The Logic of Failure in Business Simulation Games

Or “Why you never reveal the detailed logic of a business simulation game”? Certainly not before or during the game! Why not?

The purpose of a business simulation game for learning is to surface the rules people operate by in the real world to identify a) Knowledge Gaps and b) Logic Traps.

A Knowledge Gap is where someone simply lacks understanding of or exposure to an important area of their business, for example how the impact of pricing impacts demand for different products and markets (price elasticity).

A Logic Trap is where someone is operating using a rule which may be limiting their performance. Usually this is because a rule only applies in a limited set of situations but is being applied as a universal. [See Dietrich Dörner's excellent book “The Logic of Failure” for an extended discussion of “Golden Rules”] To surface the rules people are using (or “implicit mental models” as they are often called) the game needs to act as a mirror which can be used to reveal these rules experientially. If you tell the participants too much detail of the cause-effects built in to the simulation they will inevitably become distracted and start to begin to try to “game the sim” and second guess the rules.

The conversation you want the players to be in is “what would we do in the real world” - not “what do we need to do to win this game”. If I am pushed on explaining the rules I simply say they are based on the understanding of one or more subject matter experts in your business and they are what you would expect them to be. If I am pressed further I will offer to go through the rules with them after the game is over but I am seldom taken up on my offer.

Finally remember the Einstein quote “All models are wrong but some are useful”. Getting into any kind of conversation about whether the rules are “correct” is a total waste of energy and time! Therefore the simulation rules need to be good enough in the first place to avoid this happening.