coach. The enhanced simulation allows students to absorb a lot of the lecture material on their own and at their own pace, and with meaningful interaction—freeing up some of the lecture time for personalized coaching. In this flipped classroom setup, students can meet regularly with the Coach in Executive Briefings to provide updates on plans, analyses, strategy, tactics, finances, and the justification for everything. If the Coach is able, we encourage that the students prepare, present, and defend a marketing or business plan and a final report. We have developed rubrics for executive briefings, business plans, and final reports that inculcate this mental discipline. For further details, see Cadotte (2014b).
Make Learning More Fun
Competitive marketing and business simulations are already fun, compelling experiences, but they can be improved. To that end, we have incorporated animated stories, badges, blogs, and social media connections. All of these are derived from the premise that the more senses that we employ, the more opportunity there is for learning to occur. It is in this area that our current work goes substantially beyond our thinking in 2005 (Cadotte, 2005).
Animation
We have learned much from studying video games and how engaging they can be. Video games offer realistic storylines, graphics, and action. In contrast, business simulations tend to rely on text, numbers, and simple graphs. Students are left to imagine the real world, but most students have no real business experience to draw on. It is this imagination gap that we are trying to fill with our enhanced visualization efforts.
We are working to blend textbooks, lectures, movies, and video games in order to create a kind of business adventure. To that end, we have created an interactive business story to tie the entire experience together. It presents realistic, animated characters in various business situations. While the simulation results are still presented in a traditional form, they are also played out through lifelike situations. Students experience the specific consequences of their actions in a visual environment of which they are a part. For example, if their firm struggles with poor customer satisfaction, they will experience the reaction of an unhappy customer “face to face.” If one of their executive decisions causes havoc in the factory, they will have a very irritated plant manager on the phone to let them know. If their failure to react to a competitor’s pricing hurts their demand, the sales manager will be quick to point out the issue. Such realistic experiences resonate with students on a more personal level, which greatly increases knowledge retention.
After a few years of classroom experience, we have learned that the animations tend to (1) appeal to a different learning style—visual versus symbolic; (2) help naive students understand the decisions they face; (3) bridge the gap between difficult concepts and practice; (4) emulate what is going on in the rest of the students’ lives (they are comfortable with it); and (5) are more fun. But these conclusions are not universal. There is a large segment of students that are just as happy to have the traditional text, tables, and charts. Because of this, you must provide the option to turn the visual content off.
To see an example of the animated storyline, click on the video on the right at the following website: http://www.marketplace-simulation.com/simulations.
Badges and Social Media
The millennial generation is accustomed to getting accolades for their accomplishments. Educators have found that the gamification of the classroom experience by offering tokens for good work can motivate students to higher levels of performance (Reiners & Wood, 2015). Along these lines, we have added a comprehensive set of badges that are automatically awarded to students when they achieve critical milestones such as taking an executive position in a new (simulated) company, earning their first profit, having the best brand or ad on the market, having the largest market share, managing the most efficient factory, and so on. In addition to taking personal pride in their accomplishments, students can easily post them to a variety of social media, including Facebook, twitter, or the blog setup within the simulation software.
Easy to Use With Web-Based Delivery
Another of our design goals is to create an interface that is easy to use with an intuitive look and feel. The visual impression is just as important as the substance.
The web represents the best option for large-scale delivery to an unlimited number of students and instructors. Fortunately, the development tools available for the web are very good. Here is a list of the key features that we have been able to design into the simulation for the benefit of the student.
Easy access. The entire simulation is housed on Internet-accessible web servers. Consequently, students are able to work from school, home, or work at any time. They can even work concurrently.
Virtual teams. The web setup greatly facilitates teamwork. As each student completes his or her work, the decisions are saved to the Internet server. The next student can pick up from the last one and continue the work. There is a log that shows what work was done, when it was done and who did it. Chat, e-mail, and a teamwork monitor are built directly into the student software in order to make online collaboration easy.
Everything is organized. Everything is organized according to the storyline and the tasks that are to be completed. Everything is point and click. The step-by-step directions guide the users through the tasks they need to complete within each decision period. There are also help files in which the managerial background to any decision or piece of information is presented. We also provide Quick Links to give students instant access to any information that might be helpful in assessing a situation or making decisions.
Compatible across digital platforms. As a result of recent updates, the decision screens, storyline videos, and the instructional content will now scale on a wide range of screen sizes from desktop to mobile, including a variety of touch devices.
In short, we have tried to place everything the students need to know at their fingertips on the digital platform of their choosing. The goal is to reduce the barriers to learning, whether they be content, logical process, or technology.
