Business Strategy Game

Beating the Business Strategy Game About the Guide. Help, hints, tips, and strategy for The Business Strategy Game (Thompson & Stappenbeck) which will greatly improve your game performance. When playing the Business Strategy Game , none of the companies have much money in year 11.Companies need to raise funds using either debt or equity. By financing your company via debt, you accept risk of bankruptcy. The Business Strategy Game is a hands-on learning exercise that draws together the information and lessons of prior courses, consolidates your knowledge about the different aspects of running a company, builds your confidence in analyzing the revenue-cost-profit economics of a business, helps you understand how the functional pieces of a business fit together, provides valuable practice in. A business strategy game will develop the decision-making skills of your staff and help ensure the results are aligned. As well as inspiring staff with a sense of purpose, your strategy should be the foundation on which everyone in the organisation bases their decisions.

Will you be able to run your own business someday? Do you have the basic decision making skills of an entrepreneur?
Play our free online business strategy game and learn what it means to be an entrepreneur. As the CEO, take strategic & operational decisions for your virtual business. Learn about SCM, marketing, HR, finance, production planning & more.

What is BizMAP

Business books and theory can’t teach you about business as much as practical, hands-on experience can. If real-world experience is difficult to come by, choose the middle ground – Management Simulation Games.

Strategy

BizMAP is a Management Simulation Game created by Sameer Kamat (Founder of MBA Crystal Ball) to test and develop your Business Management Aptitude & Potential (that explains the acronym!). With zero investment (apart from your time), it puts you in charge of a growing business and tests your aptitude for managing a startup.

There’s no need to download software or customise open-source code. Just launch it and play. International management students are using it in the MBA classroom too.

There are some limitations for the free version (i.e. limited number of quarters). If you want to use this for academic or professional purposes, and would like your students to go the full distance, check the note at the end of the page and send us an email for the premium version.

Testimonial

Nice introduction to the business issues

“My MBA students are required to earn $5m+ operating profit by the end of the BizMAP game to earn 5% of their grade. It helps students gain an appreciation for the connection between elements in the value chain – pricing/advertising (demand), production/employees (supply), and R&D (productivity gains).”

– Dr. Steve Phelan, Distinguished Professor of Entrepreneurship & MBA Director, Fayetteville State University (USA)

Good way for students to learn that strategic management is not a textbook lesson

“The simulation helped the students to understand some of the concepts more vividly as they see them being played out in the game. The only issue was the “restricted” realism arising from the simplified industry dynamics programmed into the game. Overall, it was a good way to expose students that strategic management is not a textbook lesson. ”

– Chong Chee-Leong, Adjunct Associate Professor, Department of Strategy And Policy, National University of Singapore (NUS)

Setup time is minimal. Within the limited scope, there’s complexity.

“I’ve used Capstone and some Harvard simulations. The USP of BizMAP is that the setup time is minimal. It can be used as an introduction to business simulation for students with little or no experience to simulation. Even within the limited scope, there’s complexity in the game as it involves multiple variables (production, marketing, R&D, etc.)”

– Prof. Salman Ali, Business Policy and Strategy Department, Indian Institute of Management (IIM) Raipur

BizMAP Context

BizCool, a fictitious technology startup that provides customized, high-end servers has just received the first round of venture capital funding. The VC investors saw potential in the business, but felt that the founder (a techie at heart, not a businessman) who has done a pretty good job with the basic product, wouldn’t be able to scale it up.

That’s why, on a strong referral, they got you onboard to take on the reins of the business.

Your mandate: As the CEO of the fledgling startup, you have signed an employment contract for 12 Quarters (3 years). [Note: In the free version, this is limited to 4 quarters i.e. 1 year only]

With the limited resources (money, people, time), you’d be expected to take strategic and operational decisions across all the key departments – Supply Chain, Human Resources, Marketing and Corporate Strategy. Your challenge is to not just keep the ship afloat, but also to help it reach new shores.

At the end of the tenure, the paranoid VC team will decide whether you stay hired or get fired!

