A business simulation is a dynamic, experiential learning method that replicates real-world business scenarios in a risk-free environment. Participants engage in decision-making processes, strategic planning, and problem-solving within simulated market conditions.
In today’s corporate training landscape, business simulations play a crucial role in fostering practical skills and strategic thinking among employees.
They provide a platform for hands-on learning, allowing individuals to explore complex business concepts and improve decision-making abilities.
Various industries, including Manufacturing, Life Science, Tech, Engineering, Insurance, Banking, and Consulting, utilize business simulations to enhance employee performance and adaptability in an ever-evolving business environment.
All business simulations should mimic real life. They should demonstrate the types of business impacts that result from strategic and tactical decisions. To make it a meaningful learning experience, business simulations must be built with purpose.
Unlike passive learning approaches, such as lectures or presentations, business simulations actively engage participants in decision-making processes within a simulated business environment.
This hands-on approach allows individuals to develop crucial skills such as decision-making, team collaboration, and understanding of market dynamics.
Have you identified a need within your organization that might be addressed with an engaging and memorable business simulation? There are three main advantages to using business simulations to solve for learning gaps.
Participants learn by doing. You can’t absorb others’ knowledge. You must create it on your own. Knowledge obtained through discovery is knowledge that can be applied and stays with the learner.
Participants learn through the simulation and through each other. When you have different roles on teams, each learner is coming at a problem from a different perspective. It allows the learner to debate from a 360-vantage point. A holistic perspective is gained that can be practiced back on the job through problem-solving with different departments, business units, or even with customers.
Toggling from fiction to reality allows for innovative thinking. Learners are not constrained by organizational obstacles during the simulation. Once they play as an executive in the fictional company, they develop ideas for solving problems in their own organization.
The facilitator pauses between each round to address the simulation results and then how it might be applied in the real world. This freedom of constraints makes it easier to visualize true innovation. Ideas are uncovered and can be nurtured when back on the job.
Here are some additional benefits of business simulations over other training methods.
One advantage of business simulations is the emphasis on problem-solving.
Participants are tasked with analyzing data, identifying challenges, and coming up with effective strategies to overcome common business challenges.
This process encourages critical thinking and fosters creativity as participants explore different solutions and their consequences within the simulated environment.
For example, in a sustainability simulation like CELEMI Suststainability™, participants would test out different sustainability initiatives and see how they play out over the course of several simulated years.
Another significant advantage of business simulations is the ability to test strategies in a risk-free environment.
Participants can experiment with different approaches and observe the outcomes without real-world consequences. Mistakes can be made and learned from in the simulation, rather than on the job where the consequences are much greater.
Participants gain valuable insights into the cause-and-effect relationships within businesses, which helps them refine their decision-making skills, while giving them multiple opportunities to test different strategies.
Business simulations facilitate the development of a wide range of skills essential for success in today’s competitive business landscape.
From honing decision-making abilities to fostering effective team collaboration, simulations offer a comprehensive learning experience that prepares participants to navigate complex challenges with confidence.
In essence, business simulations serve as dynamic laboratories where participants can immerse themselves in realistic business scenarios, hone their skills, and emerge better equipped to tackle the complexities of the modern corporate world.
To make certain a business simulation is effective in providing business impact, application tools are utilized during and post class to extend the learning to on-the-job application.
Learning and development professionals should engage the learner post-class with various touch points throughout the year.
Learning and development professionals should support the learner in keeping the learning applied until it becomes a habit.
As in any change management process, old habits can break through as business becomes intense.
Creative ways to encourage change include contests, dashboards that track progress, working with the learners’ leader during one-on-one meetings, and cohort accountability plans.
The excitement of the business simulation can be a launching pad for professionals to reach new heights of performance.
All business simulations should mimic real life. They should simulate the types of business impacts that occur from strategic and tactical decisions. To make it a true learning experience, business simulations are built with purpose.
Competing in a market for a finite number of customers or professional talent is a good way to mimic reality. Teams of learners walk away from the market with either the customers they desire, or whatever customers are left. Now, it’s time to operate within these constraints and compare what the team forecasted with what actually happened. Do they have the right capacity to fulfill customer needs? Did they hire too many professionals to serve too few customers, making overhead an issue? Do they have enough facilities to create the products or services needed to fulfill customer orders? Balancing strategy with operational excellence is not for the faint of heart! When the market does not react how we anticipate or our professionals do not effectively execute strategy, business faces challenges that must be addressed with agility.
