Team-based business simulations - in which participants work as a team to make decisions to address a business challenge - provide a unique forum that enables leaders to integrate their learning across multiple disciplines.

A team-based business simulation creates a rich environment for multiple levels of learning, and is one of the few learning tools to challenge leaders to integrate their competencies across both soft and hard skills. Strategic leaders have both skill sets: they think creatively about business choices and can lead their organization to deliver results. To maximize your ROI from the use of a team-based business simulation, make sure that you are focusing the experience design and learning debriefs on both business decisions and leadership behaviors.

Steps For Effective Use of Business Simulations

The job of leadership is tough and getting tougher. As global operations become the standard in business, and all communications become real time, leaders are challenged to think more quickly and act more comprehensively than ever before. Leaders must adapt their business actions real-time to diverse challenges, and adjust their leadership styles to work productively with employees with strikingly different cultures and needs. Strategic leaders continually develop and hone their understanding of the core dynamics of their business (which choices deliver results) and their capability to lead a team to accomplish a goal. Business simulations are a unique tool to help organizations prepare their employees as leaders with both skill sets, and to strengthen the capabilities of those already in leadership positions. The right business simulation will capture the pressures and dynamics of today's business environment and demand that a leader respond with both business choices and leadership actions.

Team-based business simulations - in which participants work as a team to make decisions to address a business challenge - provide a unique forum that enables leaders to integrate their learning across multiple disciplines. Success in the simulation should certainly require teams to understand the business, digest complex information, and make sound business choices. However, to be successful, the group must also communicate effectively, make shared decisions, and contribute their individual strengths to the process. Few leadership development activities demand that learners engage both their analytical and human skills so completely, or provide such an engaging forum for valid feedback and constructive development coaching.

Team-based business simulations create a vivid environment for learning: participants engage in issues, demonstrate their natural behaviors and build both business acumen and self awareness. Overlaying the interpersonal dynamic of team-based decision making demands that leaders lead, not simply think about leading. Using a team-based business simulation to develop strategic leaders, however, requires specific characteristics. Here are 6 insights for increasing the impact of a business simulation targeted for strategic leadership development:

1. Select or design a Business Simulation with interrelated choices and multiple paths to success.

Leaders manage multiple tensions in a business: choices that require trade-offs among cost, value, time, organizational commitment, employee capability, customer satisfaction, etc. There are few simple, "right" or "best" answers. A business simulation for leadership development should pose challenging choices, and not offer a single right answer path to success. Simulations which test and develop leadership skills will pose a mix of strategic and tactical decisions, and require participants to think consistently from big picture to specific actions. The more interrelationships that exist among the decisions in the simulation, the more carefully a team will need to work through their options and the more challenging it will be to come to a single decision. The realism of this approach in a well-constructed simulation will provide a foundation for discussions about both business issues and behavioral dynamics.

Computer based business simulations help employees at all levels understand the fundamental economic drivers of a business: what drives revenue, what impacts profit, what shifts competitive performance. Numerous simulations, adapted from economic modeling of industries or organizations, exist in a wide variety of formats to support training and education about fundamentals of business economics and theories of competitive strategy. These simulations are increasing in sophistication and entertainment value - and are a uniquely engaging technology for educating employees about complex content.

2. Use a Simulation with decisions about leadership resources, not just budget allocation.

Leadership choices are rarely "pick one". Leadership decisions are not often as well defined as the allocation of budget dollars. The currency of leaders is broader than money. A mix of the decisions and activities in the simulation should also reflect the "soft" choices of leadership to provide an effective foundation for developing strategic leadership skills. (What messages to convey? What tone to take? How much time to invest? What sequence to address issues and individuals? Who to engage in which discussions? Whom to assign specific tasks?)