A Large-Scale Game Test of Early-Determined Game Finishes Page 177 - Developments in Business Simulation and Experiential Learning, volume 40, 2013 ABSTRACT Teach and Patel (2007) reported that teams playing CAPSTONE (Smith, n.d.) arrived at their final financial standings early in the game. A recent replication effort could not repeat their results. The effort, however, obtained mixed results when applied to a large game. This paper examines the same large game under conditions that recognize the longer decision time horizons and investment costs associated with such games. Under these considerations the early-determined finishes thesis for first and last place firms was not supported on either a cumulative or round-by-round profits basis. INTRODUCTION An important part of Teach and Patel’s 2007 ABSEL paper observed that the majority of their CAPSTONE (CAP, Smith, n.d.) companies took and retained their industry’s lead in accumulated profits after three playing rounds. Additionally, they found that many of their companies fell to their industry’s bottom rank and stayed there after only three rounds of play. Based on these events for each industry’s biggest winners and losers, it was concluded many players could feel the game they were playing was unfair while frustrating the accomplishment of course-related learning objectives. A direct replication effort by Wolfe, Biggs & Gold (In press), however, refuted the early finish thesis using a census of 1,164 CAPSTONE companies. Partial or mixed support of the early finish thesis was found, conversely, for the large game that was studied with a small sample replication. This paper repeats the large game study using a relatively large sample of 142 teams playing The Global Business Game, World Edition (GBW, Wolfe, n.d.) for a longer series of decision rounds. It was believed such an effort should be undertaken given the GBW’s greater complexity, larger industry sizes and longer-term capital development efforts required versus CAPSTONE’s relative simplicity, restricted industry size and shorter time horizons. In CAPSTONE’s case a maximum of 75 decisions are possible. A reference to this paper’s Appendix indicates a GBW round could entail between 24- 326 decisions depending on the team’s strategic initiatives and tactical applications. LARGE-SCALE GAME STUDY Two papers have been previously presented at ABSEL dealing with either a company’s early dominance of its industry, or of early first and last-place finishes. Bernard & de Souza (2009) investigated the early dominance phenomenon using two online games played synchronously (SIND, 2006; SIMCO, 2008) for 7-8 rounds. Although their study defined dominance in the form of the company’s stock price, their findings supported Teach and Patel’s early standings thesis. A year later Biggs and Fritzsche (2010) did a similar study using the larger-scale Business Policy Game (Cotter & Fritzsche, n.d.) to investigate Teach & Patel findings. Their study could not repeat those results although they truncated to eight rounds their 20-round playing conditions to emulate the eight rounds used in CAPSTONE. Given this qualification that study’s structure, at this point the results are mixed or cloudy regarding whether the early finish observation by Teach & Patel is correct when applied to large games. This paper retains the presentational form used by Teach and Patel to lend continuity to this research stream. Their effort examined the economic performances of team- based companies in 41 industries playing eight decision rounds. Results were recorded on both a cumulative and round-by-round basis. This paper’s study obtained a census of 19 GBW industries comprised of 15 seven-firm industries and 4 eight-firm industries. Student teams were business school students enrolled in an international business degree program at a AACSB accredited West European public university. Six to seven members were randomly assigned to their companies through the university’s enrollment process. Course-related grade assignments were made by a combination of a game knowledge examination, a team participation grade and the company’s economic performance, mainly in the form of its profitability. CUMULATIVE PROFITS TEST Teach and Patel’s first test looked at a company’s profits to determine in which round it arrived at its ending rank. For this paper’s study, the following hypothesis was tested, with “early in the game” defined as by or before four rounds of play in a 10 decision round game. H1 The majority of firms will arrive at their industry’s ultimate first-place finish early in the game. Exhibit 1 shows the percentage of firms arriving at their sustained first place finish on a cumulative profit basis. Exhibit 2 presents these results differently. It indicates at the end of which period the majority of the finishes had been determined. In this exhibit it took five rounds of play before a slight majority of all companies had arrived at their first-place finish. Also, by the game’s eighth period 5.3% of the first-place companies had not arrived in A Large-Scale Game Test of Early-Determined Game Finishes Joseph Wolfe Experiential Adventures LLC Jwolfe8125@aol.com Page 178 - Developments in Business Simulation and Experiential Learning, volume 40, 2013 first place. On this basis the hypothesis regarding an early- determined first-place finish, based on cumulative profits, was rejected. Teach & Patel also examined when their firm’s arrived at their last place finish. Their hypothesis regarding last- place arrivals can be thus stated. H2 The majority of firms will arrive at their industry’s ultimate last-place finish early in the game. Exhibits 3-4 indicate this hypothesis must also be rejected on a cumulative profit basis. As was the case for first-place arrivals, the majority of last place firms had not arrive at their industry’s lowest rank until after the fifth round. ROUND-BY-ROUND PROFITS TEST Teach and Patel next turned their attention to a