Part of the logic of learning within a business simulation is learning by doing. With this comes ambiguity.
Learners find themselves in a setting that feels familiar and unfamiliar at the same time. “I know I’ve been here before and even live it every day, but now I’m in charge of something I may not have the experience or expertise to excel at.”
At first, learners are both intrigued and a bit frustrated by the fog. They must work as a team to discuss, decide, and move forward.
In their real work, the implications of their actions are not as immediate, and thus feel safer.
However, in a simulation, fiscal years are accelerated to hours, and even though they are playing with fake money, profits and losses, cash flow, accounts receivables, accounts payable, loans, interest, and taxes must be dealt with (of course, in some simulations there are different KPI based on the learning objectives).
Once the fog lifts, the excitement is profound.
Many find it difficult to keep seated and are welcome to stand around the board and look to other boards for competitive intelligence.
A healthy competition forms.
Dynamic discussions happen between teams and in plenum. Colleagues learn from the simulation and from each other.
Between each simulated round, the facilitator pauses to connect the dots back to the real organization. Ideas are generated, and change is initiated.
One of the biggest mistakes learning and development professionals make when adopting business simulations is trying to relieve learners of the discomfort of ambiguity.
They want to provide lectures or prework up front to help the learners feel more prepared.
What they don’t understand is that ambiguity is necessary for development. When we learn through trial and error, it makes an impact on our decision-making.
When we study and take a test, the learning stays with us for a short time and then fades away. Skilled facilitators of simulations know how to bring participants along on the journey.
Learners are in a safe environment. They are uncomfortable and passionate at the same time. This setting makes a difference. It is where theory meets execution.
Business simulations are effective in both face-to-face and virtual settings. Facilitators set up the scenario of the game, share the rules, and then allow teams to begin their decision-making.
In a physical classroom, tables are set in pods of 3-5 people and each pod works around a Workmat™.
A projector and screen, along with flipcharts and markers, are needed for shared experiences. A digital Showfile™ is shared between fiscal years or rounds to reveal how teams rank in relation to each other.
Digital gameboards are often used in a physical classroom setting as well. They simply replace the physical Workmat™.
In a virtual classroom, a video conference application such as Microsoft Teams or Zoom is used for discussions in plenum and in break-out rooms.
Each participant has their own laptop with audio and visual enabled. Adequate Wi-Fi is necessary.
Once in the simulation, the learners’ eyes are in their browser on the gameboard, and they use the video conferencing application for audio and to see each other during discussions when desired.
It’s best when there is a seamless transition between gameplay and lecture. This allows for the participants’ energy to be used mainly on learning, rather than wrangling the technology.
The CELEMI Learning Space™ was created with this in mind. It provides a comfortable learning experience while optimizing the functionality of a competitive game. To learn more about CELEMI Learning Space™ click here.
Business simulations are effective in both a face-to-face and a virtual setting. Face-to-face settings allow for enhanced networking and interpersonal communication. Virtual settings allow vast geographies to get together more often with less travel expenses and less time out of the office.
Often, virtual delivery of simulations is broken into smaller segments of time. This allows learners to process information and come back with fresh ideas and perspectives.
Whether an organization chooses a physical or virtual classroom depends on its culture, geography, size, and budget.
Doing shorter experiences online and opting for longer experiences in the physical classroom gets people “together” more often. Its impact can go far beyond the learning objectives in the simulation.
One benefit of business simulations is that there is not a lot of necessary prework.
Let’s face it, on average, a small percentage of participants come fully prepared to class. If your organization is typically successful at coming into a learning experience with great care given to prework, learning and development professionals can request more extensive prework and reduce the necessary class time.
In this instance, a more extensive prework assignment might make the typical scenario setting a facilitator does at the beginning of class unnecessary. It allows you to add agenda items that may not have previously been available.
However, if your organization is like most, you should allow participants to show up ready to learn with time allotted out of the office to focus exclusively on the experience.
Breaks and mealtimes are built into the experience for checking messages and answering questions back on the job. Make sure the facilitator knows what learners need to enable full focus on the learning.
