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It is commonly believed that fun and games are incompatible with professionalism in business. It’s no different in the automotive industry.
I regularly ask colleagues about their best training experience: simulations are at the top of the list.
Because “serious games” or business simulations are amazingly effective in changing attitudes, shaping mindsets and learning new behaviors – all of which are vital for survival in the automotive transformation.
It’s time to better understand serious games in the automotive sector. Profitability, a British team of Cambridge graduates that has been developing and running business simulations since 1983, invited me to experience a business simulation first-hand.
I spoke with founder Brian Helweg-Larsen and Graham Hutchins, CEO of Profitability.com.
Why business games or serious games?
Simulations, such as “war gaming”, are used for decisions where the stakes are high. What exactly are “serious games”?
Brian: A serious game is meant seriously and delivers serious learning outcomes.
For example, when playing the leadership of a team in a crisis situation, the behaviors shown in the game are a direct demonstration of the behaviors shown in real life, positive or negative. However, without the serious consequences associated with them. Through reflection, participants can learn something about their own behavior and then react differently in real-life situations.
How long have serious games been around?
Brian: I first came into contact with serious games in the late 1970s when GEC (General Electric Company), then the largest company in the UK, used serious games in management development. I saw the impact it had on employee satisfaction and engagement.
At first, I worked with simulations that others had developed. I began to adapt and modify the products available on the market to meet my learning objectives. Then, almost 40 years ago, I decided to build my own simulations. Over the past 40 years, I have developed about 180 simulations. Many of them are financial simulation games, but some have gone in quite different directions, such as helping people understand how to deal with change, develop leadership skills or get feedback on their personal interaction with others to promote inclusive leadership.
We have developed a wide range of serious games that focus on business acumen, change management, leadership and team skills, ESG awareness, talent management and inclusive management.
The theme that runs like a red thread through everything is that people learn by doing things themselves, rather than taking endless passive e-learning courses or suffering “death by PowerPoint”, which is still often seen as training but involves very little learning. Because when someone experiences something in a simulation, from their own experience, you don’t have to convince them how certain things work, they have convinced themselves.
An example: business game in the car trade.
I took part in one of your simulations, “Dealership Profitability”, a simulation of the business model of a car dealership on a game board. What makes this game so realistic?
Brian: What you experienced is a great example of how simulations can be used to achieve something that I don’t think would be possible by other means.
In the simulation, there are new cars, used cars, spare parts and service in a car dealership, which is complicated. There are actually four divisions that all work together. People need to experience the business for themselves to understand how it works. Even if you’ve worked in a dealership for a long time, you may not really understand how the different parts interlock.
For example, when you see how the sale of used cars promotes the service business, which accounts for most of the profit. Great efforts are required to sustainably support new car sales. There also needs to be a well-stocked and readily available parts inventory to support service. The relationships between these two areas are very complex, as are the cash flows between them.
If you can enable people to take a bird’s eye view by using a physical board game that shows where the money is tied up, then these people understand on an instinctive level how the business works, in a way that normally takes years of experience to develop.
Business games are like a flight simulator – you can’t break anything.
So you can learn something very realistically without ruining anything?
Brian: Yes, it’s like a flight simulator.
Because it’s all a game. If you make a mistake and crash, nobody gets hurt. And there are no financial consequences either. It’s all fictional, but it feels very realistic because we develop simulations based on business experience and industry knowledge.
Insights gained during the training are applicable the next day in the workplace, as they come from real life and have been incorporated into the simulation.
You mentioned 180 simulations, Brian. What were the most effective simulations developed for? What are some examples and special features of these simulations?
Brian: A lot of simulations on the market are the same product in a different package. Some vendors ask, “Do you want an insurance simulation?” “Fine. Insurance simulation here, beverage marketing simulation there.” It’s always the same engine, the same drivers and the same choices with a different interface and a few different terms, which is a poor reflection of the industry.
Quality is achieved when your simulation matches the industry-specific drivers for success and failure, profit and cash flow.