Instructor Ease of Use
One of our most important goals is to make it easier and easier for the instructors to do their job—helping students learn. It is wasted effort if the instructor must spend time on the mechanics of managing a simulation. The following is a list of the key features for the instructor, most of which have been enhanced since the 2005 article. To review the instructor software itself, go to http://www.marketplace-simulation.com/instructor-site-video-tutorial.
Easy setup. With the web, there is no downloading or installations. A processing center has been set up to create the simulation game according to instructor’s specifications. The instructor can specify which level of difficulty he/she wants to use, the schedule for completing each quarter’s decisions, the number of teams and the number of students.
No administration work. After the instructor specifies the schedule for the simulation, the administrative details are handled by the processing center. Students are automatically reminded when decisions are due. The decisions are processed according to the schedule, the data on the web server is updated, and the students and instructor are notified when they can view the latest results. The instructor does not have to touch anything.
Error checking and quality control. We constantly worry about the “happiness factor.” If a team makes an unfortunate key entry error or a serious blunder in their decision making, they could lose their interest in the exercise, and thus their motivation to learn. Therefore, a validity check is made before the students are able to submit their decisions for processing in order to determine if all decisions have been made correctly. Students receive fatal errors if something critical has been overlooked or if they have made decisions that are considered fatal to their future. They also receive various warnings to reconsider certain decisions if they could cause problems but are allowed if the team has thought through the potential impact carefully.
Finally, the processing center performs a final check on the results to make sure that everything is within the normal bounds. If there are unusual results, the instructor is informed and consulted regarding the disposition of the problem. The goal is to keep the students out of trouble and motivated, and thereby, increase the “happiness” of the instructor.
Easy to monitor student work and results. The instructor has instant access to all student work. He or she can view the activity and decisions of every team at any time, even before they are finalized. It is also possible to trace every student’s activity within each decision period and for the exercise as a whole. This allows the instructor to ascertain how well prepared the students are in making decisions and in coaching meetings.
Once the decisions have been processed and the results are available, a variety of reports and graphs are prepared for the instructor to quickly see how the teams performed. At a glance, the instructor can view market demand, revenue, and profitability. He or she can drill down into measures of customer satisfaction, demand fulfillment, channel profitability, and so on. Everything is at his or her fingertips.
Quick processing. As soon as students have submitted their decisions, they want to know the results, as does the instructor. To provide nearly instantaneous results, we have had to evolve our processing infrastructure and system. Everything is now managed by dispatcher software that assigns a game to any available computer in a processing pool. Not only is there quicker processing, but there is less chance of downtime due to computer failure. This also allows easier scaling as student volume increases.
Diagnostic coaching system. An instructor needs to be able to do his/her job all of the time. A built-in, real-time coaching assistant automatically identifies critical coaching points for each team at any point in the exercise and provides an instructor with information (customized for each team) that can be used directly to coach students in the classroom.
The coaching assistant examines both the current quarter decisions and the previous quarters’ results. Coaching points are listed by severity with a short statement describing the problem. By clicking on any performance issue, the instructor can drill down to obtain a detailed description of probable reasons for the problem, along with data extracted directly from the team’s decisions and results.
We also use the Balanced Scorecard as a coaching source. A color-coding scheme highlights degrees of performance, from best to worst among the current class. By clicking on any performance indicator, the instructor and students can also drill down into the performance criteria that make up each indicator. The goal is to help both instructors and students diagnose the potential causes of a problem. Students especially need to understand how their decisions affect each metric, and ultimately their performance in the game.
Finally, we have developed an automated grading system that computes a grade for each team and student at the end of the exercise. The grade reflects how well the team has performed on the cumulative balanced scorecard relative to the performance of the other teams in that game or universe, as well as against all teams that have ever played that simulation. There are three options for the grading curve: easy, intermediate, and difficult. Instructors can preview the grades associated with each option before selecting the final setting. Grading is rigorous, quick, fair, consistent, and helpful with large classes.
One Size Does Not Fit All
Throughout the time that we have been developing and refining business simulations, realism has always been a top goal. We reasoned that the more realistic the exercise, the better the learning experience. We thought that more is always better.
What we failed to realize was that more realism also translates into more complexity. As we add complexity, we increasingly make it more difficult for participants to learn, a fact that hit home when we began to develop a simulation for an introduction to marketing course. Added realism in this case caused dissatisfaction.
We realize now that “ease of use” is an important goal for student groups that have less business experience. In much the same way that Windows, Netscape, and, more recently, smartphones made the Internet available to everyone, the easier we make it to learn, the happier students and faculty become. Ease of use must be a primary goal for introductory courses and realism is the goal for advanced courses.
The tradeoff between ease of use and realism plays out in a number of ways in the simulations that have and are being designed. It has required us to create a family of simulations.
This family is designed to give the instructor a choice in selecting a simulation that best fits the learning objectives of the course. The complete set of simulations and the courses to which they are targeted can be found at http://www.marketplace-simulation.com/simulations.