BizMAP Business Strategy Game Rules



– You are taking over an existing business. That means you already have a team (4 employees), some sales and some cash (a million dollars) in hand.

– When you start the game, analyze the operational and financial numbers before you take any decisions. This is depicted by Steps 1 & 2 in the image above.

– You will need to take 5 decisions each quarter (as shown in Step 3 above). Not doing anything (i.e. entering zero in the input field) in a specific area is also a decision.

    – Decision 1: How many units to produce: Choose a range from 0 (nothing to produce) to the maximum production capacity for the company (defined by the number of employees).

    – Decision 2: How to price it: You can deviate 20% from the estimated industry price. Raising the price has an adverse impact on the market demand. And vice versa.

    – Decision 3: How much to spend on marketing: Without marketing you still have a mimimum demand. However, to scale up, you’ll need to spend on advertising.

    – Decision 4: How many employees to hire/fire: Each new employee increases the quarterly production capacity by 20 units. But the salary costs go up as well.

    – Decision 5: How much to invest in product development: Investing in R&D can yield a surprise over time, but only if the cumulative amount exceeds a certain threshold.

– Submitting your decision takes the story forward by 1 quarter.

– The game ends when you complete your contract (12 quarters) or the business becomes bankrupt (cash position goes to zero or negative), whichever is earlier. So keep an eye on the ‘Cash’ position & work towards increasing it.

A little about how the Supply Chain works


– What you produce will not reach the market immediately. While the product moves through the supply chain, there are time delays as follows.

    – Once you place an order for the units, the underlying components have to be procured from the market (In-Transit phase). It takes 1 quarter for your vendors to deliver.
    – After the material reaches your company, your team assembles the end product (work in progress or WIP phase). You lose another quarter for this step.
    – Then the end product is moved to the warehouses / retailers (where it becomes Inventory). Another quarter needed for this.
    – From the warehouse, the products can be shipped to customers immediately. There’s no time delay here.

– If you have enough quantity in your inventory, the relevant number of units are shipped out to the customers. If not, the backlog of orders keeps piling up and needs to be satiated in the subsequent quarters.

– Similarly, decisions related to Hiring, Marketing, R&D investments reflect in the next Quarter.

How to get better at the Business Strategy Game

In any Business Strategy Game, including BizMAP, you will not get it ‘right’ in the first attempt. Play the game multiple times and try to refine your strategies and entrepreneurial skills with each attempt.

Learn a little more about the theoretical concepts behind the game in our Free MBA course.

Don’t shy away from trying various business strategies (conservative & aggressive scenarios). See how each business strategy impacts the end result.

If any of this isn’t entirely clear, don’t worry. Start the game and you’ll soon get the hang of what’s happening.

Alright, enough talk. Let’s get into the action!

The free version is NOT for academic or professional use: If you are a professor, trainer or university / company representative interested in using this game for your class, we can create an account with a customised user-interface specially for your brand for a nominal charge. And your students get to play the full game for 12 quarters (instead of 4). Read more here – BizMAP pricing. If this looks interesting, send us an email: info [at] mbacrystalball [dot] com

You may also be interested in trying our Supply Chain Management Game.

Business war gaming (Corporate war gaming) or business wargaming is an adaptation of the art of simulating moves and counter-moves in a commercial setting. In a complex global and competitive world, formulating a plan without testing it against likely external reactions is the equivalent of walking into a battlefield without the right weapons or a plan to win. In situations where the cost of being wrong is high, war games can be very helpful to understand from a 360-degree perspective the external opportunities and challenges of all the key stakeholders in the industry. [1]

Unlike military war games, or fantasy war games which can be set hundreds of years in the past, business war games are usually set in the present and are a relatively recent development, but they are growing rapidly.[2]

The rationale for running a business war game is that it is a tool of particular value when the competitive environment is undergoing a process of change, as it allows decision makers to consider proactively how different players can react to the change, and to each other. The benefit of teams role playing competitors and developing more robust strategies is especially notable, and can be inferred from a quote such as the one below from Richard Clark, CEO of Merck and Co., who in an interview to USA Today said: 'I am a strong believer in if you’re going to develop a vision or a strategic plan for the future of a company that you have to engage the organization in doing that…it can’t be just the CEO or top 10 executives sitting in a sterile conference room.'[3]'.