The three main drivers of a fast food company, a car dealership and a bank are completely different. One simulation does not fit all industries. But if you base the simulation on a detailed understanding of the industry, it will be incredibly realistic and transferable to the real world..
So the challenge in creating an excellent simulation is to gather learning objectives and industry knowledge and put them together in a game format so that people can learn in a few hours what would otherwise take many years.
So you start by analyzing, similar to a research or consulting assignment. Do you immerse yourself in the customer’s problem scenario in order to understand the industry-specific drivers?
Brian: Definitely. For example, we interviewed the managing director and marketing director of Guinness in a customer project because they knew exactly what attracts loyal Guinness fans and keeps them with the brand. We developed a game based on the knowledge gained from decades of professional experience. Cash flow optimization was the learning objective. And the participants learned in a Guinness environment that exactly mapped the Guinness market drivers and financial challenges.
Many people don’t realize that the beer business works with a huge amount of beer barrels in circulation. The kegs leave the brewery, are stored in a warehouse and then go to pubs and restaurants, where they sit for weeks. And the amount of money that this ties up in the distribution chain is enormous. If you don’t model this in a simulation, the simulation is wrong, unrealistic. But if you model it, people immediately understand why a faster turnaround of the kegs is so important, because they see how much cash is tied up and how much money could be freed up.
These games are also fun.
Brian: Great fun. and also create rivalry between the participants.
And this competition can overshadow the learning. Sometimes we intentionally make the game less competitive to get individuals to focus more on reflection and what they have learned.
Remote or on-site implementation?
Your trademark is traditional board games for companies, but you mainly sell digitized games. Given the trend towards more online learning, what do you prefer?
Brian: There’s no doubt about it: bringing people together in one room has advantages. Especially when they come into contact with other experts from the company that they wouldn’t otherwise meet. You learn from each other, even beyond the event. Many companies are willing to cover the costs of travel, accommodation and everything else to take advantage of this.
For other companies, this is less important. They focus on the learning itself. In this scenario, it can be just as productive to do the learning online, for example with Zoom or Teams. Sometimes it is even more productive.
However, our criterion is to adapt the simulation to the customer situation and the specific learning objectives.
Before COVID, I didn’t believe that online simulations could be as successful as face-to-face training. But since the pandemic, we have many examples that this can be the case. In certain circumstances, people may never return to face-to-face training. In some cases, our customers returned to traditional delivery. They appreciated the added benefit of direct human interaction and physical contact, as well as the sharing and campfire feeling.
Some learning objectives are much easier to achieve in face-to-face training with tangible game characters. For example, we have a simulation in which participants make greeting cards by cutting up paper, writing “Happy Christmas” and “Happy Birthday” on it and then giving it to a customer. And whether the card is well or poorly constructed is irrelevant. To achieve the same level of freedom online, more technical creativity and budgets are needed for implementation.
Graham: The costs for digital or classic implementation vary. What is the trend among the competition, what are your customers saying? In which direction is the industry developing?
Graham: Throughout the pandemic, everything had to take place online. That required a huge amount of creativity from us.
There has been huge investment by all companies in all forms of digital learning. In some cases, this has been successful. However, research shows that digital learning often leads to ‘screen fatigue’ and a lot of digital content is not being adopted. The desire to bring people together physically is returning. It could be a digital game, but participants still come together physically. As Brian mentioned, the learning experience is much better when it’s done in the traditional way. That’s what most people prefer. We are just social animals.
However, travel time, costs and CO₂ emissions can be too great for face-to-face training. Many people are even busier these days and even less willing to travel for business.
Buyers are increasingly demanding shorter, more flexible and digitally supported meetings. A hybrid model, where some learners are present in the classroom while others participate online, is the middle ground.
Brian: Research shows that spreading learning over days or weeks leads to better results. Online training is obviously better for this approach.
Based on my experience with simulations, I particularly appreciate two functions. Firstly, the opportunity to have a haptic experience, for example by being able to count real money on a board or see the current vehicle stock. Secondly, I appreciate the campfire feeling that the simulation creates. People meet, drink coffee and chat. They spontaneously exchange knowledge and experiences. This kind of exchange is difficult to replicate in digital games.
