Cheaper technology and the rise of the "Gamer Generation" are leading companies to embrace online games and simulations for everyone from new employees to seasoned executives.
The promotion to manager sounded like such a good thing. Of course, that was before deliveries to dozens of clients got mixed up, seven mid-level employees quit after months of being overworked, and your boss began voicing concerns that you're not qualified for the job after all, and asked you to present your proposed solutions to the mix-ups and employee turnover at a big meeting in 24 hours.
Quick, choose which one gets your attention! Do you solve the delivery issue and delegate the other two, work with an HR manager to figure out how to stop the hemorrhaging of employees, or work on your presentation to the boss?
Feel the sweat beginning to bead on the back of your neck? You can relax -- this is just a computer game (in this case, a management simulation from Stamford, Conn.-based BTS USA) designed to teach managers how to make the best decisions for a company. It's also the wave of the future. This simulation and dozens like it are being used to train employees -- from new hires just out of high school to managers and executives -- how to balance their job responsibilities in a more effective, results-driven manner.
Once the exclusive tools of the military and government, high-tech computer simulations are gaining popularity with companies of all sizes.
"The simulations that allow managers to go through scenarios and spend money opening more stores, or launching a Web site or marketing this area or another, are becoming more common," says Josh Bersin, president of enterprise-learning research firm Bersin & Associates in Oakland, Calif. "It's probably a $100 million to $150 million industry right now. That's not super-big, but it's growing."
Bersin says large companies have enjoyed simulations almost exclusively until now for a simple reason: Good sims are expensive to build.
"Some of these things are very standardized and have become very simple to build," he says. "But the more complex simulations still cost hundreds of thousands of dollars to construct."
Nevertheless, the prices have come down sharply during the last few years, thanks in no small part to cheap and readily available tools such as Adobe Flash, made by San Jose, Calif.-based Adobe Systems Inc. With Flash, it's much easier for companies to create interactive online videos that can feature different scenarios based on input from the viewer, says Bersin.
These days, companies can expect to pay $25,000 or so for custom-built, company-specific online videos no longer than 30 minutes, while longer and more interactive simulations that walk viewers through company-specific scenarios can cost anywhere from $50,000 to $75,000, says Bersin.
Meanwhile, other firms are putting online games to new uses to make their training more engaging and relevant to the so-called "gamer generation."
For example, there was a time when the first few days on the job in a retail store meant following a manager around, watching one's new co-workers, and diving into pages and pages of dry training materials in a huge three-ring binder. If you've ever had a job in the mall, you likely remember this sort of thing.
New hires of The Children's Place, a chain of children's clothing stores based in Secaucus, N.J., will likely never experience those mind-numbing introductory days to their new jobs. Instead, they'll spend time sitting at a computer terminal, playing what feels a lot like a new video game, to learn their roles and responsibilities.
Dozens of companies nationwide, from Cold Stone Creamery in Scottsdale, Ariz., to Canon USA in Lake Success, N.Y., have dumped the three-ring binders in favor of new e-learning tools that incorporate the thrill of a video game with new-hire training and managerial development. These games and simulations offer everything from running-the-register training to the opportunity for managers and executives to test new marketing strategies to see how they might work in the real world, without risking a thing.
The vendors that make these games and simulations say the marriage of fun and learning is a perfect one, allowing executives and new trainees to learn while doing something that feels like recreation. Companies that use such programs agree, saying employees learn much more through interactive play than they do reading manuals or listening to lectures. And HR experts say the phenomenon is the start of something that will feel completely routine and natural in the not-too-distant future.
Ladies and gentlemen, start your computers.
An Idea is Born
Justin Kennedy launched Brooklyn, N.Y.-based Imagery Media in 2003 and was soon developing online animated games for The Cartoon Network's Web site. The games generated a lot of attention, and the company developed a game for presidential candidate John Kerry that combined fun with some key points of his platform.
Soon after that, Kennedy got a call from Canon USA, which manufactures copiers, among other things. Copiers have a lot of parts, and technicians need to know about all of them. Would Imagery Media be interested in developing an electronic simulation that felt like a game, but could teach Canon employees how to fix copiers?
Intrigued, Kennedy got to work and soon developed exactly what Canon was looking for: a simulation that lets users take a copier apart, put it back together, solve problems that might occur and click on individual components to learn what they do.
"[Simulations] were an area of business we hadn't thought about," he says. "We'd been focusing on entertainment and games for kids. But the comparisons we saw with Canon were fantastic."
Canon got its simulations, and Kennedy used the opportunity to begin marketing Imagery Media as a company that produced e-learning solutions for adults. "That area of the business has really taken off for us," he says. "A lot of companies are calling us to do corporate training work."
That's true at BTS USA as well. To date, BTS has developed e-learning solutions and simulations for dozens of companies, including several in the Fortune 500.
"What's different with simulations versus other learning, and the reason they're growing in popularity, is that they're discovery-based and action-oriented," says President and CEO Jonas Akerman. "A lot of it is taking what you might have learned in a book and making it electronic. If you can get people to play, it becomes a lot more interactive and fun. You don't even know you're learning until afterwards."
