ENTERPRISE: A MULTI-PURPOSE MANAGEMENT SIMULATION Developments in Business Simulation & Experiential Exercises, Volume 13, 1986 155 ENTERPRISE: A MULTI-PURPOSE MANAGEMENT SIMULATION Peggy A. Golden, University of Louisville ABSTRACT Enterprise 111 is a personal computer-based management simulation that was developed for the Introduction to Business student. In its simplest use, the decision set requires minimal conceptual and quantitative skills. However, the player’s manual, instructor’s guide, and administrator’s report expand the sophistication of the simulation making it appropriate for courses in Small Business Management and Principle’s of Management. INTRODUCTION Enterprise is a computer simulation game that was targeted at the “Introduction to Business” segment of the business school market. In its developmental stage, the game and player’s manual followed the table of contents of appropriate textbooks for these classes. Therefore, the play of the game addresses such issues as legal structures of business, the environment, marketing strategies, planning and organizing, human resources, and general. concepts of accounting and budgeting. The student manual is somewhat more elaborate than usual with twelve (12) chapters covering, in brief, topics that compare with the Table of Contents of most Introduction to J3usi- ness textbooks. Each chapter concludes with a set of student exercises that provide the start-up decisions for the simulated company. As an evolutionary concept, however, the game acquired characteristics that might be embodied in the small business management and principles of management curricula. For example, players are required to do site selection, develop a financing package, select a product line, manage human resources, and demonstrate social responsibility. Thus, by way of Introduction, one might conclude that it has applicability to many courses in the academic and training environments. Description Enterprise is a personal computer-based simulation written for the Apple TI-Plus series and the IBM-PC and its compatibles. It can be used with a minimal configuration consisting of system unit, 40-character display, one disk drive, and printer. From the user perspective, Enterprise involves a one-time initialization and creation of a decision- set file for each period of play. Students start up and operate a “jeans and top” store in a location of their choice. The student team can select the quality level of the merchandise (inexpensive, Western leans, or premium brand designer leans). An equivalent line of tops is also available for sale. In addition to inventory, students car’ select the caliber of staff as well as specify hours of operation. Each period is accompanied by a mini- case incident that challenges the social responsibility of the student to their various “publics.” The instructor has the ability to manipulate the impact of key variables including overhead items, demand, and variable cost of goods sold. The output includes a student report for each team, a recap of decisions, and a “buyout” index that indicates the favorability of purchase of the operation by a third party. The simulation is interactive with the instructor but processes the data as a batch file created by an input program. Although this emulates mainframe batch activity, the personal computer has created a level of control over the processing of the game that was not possible in the traditional data processing environment. (E.g., drop the cards at the computer center and pick up printouts 24-28 later.) The control feature is enhanced by an administrator’s report that is published before the student reports. A review of this report permits adjustments to student decisions or instructors parameters prior to the printing of the final student reports. The flowchart in Figure 1 shows the processing of the entire simulation. Decision Set and Reported Information The student decision set consists of sixteen variables that reflect a. Inventory b. Marketing strategies c. Staffing d. Marketing research e. Financial decisions f. Ethical and social responsibility considerations Developments in Business Simulation & Experiential Exercises, Volume 13, 1986 156 The student report contains a profit and loss statement calculated on a cash-accounting basis, and decision-support information (see Figure 2) including: a. Economic index b. Market research as purchased c. Exception reporting regarding staffing and Inventory levels d. Inventory and cash management information e. A discretionary instructor’s message f. Response to a mini-case included In each decision set dealing with social responsibility. A unique feature of this simulation is the “incident” or mini- case feature that encourages discussion of real issues facing the entrepreneur. The example shown below in Figure 2 is discussed by the student team and their choice number is entered on the student decision form. The incidents have stimulated student teams to institute personnel practices, spruce up their community image, and become sensitive to the capriciousness of the business environment. Using Enterprise In “Introduction to Business” As mentioned earlier, Enterprise was developed to provide an experiential ]earning exercise for Introduction to Business. This intention is reflected in the structure of the player’s manual. For this survey course, the manual can be used on a chapter- by-chapter basis; in this case, the exercises at the end of each chapter become the start-up decisions for the simulation. For example, the completion of the exercises at the end of the chapter on marketing, the student have an opportunity to evaluate push versus pull marketing variables and can develop a marketing plan for their simulated store. The general flow would involve slow entry into the simulated environment and play of the game for the second half of a semester. Another method of use for the Introduction to Business student is the play of the game as a capstone experience. In this approach, the instructor creates a homogeneous industry (provided in the instructor’s manual) and the students use their start-up experience to order inventory and develop a simple pro forma expense statement. Either option should allow for 6-8 quarters of play to optimize the learning involved. When Enterprise is used in this environment, the game is played with all parameters set at constant values throughout the course of the simulation. This will provide predictable