Brian: It’s beneficial to do things physically by hand in order to learn.
When training employees to understand a profit and loss account and a balance sheet, it is helpful to enter the figures in the table by hand. This makes it easier to internalize the concepts involved. It is not necessary to do it 18 times by hand to learn it. The first few times can be done manually to help. After that, it can be digitized and automated to save time. We have prepared computer models for several of our simulations that run in parallel with the first rounds. Later rounds then focus on decision making.
Graham: We are seeing that digitalization can be more inclusive for learners with specific needs. Compared to the classroom, we can connect better digitally. If someone has difficulties with the dominant language, they can write in chat or use emoticons to contribute without having to hide.
What are the limitations of simulations that affect their efficiency?
Graham: Simulations are great when we are dealing with complex, multi-layered problems.
We do not create simulations to teach closed skills. Learning the violin or programming in Python, for example, can be done using established methods such as YouTube or e-learning. Individual training is more suitable here.
But when this violinist plays in an orchestra or this programmer is integrated into a software team, everything changes. Suddenly you have to perform under pressure in front of other people. And the ability to empathize, collaborate and understand the big picture becomes critical to success. We can create simulations for precisely these scenarios.
As Brian mentioned, we offer learners the opportunity to practice in a safe context while preparing them to apply their new skills in the real world.
This seems to be suitable for management decision-making. In the dealership simulation, participants can understand how the strategy affects the business. Investments can be made in cars, machines, service, spare parts, people and marketing. It is a real-life decision dilemma.
Graham: This trader simulation is great. It focuses on business acumen, financial knowledge and a thorough understanding of how the complex internal and external business relationships work. The simulation is fantastic as it provides a realistic experience.
However, when reading the feedback from participants who do not work directly for the trader, it becomes clear that the simulation primarily promotes empathy for traders and their various functions. Empathy is a very human quality that is not always associated with financial knowledge.
And this is just another example of how you can develop so many technical skills. However, these skills are ineffective if they are not linked to human understanding. Many other learning methods cannot do this.
Brian: Simulations are ideal for illustrating the long-term effects of decisions. For example, you can go through the entire business cycle of a year in just a few hours. In real life, however, it can take several years for the results of a decision to become visible. During this time, you may have changed jobs or left the company, leaving you with no opportunity to learn. Simulations promote a long-term perspective. They help with day-to-day decisions and promote sustainable company development.
Business games achieve a Net Promoter Score of 95%.
It is worth noting that the net promoter score for this course was 95.
Graham: The feedback is amazingly good. The average Net Promoter Score in the industry is perhaps 40, and many companies are happy with a better NPS for training.
Brian, is this typical for simulations?
Brian: Learners prefer simulations because they would rather do something and talk about it than be lectured to and have to listen. Simulations in general are rated, but a well-done simulation gets very good ratings.
That’s why we get such high marks for it.
Graham: HR departments need to finally get over the “Happy Sheets: How satisfied were you with the event”.
This feedback is too simple. The goal of learning is to change behavior and improve business performance. However, HR often struggles to understand the business challenge they are supposed to solve.
The best learning programs are simple and clearly structured. They solve a defined business problem and their effectiveness can be quantified against business KPIs. A variety of learning methods such as e-learning, coaching, workshops and simulations can help to make learning varied and effective.
I have the impression that one day we will live in the metaverse for business and play “The Sims”.
Graham: If learning is to remain relevant, it has to fit in with the realities of how companies actually are.
The training should be difficult and take the participants out of their comfort zone. Sometimes participants don’t like the training because of these challenges.
Although we often get very good Net Promoter scores on some of our soft skills training courses, some participants don’t like them at all. They feel pushed, challenged and stressed. In life, we often feel uncomfortable when we are out of our comfort zone. We often don’t like it, but later we discover that this is where most of our learning takes place.
If the training, be it in the form of workshops, lectures or e-learning, is only geared towards a pleasant experience, it moves further away from the reality of a highly dynamic working environment with real pressure. This certainly reflects the experience of many employees.