A bit of care up front makes a big difference.
Business simulations can be excellent capstone experiences set at the end of a learning journey. They can stand on their own for executive development, leadership development, or to upskill an area such as business acumen or agility that needs to permeate your organization.
Once a training need is identified, our professional consultants can help you choose the right business simulation for your audience and objectives.
The reason business simulations are excellent capstone experiences is their ability to engage learners in applying principles learned through previous lectures and exercises.
In this way, they can be thought of as an assessment of the knowledge obtained earlier without real-world consequences. Practice makes perfect!
With over a dozen business simulations to choose from, Celemi's pre-designed (or off-the-shelf) business simulations can be deployed with a lead time of 2 weeks.
This efficiency is valuable in making a business impact now. Our off-the-shelf simulations feel custom every time because facilitators work with you to learn your objectives. Real-world examples are shared in class, and application exercises during and after class are designed specifically for your organization.
In addition to using the pre-designed simulations as is, we can also customize portions of the pre-designed business simulations for the perfect fit!
Customizing in this way is efficient and effective. You participants feel like it was made specifically for them; however, the lead time is still minimal in getting from customization to class time.
Sometimes, we recommend a fully customized simulation.
This occurs when your industry is not typical. For example, how an insurance company makes money is different from how a manufacturer or a service company makes money.
In this case, we will start from scratch and create from a blank canvas. Another example of when it makes sense to create fully custom is with onboarding experiences. Your history, your strategy, and your culture are unique to you.
A fully custom simulation or solution allows you to share your uniqueness with your newly hired professionals. If we don’t already have a business simulation that fits your learning objectives, we’ll build one.
We use an agile method of development with an iterative approach to enable you and your subject matter experts to shape the simulation from start to finish, guided by a learning design professional with decades of experience.
Competition in the simulation is fun and exciting. However, if the focus is too much on the competition and not on the learning, some of the learners will feel threatened and disengage.
Creating healthy competition is addressed upfront. Being professional is required throughout the simulation.
Competition surfaces behaviors that professionals often work to suppress. Healthy competition surfaces behaviors that professionals can be aware of. Now that they are aware, the motivation to work on these behaviors increases.
If we create awareness in a safe environment, great leadership develops!
The learning application exercises deployed during and after the simulation transition the aha moments in the simulation into application in the real world. This is where every simulation has an opportunity to pay for itself – over and over.
Great business decisions made consistently have an opportunity to change your organization for the future. To go the extra mile means that your organization can receive the gift that keeps on giving. As a learning and development professional, this sets you apart.
Business simulation providers vary in quality. Choosing one that is known specifically for the teamwork aspect is rarely the right choice.
All team-based business simulations foster teamwork, collaboration, develop debate and negotiation skills. This is an added benefit that is baked into most simulations.
What is key to choosing a supplier is how well the simulation mimics real life.
The algorithms created in the simulation should create outcomes that are duplicated in real business. Circumstances change and depending on markets, know-how, and resources, outcomes obviously vary.
However, could this happen in real life? That is the question you should ask. If the answer is yes, you are likely in the right place.
Another aspect of choosing the right simulation provider is scalability. Is the simulation available in the languages you need? What is the minimum number of participants? What is the maximum number of participants? Has the provider considered your culture or the global nature of your business?
Last, is the business simulation provider good at service? Do they have an array of facilitators to choose from? Will they support you and your efforts to make certain each session is high quality, and each participant feels like they are valued? Do they understand your industry? Are they willing to take time to get to know you and your business thoroughly?
Ask the right questions to see if your provider is the right fit for you.
Your business simulation provider should offer a choice of facilitators. You should be able to interview a few who are recommended to make certain they are a good fit for your culture and industry.
Do they have experience in your industry?
Are they culturally a good fit?
Are their demographics aligned with your desires?
Do they offer an array of languages if you are a multinational organization?
Experienced facilitators often know when they are not a good fit for your organization and can recommend colleagues. We have a highly sought-after facilitator who is methodical in his approach. Still, he is not everyone’s cup of tea.
You may have a good experience, but you can see more potential with a more energetic facilitator in the future.
We get it! Communication is key in finding the perfect fit.