outcomes when students become aware of the patterns; however, the players are still required to perform simple analyses to insure that they are socially responsible, have enough staff, cash, and inventory, and can respond to the environment of business. The game administrator can thwart violation of the simulation from semester to semester by changing the relationships through the use of parameters. Using Enterprise In Small Business Management Because the simulated business is a small retail operation, Enterprise lends itself to use in a Small Business Management course. Peripheral features including construction of the players manual and optional reports are available to increase the sophistication of the game. For example, the instructor’s parameter feature permits change in the simulated environment of the business. In addition, a scoring report provides an acquisition index of attractiveness of the business, industry averages of selected ratios, and company-by-company ratios. The report provides enough environmental and internal information to encourage forecasting and facilitate the formalizations of policies and procedures so often overlooked by small business managers. Conclusion Enterprise has the flexibility to provide experiential learning in diverse environments. The apparent simplicity of play can be manipulated by use of the player’s manual, Instructor’s manual, and alteration of baseline relationships in the simulation itself. Its uniqueness issues from the familiarity that students have with the operational media and their ability to develop a world around the simulated environment. REFERENCES [1] Smith, J.R. and P.A. Golden, Enterprise: A Simulation, Boston: Houghton-Mifflin, 1985. Table of Contents Volume 13, 1986 How to Use Microcomputers in Human Resource Management Courses What's My Line? An Exercise in Job Analysis, Description and Classification Relationships Between Team Cohesion Dimensions and Business Game Performance Four Factors Affecting Group Performance in Business Policy Simulations Enhancing Strategic Management Goal-Setting Skills in the Business Policy Course Using a Business Simulation in the Principles of Management Course - Learning Outcomes and Perceptions Personal Computers: Drexel's Experience Using Psychological Type to Enhance Negotiation Skills The Effects of Conflict Handling Styles on Negotiation Behavior: An Analysis of an Experiential Exercise An Experiential Test of Bargaining Decisions and Representation Self-Grading of Examination by Students, A Viable Alternative to Traditional Procedures Perceived Instructor Enthusiasm and Student Achievement An Experiential Approach to Teaching Subordinate-Oriented Communication Assessing the Effects of a Computerized Study Guide in Macroeconomic Principles: A Statistical Analysis A Sales Management Simulation for the PC an Integrative Tool for the Sales Management Course Teaching Re-evaluation of Salespersons Through the Use of a Simulation Game A Test of Student Performance and Attitudes and Performance Under Varying Game Conditions Developing and Testing Airways: A Marketing Simulation Experiential Learning Revisited: Some Thoughts on Designing More Adaptive Management Education Programs Developing the Competencies of Creativity and Accurate Self-Assessment Self-View and Norms: Some Longitudinal Laboratory Results Strategic Planning with an Experiential Case The ABSEL Research Consortium: Preliminary Steps and Position Papers An Analysis of ABSEL Conference papers (1974-1985) The Creation and Operation of a Data-base System for ABSEL Research Funding for a Research Consortium on Simulation and Experiential Learning Simulation - Indoctrination or Learning The Dilemma In Evaluating Classroom Innovations Personality Variables on Group Cohesion, Team Participation and Total Learning Justifications for and Problems in Developing and Using Computerized Experiential Activities Management Competency Models and the Life-Long Learning Project: What Role for ABSEL External Validity of Business Games Restructuring the University - An Experiential Exercise The Surrogate Class Exercise Images of Effectiveness: A Classroom Exercise The Algebran Industry: A Tutorial Framework Another Chance: A Multi-Leveled, Macro Business Game for Micro-Computers A Water Quality Management Simulation Game Acquisitions? Divestitures? Progress Report on a Conglomerate Game Enterprise: A Multi-Purpose Management Development Simulation Marketer: A Microcomputer Simulation in a High Tech Industry A Pedagogical Analysis of Alternative Tax Elections for Exploration Costs in the Mining Industry Using of Multiple Microcomputers Application Programs to Teach Fundamental Business Concepts and Practices Demonstrating the Role of Simulation in Strategic Operations Planning: A Case Study in Bank Check Processing Location Analysis The Subjective Side of the Decision Support System: A Pitfall for the Panacea A Group-Based Procedure for Revealing Judgmental Heuristics and Biases An Experiential Exercise in Bayesian Decision-Making Values for Selected Parameters in Physical Distribution Simulation and Games Computerized Business Management Simulations for Tyros The Management Decision Laboratory at New York University An Example: The Use of Management Games on Microcomputers by Computer Novices Enhancing Mainframe Simulation Via Microcomputers: Designing Decision Support Systems Integrating Personal Computers Into a Course as a Decision Support Tool A Decision Support System for Capital Funds Forecasting Performance and Attitudinal Affects of a Decision Support Package in a Business Game Using the Real World: Interviews with Woman Mangers The Cooperatively-Authored Student Handbook International Buying: An Experiential Exercise The Research/Teaching Interface: Turning a Pretest into an Experiential Exercise Building Microcomputer Business Simulations Simulation with Discrete and Continuous Mathematical Modeling An Interpolation Approach to Developing mathematical Functions for Business Simulations The Design of Simulation Models Using Thought Organizers The Assessment Center as a Teaching/Learning Device An Approach to Meeting the AACSB Guidelines for Introducing Skills and Personal Characteristics (SACs) Using an Interclass Simulating and Role-Playing Pedagogy Experiential Learning about the World of Work: A Program for Primary and Secondary School Educators Assessment of Relevant Personal Characteristics of Potential Entrepreneurs