At the Paul Merage School Of Business at University of California, Irvine the final exam for the competitive intelligence class is a war game in which the students role play various companies to try to win in the marketplace. Each year student teams have developed strategies - some of which have actually happened in the market place indicating that a war game is a very powerful predictive tool for business when planned properly.

Methodologies[edit]

Market level[edit]

Currently there are three schools of thought about business war game, depending on the underlying philosophy of their creators: 'Business is War' war games, 'Business is a Game' war games, and 'Business is Business' war games. The three types have accordingly, different strengths and weaknesses, and are useful for different applications throughout business.

'Business is War'[edit]

Sometimes abbreviated as 'BIW' war games, 'Business is War' games are a direct adaptation from the military war games, and envision competitors as the 'enemy' and the goal as 'victory' in a market 'battle'. These games are based on mathematical modeling of contestable markets, including chaos theory, random variable generation (Monte Carlo simulations), and econometric modeling of demand and supply conditions. Participants’ generated moves are fed into computer program which generates optimal solutions in the mathematical space. Not surprisingly these games come with a high price tag, and are advocated by large consulting firms which tend to work with the US military establishment.

'Business is a Game'[edit]

'BIG' war games regard business transactions as a game between participants with potentially conflicting goals. BIG advocates apply game theory, a branch of mathematics to business situations with the goal of finding an equilibrium, or 'stable' solution (so called Nash equilibrium) whereby no one can further improve on the outcome. The solution can be computed over a large space of all possible (hypothetical) moves of the players. A leading proponent of this type of war games is Niall Fraser, a game theorist and the founder of a consultancy called Open Options.[4] A variant on BIG is computer simulations’ games using simultaneous equations to solve for demand and supply equilibrium (not a game theory solution). Participants input numerical values for decisions on a wide range of business investments (in production, sales force, advertising, etc.), and receive a computer output of the equilibrium results. Another variant on BIG involves large numbers of simulations to explore the interaction of multiple competitors' strategies, without assuming an equilibrium or a mathematical solution exists. This approach, focusing on active competitors, recognizes that the number of possible actions and reactions is prohibitively large, while also recognizing that simulation can better explore and test decisions than the unaided human mind. Mark Chussil of Advanced Competitive Strategies uses this technology in simulators such as a pricing tournament.[5][6]

'Business is Business'[edit]

Also referred to as 'BIB' regard business as neither a war nor a game.[7] The goals and tactics of war are incompatible with business goals; competitors do not aim to defeat each other but to satisfy customers’ preferences better than others. Government precludes total victories and cooperation is as prevalent as competition. Similarly, BIB criticizes 'Business is Game' thinking on the ground that hypothetical or generic moves are irrelevant or trivial, stable solutions are not a substitute for specific, real life practical and innovative strategies for management, and computer/mathematical simulations do not approach the complexity of competitive dynamics in real markets. Instead, BIB advocates using state-of-the-art competitor analysis techniques and real life competitive intelligence to generate an in-depth profiling of competitors through role playing. The goal of BIB is predicting most likely moves by most significant competitors or other third parties (customers, regulators) so that strategy can be pressure–tested in the most realistic setting. The creator of BIB games is Benjamin Gilad.[8] A variation combines BIB war gaming with computer simulations. This approach, used by Mark Chussil, founder of Advanced Competitive Strategies, uses simulations to estimate the likely outcomes from moves made by a business, its competitors, and other relevant actors, across multiple scenarios.[9] This approach allows for both competitive dynamics and quantitative analysis, at the cost of additional time to set up the war game. Yet another BIB variation involves large numbers of what-if simulations, in which the war game is designed by humans and conducted in a computer.[10]

Business strategy game tutor

Negotiation level[edit]

In contrast to the often larger “Business is War”, “Business is a Game” and “Business is Business” war games, which all primarily deal with market level issues, Negotiation War Games are smaller in scope and only deal with business related negotiations. Even though the US military have long referred to the practice of ”War Gaming a negotiation”, the term ”Negotiation War Game” was first coined by Soren Malmborg in 2010.