Of course, a good blended learning program also offers time and personal space for coaching, mentoring and personal reflection, in which experiences can be meaningfully processed.
Sounds like a difficult sales story: selling a game that challenges participants doesn’t go down well with everyone, does it?
Graham: This requires customers with an eye to the future.
Fortunately, companies like PepsiCo and Schneider Electric are working with us today. We have fantastic leaders who understand and recognize that they need to look beyond the “happy sheets” to look at mid-term business outcomes. When you encounter training buyers who are only interested in the happy sheets and don’t ask about business impact, attendee satisfaction is the only thing you need to show. However, if you offer participants a free day of whitewater rafting, they will probably love it. However, this will not necessarily lead to an improvement in competitiveness.
Simulation games change attitudes and ways of thinking in the long term.
Brian: Simulations help to change attitudes in the long term.
I have heard several senior executives say that the mindset or attitude of their employees needs to change.
For example, subject matter experts must now adopt a management mindset that includes developing talent and growing their workforce. People coming from a highly controlled environment and now working in a competitive industry need to think differently. Because only a different way of thinking will lead to success.
When you put teams through a simulation, they will find out together what works and what doesn’t in this new environment. The peer reinforcement in the team discussion lets you figure out how things work. “It didn’t work last time; we need to do it this way around.” And that’s how we do it. And then they get feedback. “Oh, that worked really well, great.” Now we know what works.
Simulations develop knowledge, skills and attitudes.
Brian: Skills and attitudes are more important than knowledge. If you just want to impart knowledge, there are probably cheaper and easier ways.
But if you want what you have learned to be applied under the pressure of daily life, then a simulation can be much faster. This is because a simulation embeds what you have learned in the work context.
Graham: Knowledge is not the problem. You can ask ChatGPT anything. The challenge is to apply this knowledge on a large scale through collaboration and communication.
Speaking of AI – what role does it play here?
Brian: This starts with the development of ideas and simulation content. Chat-GPT is able to create complex scenarios and analyze the features and benefits of decisions very efficiently.
One focus of our simulations is behavioral observation. And AI is not yet good enough for this. You still need a trained human coach to closely observe certain behaviors of the participants – such as empathy or aggression.
Graham: Speech recognition, recognizing changes in a person’s tone of voice and inferring moods are still weak points in AI, but as Brian says, these new technologies can help us write role-play briefings, create scenarios and much more.
Our customers are global companies such as PepsiCo, Schneider Electric, Roche and others. Although they are solving the world’s biggest problems, learning solutions still need to be very pragmatic and scalable at the same time. During the pandemic, we have seen many of our competitors invest heavily in early-stage metaverse or VR headsets, which has either not worked because customer IT landscapes cannot support these approaches, or because the technology gets in the way of an effective learning experience.
We believe that serious games should be part of a blended learning program. At the same time, self-directed learning journeys should have their place. There are many new technologies that enable things like nudge training or microlearning. These are great for preparation and reinforcement. But nothing can replace the engagement, energy and direction that comes from people learning together. Without social learning, learning is unlikely to make a real difference in the organization.
What advice would you give the CEO, CTO or CLO in the automotive industry? Why should simulation be used in the learning process?
Brian: „If you can’t change the people, you will have to change the people.“
It is much cheaper and more effective to retain organizational memory and expertise. If you can change the mindset of managers, you avoid losing a whole army and hiring another army and starting again from scratch. If the intention is to achieve an attitude change or a change of direction in thinking across the organization, then simulation is a really powerful tool.
Graham: DDI’s annual forecast, a survey of around 14,000 executives and CEOs, highlights that: Social learning combined with professional coaching are the two most sought-after types of learning experiences. People’s desire is to come together to participate, test new behaviors and gain new attitudes and ways of thinking.
“Serious games” change attitudes, thinking and behavior. What a great summary. Thank you Brian and Graham.
About Profitability.com
PBS has been developing and delivering game-based learning experiences for over 35 years with some of the world’s largest companies including Ford, Volkswagen Group, JCB, Nestlé and Cargill.
