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January 2015
About some advantages of Dynamic Simulation
I wrote two posts in Hebrew about the advantages of Dynamic Sim...
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 Preparations- tasks to be completed by the participants before the start of the
simulation the following Monday.
Befor...
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Three hours later we gathered the participants for a debriefing. It was the first time in which
all the participants sha...
4
replaces a strategic supplier with another one, or what could happen if an increase in sales
results in a severe decline...
5
The creativity of the team that acted as the major player found a different and innovative
direction. Following this, th...
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Some Advantages of Dynamic Simulation

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Lessons learned from two dynamic simulations conducted by me

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Some Advantages of Dynamic Simulation

  1. 1. 1 January 2015 About some advantages of Dynamic Simulation I wrote two posts in Hebrew about the advantages of Dynamic Simulation. This English version combines both of them. *** The first was written after a very successful simulation that was conducted for a company management team. For reasons of confidentiality I can not specify the name of the company in which it was conducted. I limit myself to note that the company runs a plant that produces finished and intermediate products which are sold to worldwide customers. Background A few weeks before the simulation the company's management found that a major stakeholder, who maintains ongoing working relations with their company, changed the rules of the game. This change required the management to make decisions and to react. Their reaction was met by further moves by this major stakeholder, which required an additional round of evaluation and decision making. In this situation, someone suggested using Dynamic Simulation game to evaluate possible developments and their implications. It was Wednesday when I received the phone call asking me to run the simulation and to finish the whole process within five days. On Thursday I met the CEO who briefed me about the current situation, followed by brief discussions with some other top executives. Three hours later we held a briefing for the team of participants in the simulation:  Who will be the "players" whose actions will be simulated e.g. company's management, the "major stakeholder", clients, suppliers, competitors.  Participants – who will be the company's people that will simulate each "player"  Rules of the game e.g how data will be transferred between the "players" - in writing or orally, what happens if two "players" want to meet face to face etc.  The "opening story"
  2. 2. 2  Preparations- tasks to be completed by the participants before the start of the simulation the following Monday. Before we go on, let me refer to the great significance of the crewing of the "players". In all simulations, one can get totally different results, with the same opening story, and the same rules of the game, depending on how each of the participants simulates its "player". Usually, the participant's "acting" during the simulation is determined by his personal opinion about the strategy and actions of the real "player" as well as by his ability and willingness to take an active role during the simulation. For example, take a game held by a MVNO (Mobile Virtual Operator receiving cellular infrastructure services from a network company), that examines issues related to its relationships with the network infrastructure providing company. The results may be totally different according to the views of the participant that plays the part of the network infrastructure company – does this person considers the network provider as a cooperative partner or as an hostile one. In our case, all participants were very active. The subject was very important to the continued operations of the company, and all had their own strong opinions about the evolving situation. The range of views was relatively large and the diversity was expressed in the ways in which every one of them played his part. Simulation Description As planned, we met on Monday for the active dynamic simulation itself. The "opening story" was based on preliminary steps taken by "players" after the briefing on the previous Thursday. Then, for about three hours, intense activities took place - messaging, fighting for territories, secret meetings, and more. Here and there the directorate (a board member and myself) leaked information to a "player", based on assessment of the likelihood that such a piece of information would reach him in real life. During this time I deliberately made sure that discussions and meetings were short and decisions would be taken as soon as needed. This kind of pressure has two benefits: A. It assures that the simulation is dynamic. B. The time pressure makes most participants act more spontaneously and thus reveals their basic world views.
  3. 3. 3 Three hours later we gathered the participants for a debriefing. It was the first time in which all the participants shared all the developments and data of the simulation. For some of them it was a total surprise. Mainly, because they were not aware to negotiations conducted between other players. More than that, the scenario that evolved in the simulation was totally different from the scenario which the management was considering before the simulation. All of the participants agreed that this new scenario is possible and that the company should make decisions accordingly. Lessons learned And so, the simulation achieved a very important and impressive result -a paradigm shift of the management team. This was achieved thanks to the combination of –  The management's willingness and openness to adopt a different process of decision making,  The full cooperation of the participants before and during the simulation,  The managing of a dynamic and rhythmic simulation that created stimuli for participants, I allow myself to say that it is doubtful whether it was possible to achieve this paradigm shift in a different way. *** Now to the lessons learned from another Dynamic Simulation. The preparations to this simulation were longer than the first one since the opening story included a draft of an agreement. The longer preparation time allowed the simulation Directorate to draw a flow chart of possible developments during the game in order to check possible deadlocks. Deadlock occurs when all the "players" stand still and do not initiate new moves. Every player is waiting for the other players' moves before deciding on his move. And so everyone is waiting for everyone and the simulation actually stops. There is nothing "wrong" when deadlock occurs: When it happens, it is one more lesson learned from the simulation as we can assume that such a scenario may also happen in real life. Simulations may produce more than one possible scenario. We can use the simulation to check what could result from possible events or "moves". For example, if a player
  4. 4. 4 replaces a strategic supplier with another one, or what could happen if an increase in sales results in a severe decline in sales. The Directorate may include these types of moves in the "opening story" or they may intervene and "break" a deadlock by forcing a player to make a certain move. In order to keep the momentum of the simulation, the directorate has to identify a deadlock as soon as possible and to inject the next event immediately – which is why the Directorate should try to draw a flow chart of possible developments of the simulation.. That's what we did during the preparations. We tried to assess how the various players would react to the opening story, map out what resulting scenarios could develop and where deadlocks are possible. Preparing this flow chart of possible developments enables us to anticipate in advance where we may have to intervene if necessary. Few minutes after we started the simulation - surprise The opening story included an agreement signed between some of the players. We prepared the agreement for several days with the active support of experts on the subject. We were sure that this agreement would make one of the players act quickly and decisively, after selecting between two main alternative responses. In our flow chart we examined how the simulation could develop if either alternative was selected. But, while everyone was waiting for this player's decision, he decided to make a completely unexpected move. He did this after he read the agreement and found that it opened for him a third alternative which he preferred. We, who prepared the agreement, did not anticipate this third alternative. Bingo! Just for such developments it is advisable to use simulations. Simulation goes beyond the regular frameworks of decision making. There is no senior person who runs the discussion and uses his seniority to influence its outcomes. Managers are required to "get into the skin" of parties outside their organization. Often, a degree of competition develops between the various players. In this way simulation increases the likelihood of presenting options and scenarios that would typically not be presented during "regular" meetings – which is exactly what happened in this simulation.
  5. 5. 5 The creativity of the team that acted as the major player found a different and innovative direction. Following this, the debriefing meeting at after the simulation itself raised very innovative and useful insights about the practices recommended in a "real" situation.

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