Negotiation War Games (aka. NWG)[edit]

A 'NWG' is a Business War Game conducted at negotiation level. I.e. A structured framework for conducting a preparatory Negotiation Simulation[11] on a specific, upcoming negotiation.[12][13]

A Negotiation War Game is most often divided into three steps:1/ Gather Intelligence2/ Simulate Upcoming Negotiation3/ Debrief and calibrate negotiation strategy.

By adding Competitive Intelligence to the simulation, Negotiation War Gaming differentiates itself from normal mock negotiations and other training exercises. The act of gathering and including Competitive Intelligence on the forthcoming negotiation and its parties, lets participants in the Negotiation War Game gain an in-depth understanding of the negotiation itself and the negotiation parties.[14]

The purpose of doing a Negotiation War Game is threefold; 1/ Predicting your opponents' next move 2/ Revealing opportunities, threats and issues 3/ Developing and testing a calibrated negotiation strategy.[15][16]

Role-Play[edit]

Year

Even though software applications can play an important role in the facilitation of a Role-Play Negotiation War Game, the method is inherently focused on role-play simulation. War Games can be used to prepare for virtually all two or three party negotiations. By gathering Competitive Intelligence on the actual negotiation (as well as the individuals involved) an accurate simulation can be created. A client’s employees will then become involved in the actual War Game by acting partly as the company itself, partly as the other negotiating party. Through a series of structured simulations, a tailor-made strategy can then be developed and calibrated.

Role-Play Negotiation War Games are especially effective when preparing for Sales- and Procurement negotiations.[17] Through more than 30 years of business usage and scientific research, the method has been shown to generate significantly better negotiation outcomes compared to other popular methods. (Please see Application section below for references). In 2010, 64,7% of young US Sales-Managers Role-Played their upcoming negotiations, making 'Pure Role-Play' Negotiation War Gaming one of the most used negotiation preparation techniques in North America.[18] A leading proponent and provider of these types of War Games is Outcome Simulations ApS[19] led by Soren Malmborg.[20] As of 2013, Outcome's Negotiation War Gaming method is taught in MBA courses on negotiation at Columbia Business School and NYU Stern School of Business.[21][22]

Applications[edit]

Business Strategy Game Win

BIW[edit]

Given the high budget requirements and long preparations time, BIW games are more appropriate for big companies' big decisions and large budgets, such as corporate games, involving top executives with considerable staff and consultant support. Corporate games are played over major portfolio decisions such as diversification and/or divestiture moves of the parent company (i.e., which acquisitions to go for, which business to get rid of), and over longer term horizons. Myvegas rewards september 2020. BIW games are less appropriate for business units, or business strategy decisions, as their high price tag and extensive time required from top executives are no match for small scale games with more tailored application and flexible format.[23] To fully understand the difference between corporate games played over corporate strategy (portfolio management) and business games played over business strategy (competitive strategy), read Michael Porter’s articles.[24]

Business Strategy Game Year 11 Decisions

BIG[edit]

Business Strategy Game Cheats

Game theory and computer simulation games are appropriate for planning and decision support in industries in relatively stable state, known distributions of outcomes, and predictable competitors, as they are best suited for finding equilibrium solutions among a relatively large set of known variables (payoffs and moves). On the other hand, BIG games are handicapped in rapidly changing industries, markets where surprise moves by new players is a possibility, situations requiring innovative and creative approaches, and in decisions calling for specific practical ideas rather than more generic moves (such as raise, stay or lower prices by x%). Decision makers looking at war gaming should also be minded of game theory’s own lack of empirical support, as people seem to irrationally follow behaviors that do not result in their best outcome. (Chussil, of Advanced Competitive Strategies, argues that 'irrational' behaviors can come from the complexity of competitive-strategy problems; it can be extremely difficult to identify behaviors that produce 'best' outcomes.[25][26])