firm’s ranking on a round-by-round basis. Under this approach they compared the number of times a firm was in first place vs. the number of times it was in other places. By way of Richard Teach’s courtesy, Wolfe, Biggs & Gold (In press) was provided his study’s raw data. Because of this the presentation used in this, and the Teach/Patel paper’s first section, can be repeated here in bar chart form rather than in their original tables. This also lends continuity to the presentations made in this paper. For the early finish hypothesis to be accepted more than fifty percent of the ending finishes would have to have occurred by the game’s fourth round. Exhibit 5 shows the percent of times a team that finished first was in first place on a round by round basis. This exhibit, and Exhibit 6 shows that it was not until after the game’s ninth period that its winning team’s position had been secured. It is also notable that 26.3% of the eventual first-place firms could not be considered the industry’s overall earning “winner” until after the game’s last decision round. Exhibits 7-8 indicate the early finish hypothesis for last-place companies must also be rejected. Most interestingly in this case, it was only until after the game’s ninth round that the majority of firms were in their final last places. Moreover, it was not until the game’s Exhibit 1 First-Place End-Game Arrival Round by Cumulative Rank 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 1 2 3 4 5 6 7 8 9 10 Round P e rc e n t o f S u st a in e d F ir st -P la c e F in is h e s Exhibit 2 First-Place Finish Probabilities by Cumulative Rank Page 179 - Developments in Business Simulation and Experiential Learning, volume 40, 2013 final period that the industry’s remaining 36.8% of the firms knew their finishes. DISCUSSION While the Teach/Patel paper emphasized end-states in their extreme forms of first and last places, in a real competition, as in the industrial real world, there are all manners of in between positions. Some firms are in unassailable first places. Others may be second-place companies that are dramatically improving their performances while bottom tier companies could be trying to implement turnaround strategies that might improve their profit rankings. As an example of the amount of turbulence involved, Exhibit 9 shows that the majority of the sample’s four middle-ranked companies did not arrive at their sustained finishing rank until after the seventh or eighth periods of play. Therefore there had to be many changes in ranks for most of each game’s duration. Another way to see this, for middle-ranked firms, would be to look at how often each firm resided in its final ranked position. Exhibit 10 shows that the average third- ranked found itself 26.3% of the time as a third-ranked company. The exhibit also shows that the average sixth- ranked company was in that rank only 8.9% of the time, and 91.1% of the time it was not in sixth place. The fact that the game’s companies were often in different ranks by quarters indicates the irregularity of their profit paths. Moreover, the ranges of their profits had to be very wide. This width accordingly provided much leeway for their relative placements within each quarter, and throughout the game. As shown in Exhibit 11, for this study’s third-place companies, the average company lost for the game’s first four quarters. Simultaneously a few firms actually made a profit in quarters 2-4. Thereafter, the average third-ranked company made money but these profits had wide ranges. In the game’s last quarter profits ranged between $11.2 - $40.5 millions. Although this study did not find support of Teach and Patel’s early-determined finishes, it should be recognized there is a relationship between a firm’s early standings and its ultimate placement. Exhibit 12 displays the Spearman rank order correlation coefficients for the all firms on a Exhibit 3 Last-Place End-Game Arrival Round by Cumulative Rank 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 1 2 3 4 5 6 7 8 9 10 Round P e rc e n t o f S u st a in e d L a st -P la c e F in is h e s Exhibit 4 Last-Place End-Game Arrival Round by Cumulative Rank Page 180 - Developments in Business Simulation and Experiential Learning, volume 40, 2013 quarterly basis. When using cumulative earnings as the firm’s performance measure about 54.8% of the variance in a firm’s finishing rank could be explained by the end of its fifth quarter of play. If a quarter’s profit ranking was used to judge where a firm may find itself at the game’s ending, 72.3% of the finishes could be explained at the end of the sixth quarter. Note however, that after this quarter the amount of variance explained falls off so that less can be explained about the firm’s finish in the tenth quarter than could be explained in the previous four quarters. Despite the amount of variance that can be explained later in the game, it is believed, especially when round-by- round profits are considered, that not enough could be known by game’s players about their finishing rank to affect their willingness to play. The perceptions of what could be accomplished by a team of players, however, could be dependent on the locus of control (Rotter, 1954) possessed by its decision makers. Some could believe their fate is no longer in their hands and the glass is half-empty. Others may believe the glass is half full and that their fate is in their own hands as found in a game-based study (Wolfe, 1996). CONCLUSION Evidence has been presented here and elsewhere that the early-finish observations by Teach and Patel have not been repeated. A company’s early ranked economic performance, when charted either on a cumulative profit basis, or a round by round profit basis, does not accurately reflect or predict its final placement. Depending on a company’s attitudes, as well as those of the instructor, some teams may think their competition is over with based on their early game performance, whether those