Thursday, October 23, 2014

The Management Game

Recently, I was invited to play the Management Game, imported from our new corporate owners, Softbank.  What is the Management game?  In 1976, Sony CDI developed a kind of business game called the Management Game. The game simulates running a business, with each participant as a manager. Softbank adopted the game from Sony, and updated it with modern technology.

A group of five to seven people gather to play, each with their own 'factory' and a limited set of resources to drive their factory.  You begin as in most games, by drawing a card.  The card drives your action that turn - make a decision to buy, sell, research, hire or expand, or is a 'risk' card, draining off resources and time.

Originally, the game required all transactions to be manually tracked, forcing the participants to develop a high degree of accounting skills and understanding of the information behind a business.  The Softbank update uses iPads to handle the transactions and accounting, allowing the gamers to focus more on strategy and game theory.  In the 1980s, US executives would pay $500 a head for a multi-day seminar where one single game would be completed, representing a 5 year run for their factory.  Today, we completed all 5 years in about 5 hours, including training and reviewing results.

While difficult to learn in the first round with a compressed schedule, the Management game is a fantastic tool for reviewing the 'big picture' of business, from supply to capacity to the value of research and development.  We all enjoyed getting a chance to lift our eyes from our day to day siloed workflow and take a moment to try to understand all of the parts of running a business.

Strategy is key in the Management game - risks are part of succeeding.  Heavily leveraging your business early in pays off well; you have higher access to capital early in the game, and the interest rates are low, creating little penalty for carrying high debt loads.  Two strategies successfully used in our session were high R&D investment, reducing the cost of your goods on the market, and high sales force investment, allowing you to sell more goods than the other players, due to some oddities in the rules.

The rules don't always reflect real world conditions in markets and business, but they do allow you to see  how game strategy works in running a business.  Win or lose, there are certain rules and values you play by in a business, and maximizing your advantage by the rules will maximize your profit in the business.

A further overview of the game is presented at DigInfo.tv, a Tokyo based news video site:



- Will England, October 2014
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