BIB[edit]

Business war games employing role-playing and competitor analytical techniques are most beneficial in business strategy at the business unit, market, brands, product and project levels. BIB games have been applied with great success to new product launches, offensive and defensive moves against specific competitors (whose response is analyzed using the advanced competitor analysis techniques), in organizational development’s (training the next generation executive cadre) 'competitive landscape' games, and in brand revival and new market entry situations. According to participants, BIB games provide touch reality-based challenge to strategies and plans that helps companies cope with uncertainty.[27] They are less useful in conglomerate strategy as they apply to business strategy and not across unrelated industries. BIB are also more culture sensitive, and should be applied with caution in cultures where honest discussion of blindspots is less than appreciated.[28] The methodological superiority of BIB games over other techniques received strong empirical support from a meta study on the effectivenes of predictions of competitive outcomes using 'role playing'.[29]

NWG (Pure Role-Play)[edit]

'Pure Role-Play' Negotiation War Games have shown to generate significantly better predictions of negotiation outcomes compared to other popular methods.[30] 'Pure Role-Play' Negotiation War Games have also been shown to ensure significantly lower prices in procurement negotiations,[31] and greater writedowns in auditor vs. client negotiations concerning obsolete inventory.[32] 'Pure Role-Play' War Games have been used extensively in business negotiations.[33] 'Pure Role-Play' War Games are furthermore often used in politics. Negotiation War Gaming was used to prepare President Ronald Reagan for his negotiations with Gorbachev in Reykevik and Geneva in 1985 and 1986.[34] Presidential candidate John Kerry used a Negotiation War Game to prepare for his first TV-duel with George W. Bush in 2002.[35] Both President Barack Obama and Mitt Romney used the method prior to the 2012 presidential TV-duels. The NTC (National Training Center, Fort Irwin. Ca.) recommend that all U.S. and Canadian Army officers be trained in the method before deployment.[36]

Board Games[edit]

Board games can be used for business war games. In this case, they are war games for civilians applied with a marketing warfare analogy to a market situation.[37] In this case, these authors talk about creative competitive intelligence.

The war metaphor[edit]

To some, the war metaphor implicit in 'business war game' is an accurate or useful depiction of business and competitive strategy.[38][39] Others find the war metaphor potentially counterproductive.[40][41][42] Some companies play up the war metaphor simply to encourage out-of-the-box thinking[43] while others downplay it with terms such as 'strategy game.'

Business Strategy Game Quiz 1

References[edit]