His company's simulations combine the graphics of a traditional computer game with situations that ask participants to make decisions -- do you address the delivery problems or personnel issues first? What will the board say either way? Which crisis will have the biggest impact on the company if it's not addressed right away? Each decision builds on the last, and participants see at the end how each decision affected the big picture of running the company.
Many simulations take a similar approach. David Cochran, vice president of Qual Pro, a Knoxville, Tenn.-based developer of business simulations, says, "We've done over 14,000 projects, and the hard data is that only 25 percent of the improvement strategies that are put in place by managers actually work, 23 percent move the results the wrong way and 53 percent make no difference. The fundamental message we take to managers and executives is that if they don't have some way to test the actions they're going to take, these are the results they'll get.
"A lot of training is practicing individual skills," Akerman continues. "What simulations allow you to do is put all of those individual skills together and see the picture in a more realistic setting. It's like playing a tennis match -- it might not be Wimbledon, but it simulates what it feels like to play the game."
Fun and realistic training was exactly what executives at The Children's Place were looking for when they contacted Maumee, Ohio-based Root Learning to develop a simulation on loss prevention and store safety for new employees.
"[Children's Place] wanted to spice up what is typically pretty boring training," says David Serdynski, managing director of e-learning at Root. "The stores' sales associates are typically groups of 20-somethings who have grown up with the Internet and computer gaming. It's what they're doing on their own time. We tried to bridge the gap between learning and what they do for fun."
Root developed a 12-module simulation that asks employees to make split-second decisions on loss-prevention issues. Participants explore a crime scene, interview people at the scene and use tools found in an electronic toolkit to try to figure out the best way to handle the situation. The simulation takes about an hour to complete.
"We wanted the learning experience to be engaging," says Stephen Barankewicz, manager of learning and performance at The Children's Place. "Simulations, coupled with a learning partner at the store, are proving to be the right mix. The gaming generation consists of anyone between the ages of 18 and 34. A majority of our associates fall in that demographic."
While younger employees might be more comfortable with simulations and games at the outset, Serdynski says, Root has tested its products with older audiences and found little to no problems getting them engaged with the games. "I'm a bit older," he says. "The type of training I'm used to is sitting in a classroom while someone talks. The younger audience is much more accustomed to having the Internet and being able to pull up information when they want it.
Rather than someone pushing information to them, they can explore and pull information from the module."
Electronic simulations and games can also be used to foster friendly competition among employees -- a benefit some companies find helpful and conducive to learning for high-potential employees as well as new hires.
Last year, Atlanta-based telecommunications firm Cox Communications commissioned BTS USA to build a simulation that allowed middle-management trainees from 22 different regions to compete online. About 130 or so employees were divided into teams and worked together making decisions on marketing, operations and staffing at a simulated company.
"We had several different rounds in the tournament and the teams would run the business using different strategies," says Melanie Cadenhead, Cox Communications' director of leadership development. "The winner was the team that ended up with the best results in operating cash flow and overall customer satisfaction."
The simulation has since been modified for use in the company's routine classroom training, she says.
"The intent behind it really is to help them understand the strategic point of view of running a business," says Cadenhead, adding that the simulation helps participants learn to think "in a big-picture way" because they can immediately see the impact of their individual decisions on the company's overall health. "When you're trying to look at a whole system, the business simulation is a great way to pull out various parts that impact the whole in decision-making. It's a fabulous tool."
Some software developers have built business simulations for clients that present an online replica of the client company, right down to its organizational structure and strategic goals. Instead of playing a generic business simulation, players practice running their own company, facing decisions they'll likely face for real at some point in time. That specificity can greatly benefit employees, say the developers of the games, and is a big reason many companies are willing to put in the time and expense of developing their own simulation games.
"I always use the analogy of a pilot," says BTS's Akerman. "Imagine how good he'd be if he listened to someone talk about flying a plane and read a book on it, and then got into the cockpit. I don't think he'd do very well."
Another benefit of custom simulations is that executives and software developers can work together to incorporate the everyday interruptions and complications that employees may face in the real world, right down to banalities such as interruptions by an annoying co-worker.
"You can go down a lot more different avenues and throw curveballs," says Akerman. "People come in and disturb you and something happens that might happen in real life. You can make the scenario a lot richer."
Bersin says there are four basic levels of learning on a corporate level:
* Awareness. Employees are aware that they need to do something or change something. This is generally learned through reading or listening.
* Understanding. Here, people read or listen well enough to take a test on the material.
* Application. To apply a concept to a real-world scenario takes a better understanding of it than taking a simple test. Here is where simulations come in. Participants apply book knowledge to a fluid scenario and see what happens because of their choices.
* Mastery. Someone can apply knowledge to a simulation, but apply it under a large number of different conditions. This can take years to achieve.
"An Air Force trainee flying an F-15 can crash it 200 times, and each crash is different," says Bersin. "There are 200 mistakes he can make before he gets into a real plane. In the business world, there are some problems where mastery is required. But the cost of building mastery into a simulation is very, very high."
Still, some companies find they're the best way to teach. "People are looking for a fun, efficient way to learn," says Qual Pro's Cochran. "An executive might be very busy and you're not going to get much of his time. He can take a couple of minutes and go through one of these and not only get some good ideas, but have a good time doing it."