There are three factors that determine the level of difficulty of these simulations: disciplinary emphasis, number of decisions, and complexity of decisions. See Table 4.
Relative Emphasis of Marketing Content in a Simulation.
Disciplinary Emphasis
The simulations vary relative to the emphasis placed on the different disciplines within the simulation. For example, the Introduction to Marketing, Strategic Marketing, and Advanced Strategic Marketing simulations focus almost exclusively on marketing issues.
Another simulation that should be considered by marketing educators is Business Management. While marketing dominates the decision making within this simulation, marketing decisions are placed within the context of a whole firm. Students must deal with interdependent issues in manufacturing, finance, and accounting.
In the case of Strategic Corporate Management, marketing has an equal footing with the other functional areas. Marketing is totally integrated into the fabric of the firm and the teams must deal with the many tradeoffs and conflicts between marketing, manufacturing, distribution, human resources, finance, and accounting.
Over time, we have seen marketing and business evolve and expand their disciplinary focus. For example, the rapid growth of Internet marketing caused us to add search engine marketing to the Advanced Strategic Marketing simulation for carbon fiber bicycles. We also created the Conscious Capitalism simulation in response to a sea change in management education focusing on being more socially responsible. The Xtreme Supply Chain Management simulation took into consideration the increasing risks in global distribution. Other simulations have modules that deal with outsourcing, human resources, and international economics. It is simply not possible to have one simulation that is suitable for all learning requirements.
Number of Decisions
The simulations also vary in terms of the number of decisions that must be made. Simulations have been built that either highlight the fundamentals of the discipline (i.e., Introduction to Marketing) or provide in-depth treatment of the decisions that are typically faced by professionals in that discipline (i.e., advanced strategic marketing).
Complexity of Decisions
With certain courses, the objective is to touch on the fundamentals of marketing in order to illustrate the nature of marketing. The desire is to have a short, fun exercise that clearly illustrates marketing thought. In other cases, the instructor may want considerable depth and sophisticated decision-making to prepare a student for a career in that disciplinary area. The complexity of a simulation can be varied by adjusting (1) the scope of the game scenario, (2) the amount of information presented, (3) the number and variety of decisions in any tactical area, and (4) the number of options to choose from for any decision.
Scope of game scenario. In terms of the scope of the game scenario, the number of sales territories and segments that must be targeted can be adjusted. By adding in more markets and segments as we move from Introduction to Marketing to Advanced Strategic Marketing, the strategic and tactical options can be expanded, increasing the complexity.
Amount of information. In all of the simulations, the students must deal with designing brands, creating advertising campaigns, setting prices, and so on. These decisions are largely based on the market research that is presented regarding the needs and wants of the customers. In the Introduction to Marketing simulation, the list is limited to the most important needs and wants while the list is very extensive in the case of the more advanced simulations.
Number of options within a decision. To add or reduce complexity, the number of options that are available within any decision area is also adjusted. For example, a student in the Introduction to Marketing simulation will have 24 feature options to choose from in designing personal computers for 3 market segments. In the Strategic Marketing simulation, the student will have 35 component options for 5 market segments, and in the Advanced Strategic Marketing simulation, the student will have 54 options for 5 segments. Similarly, the number of benefits that can be considered in an advertisement increases from 29 to 47 to 57, respectively, and sales outlets will increase from 4 to 12 to 20, respectively.
Conclusion
No single learning approach can fulfill all of the needs of our students. Innovative technological tools can refine and advance management education, giving us greater freedom to help students visualize, experience, comprehend, and retain what we want them to learn. There is almost nothing we cannot simulate or present in sufficiently realistic detail.
The reason that this is so important is that simulations are exceptionally good at transformational learning resulting from incremental knowledge acquisition. This process is widely recognized by simulation scholars, although it is articulated in many different ways. Tying it all together is Kolb and Kolb’s (2005) theory of experiential learning, a theory that is eminently testable within the domain of simulation learning.
The purpose of this article has been to illustrate the process by which business simulations can be systematically designed by using many resources (content specialists, software engineers, and technology) to purposely achieve new levels of experiential learning. The fundamental goal is to maximize the learning potential. To achieve this goal in this instance, an innovative learning strategy has been formulated and is being executed. This strategy is to more carefully control the learning process in order to make it more interesting, intuitive, relevant, and easy, thus improving the odds that important concepts, principles, tools, and ways of thinking become absorbed into the fabric of the participants.
Footnotes
Declaration of Conflicting Interests
The author(s) declared the following potential conflicts of interest with respect to the research, authorship, and/or publication of this article: The author is the author of the Marketplace simulation which is referenced within this article.
Funding
The author(s) received no financial support for the research, authorship, and/or publication of this article.