  1. ^'Singh, Arjan (July 2019): Using war games to predict competitors moves', Life Science Leader
  2. ^'Shall We Play a Game?'The Economist, June 2, 2007, p. 72)
  3. ^USA Today, 'Merck CEO sets sight on change', February 27, 2006, p. B1
  4. ^Fraser, N.M. and K.W. Hipel (1984). Conflict Analysis: Models and Resolutions. New York: North-Holland
  5. ^Chussil, Mark (June 8, 2015). 'A Tournament Pits Strategists Against Each Other to See What Works'. HBR.org.
  6. ^Chussil, Mark. 'The Top Pricer Tournament'. Advanced Competitive Strategies. Retrieved June 1, 2020.
  7. ^Gilad, Ben. 'Neither a War Nor a Game', CI Magazine, 9(6), Nov.-Dec. 2006
  8. ^Gilad, Ben (2008). Business War Games. NJ: Career Press
  9. ^Chussil, Mark. 'ACS Business War Gaming Bibliography'(PDF).
  10. ^Chussil, Mark (June 8, 2015). 'A Tournament Pits Strategists Against Each Other to See What Works'. Harvard Business Review.
  11. ^Shell, G. Richard (2006). 'Bargaining for Advantage'. Penguin Books
  12. ^Kramer, Henry S. (2001). “Game, set, match: winning the negotiations game”. ALM Publishing/ALM Inc.
  13. ^Diamond, Stuart (2010). ” Getting More: How to Negotiate to Achieve Your Goals in the Real World”. Crown Business
  14. ^http://www.mckinseyquarterly.com/Playing_war_games_to_win_2757
  15. ^Ghauri, Pervez N., Jean-Claude Usunier (2003). “International business negotiations”. Pergamon
  16. ^Diamond, Stuart (2010). ” Getting More: How to Negotiate to Achieve Your Goals in the Real World”. Crown Business
  17. ^http://www.holdenadvisors.com/news/1112.html[permanent dead link]
  18. ^'Archived copy'(PDF). Archived from the original(PDF) on 2011-11-17. Retrieved 2012-12-04.CS1 maint: archived copy as title (link)
  19. ^http://www.outcomesimulations.com
  20. ^'Krigsspil kan hjælpe erhvervschefer'. Dagbladet Børsen 26.11.2010
  21. ^http://m.business.dk/?article=25236318-Ivaerksaetter-vil-saelge-%C2%BBkrigsspil%C2%AB-til-amerikanerne
  22. ^http://borsen.dk/nyheder/avisen/artikel/11/46460/artikel.html
  23. ^Woodruff, David. 'War Games Help Businesses Prepare For Anything'. Wall Street Journal (Eastern edition), Newswire: Dow Jones,5/3/02
  24. ^Porter, Michael E. ['From Competitive Advantage to Corporate Strategy'. Harvard Business Review, May–June, 1987 pp. 43-59 and 'What is Strategy', Harvard Business Review, Nov-Dec. 1996, pp. 61-78
  25. ^Chussil, Mark (July 30, 2015). 'Question What You 'Know' About Strategy'. HBR.org.
  26. ^Chussil, Mark (October 24, 2016). 'How the Very Best Strategists Decide'. HBR.org.
  27. ^Woodruff (2002)
  28. ^Gilad (2006)
  29. ^Kesten C. Green, “Game theory, simulated interaction, and unaided judgment for forecasting decisions in conflicts: Further evidence”, International Journal of Forecasting 21 (2005) 463– 472
  30. ^Green, K. C. (2005), “Game theory, simulated interaction, and unaided judgment for forecasting decisions in conflicts,” International Journal of Forecasting, 21, 463-472
  31. ^Bennett, Robert J. (1991),“Simulated Negotiations: A Measure of their Effectiveness on Negotiated Outcome”. Naval Postgraduate School
  32. ^Trotman, Ken T. (2005),“Auditor negotiations: An examination of the efficacy of intervention methods”.The Accounting Review, Vol. 80, No. 1. pp. 349-367
  33. ^Diamond, Stuart (2010). ” Getting More: How to Negotiate to Achieve Your Goals in the Real World”. Crown Business
  34. ^Matlock, J.F. Jr. (2004). Reagan and Gorbachev: How the cold war ended. New York: Random House
  35. ^Wilgoren, J. & Stevenson, R.W. (2004). The 2004 campaign: Strategy; day after debate, campaigns assess the performances. The New York Times, October 2, Later edition – final, Section A, p. 10 column 1
  36. ^http://www.carlisle.army.mil/DIME/documents/PUB792.pdf
  37. ^Goria, S. Information display from board wargame for marketing strategy identification, International Competitive Intelligence Conference: Delivering excellence in Competitive Intelligence thinking and practice in a challenging environment, Bad Nauheim, Germany, 2011
  38. ^Fuller, Mark B. (October 31, 1993). 'Business As War'. Fast Company.
  39. ^Feloni, Richard (February 5, 2015). ''Shark Tank' investor Kevin O'Leary explains why business is war'. Business Insider.
  40. ^Chussil, Mark (November 24, 2016). ''Rally the Troops' and Other Business Metaphors You Can Do Without'. Harvard Business Review.
  41. ^Chussil, Mark (August 18, 2010). 'The War (Game) Metaphor'. Advanced Competitive Strategies.
  42. ^Heffernan, Margaret (January 24, 2011). 'Debunking the Myth that Business is 'War''. CBS Moneywatch.
  43. ^Diamond, David (December 31, 1996). 'Business is War - So Let's Have a War Game'. Fast Company.

Business Strategy Game Tips

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