performances are better or worse than their competitors. Exhibit 5 Round-by-Round Ranks for Final First-Place Firms 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 1 2 3 4 5 6 7 8 9 10 Round Rank P e rc e n t o f S u st a in e d F ir st P la c e F in is h e s Exhibit 6 First-Place Finishes Determined by Round Page 181 - Developments in Business Simulation and Experiential Learning, volume 40, 2013 Given the variance in the paths by which firms find their finishing state to be, there is ample opportunity for a team to improve upon their results, or to fail if it begins to pay less attention to the business of running their company. This means that there are numerous and different learning opportunities available throughout a game’s life course. Because of the discrepant findings between the observations by Teach and Patel and those of others, an examination is warranted for them to investigate what in the learning environment they created led to what now appears to be unique results. Additional research should been conducted on other games, both large and small, to see if the Teach and Patel findings can be repeated. It is possible that the results produced in the current study are the ones that are unique rather than being the opposite. REFERENCES Bernard, R.S., & de Souza, M.P. (2009). Dominance in Online Business Game Competitions. Developments in Business Simulation and Experiential Learning, 36, 287-290. (Reprinted Bernie Keys Library (10th ed.)). Biggs, W.D., & Fritzsche, D.J. (2010). Using Accumulated Profits to Assess Performance in Simulations. Developments in Business Simulation and Experiential Learning, 37, 183-189. (Reprinted Bernie Keys Library (10th ed.)).. Cotter, R., & Fritzsche, D.J. (n.d.). Business policy game: An international strategy simulation. Available from www.eskimo.com/~fritzsch/game/bpg.html. Rotter, J.B. (1954). Social learning and clinical psychology. NY: Prentice-Hall. Exhibit 7 Round-by-Round Ranks for Final Last-Place Firms 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 1 2 3 4 5 6 7 8 9 10 Round Rank P e rc e n t o f S u st a in e d L a st P lc e F in is h e s Exhibit 8 Last-Place Finishes Determined by Round Page 182 - Developments in Business Simulation and Experiential Learning, volume 40, 2013 SIMCO (2008). Retailing simulation. Florianópolis, Brazil: Bernard Sistemas. www.bernard.com.br SIND (2006). Manufacturing simulation. Florianópolis, Brazil: Bernard Sistemas. www.bernard.com.br Smith, D. (n.d.). CAPSTONE. Available from http:// www.capsim.com. Teach, R., & Patel, V. (2007). Assessing Participant Learning in a Business Simulation. Developments in Business Simulation and Experiential Learning, 34, 76 -84. (Reprinted Bernie Keys Library (10th ed.)). Wolfe, J. (n.d). The global business game, World edition. Available from http://www.onlinegbg.com Wolfe, J. (1993). A history of business games in English- speaking and post-socialist countries: The Origination and diffusion of a management education and development technology. Simulation & Gaming, 24(4): 446-463. Wolfe, J. (1996). CEO strategic locus of control effects on game performance and playing behavior. Developments in Business Simulation and Experiential Learning, 23, 81-87. (Reprinted Bernie Keys Library (12th ed.)). Wolfe, J. & Crookall, D. (1998). Developing a scientific knowledge of simulation/gaming. Simulation & Gaming, 29(1): 7-19. Wolfe, J., Biggs, W.D., & Gold, S.C. (In press). A replication and expansion of Teach and Patel’s discovery of early-determined endgame finishes. Simulation & Gaming. Exhibit 9 Mid-Ranked Firm-Finish Arrival Round— Cumulative Ranks Exhibit 10 Frequency in Ending Rank http://www.onlinegbg.com/ Page 183 - Developments in Business Simulation and Experiential Learning, volume 40, 2013 Exhibit 11 Earnings Ranges and Profit Paths for Third-Place Firms -$10,000,000 $0 $10,000,000 $20,000,000 $30,000,000 $40,000,000 $50,000,000 1 2 3 4 5 6 7 8 9 10 Round P ro fi t Exhibit 12 Spearman Correlation Coefficients by Round Page 184 - Developments in Business Simulation and Experiential Learning, volume 40, 2013 APPENDIX BUSINESS GAME TEACHING/LEARNING ELEMENTS Descriptor GBW Number of products Two but tailored by quality levels for the country markets served. Product type(s) 25” and 27” television sets Home country Can be the United States, Mexico, Germany, Spain, Japan or Thailand. Active subsidiaries One in the Home Country plus the addition of up to five more. Factories Up to six Factory operations Two shifts plus Saturday overtime Factory maintenance Yes— By factory and by three types of technologies in each factory Factory options Build new, expand, contract, decommission, liquidate or transfer all to other operating units. Can also sell off capacity and subcontract output as a strategic alliance. Quality Control Two simultaneous types of programs. Research and Devel- opment Product development resulting in patentable features with additional slight process benefits. Factory workers Experienced and inexperienced with different salaries and training needs scheduled by shift and product. Factory foreman Yes— By coverage required in each country. Robotics Two types plus attending technicians. Raw materials Six—Advance ordering of two major groups with three quality levels in each group. Capacity options 18 possibilities— Assembly line capacity and two types of robots within each factory. Funds transfers Yes Sales promotion Budgeted by country markets and products. Fluctuating exchange rates Yes Sales offices Yes— Options to start-up and shut-down multiple sales offices in each country Sales force Country assignments, quits, hiring, firing, training budget, base salaries and commission rates Employee training Factory workers, sales representatives and robotic technicians Distribution Centers Yes Wholesalers Two types Bonds Yes— With mandatory quarterly payments. Bond calls possible. Stocks Yes— With possible dividends and Treasury Stock purchases. Short-term loans 90-day loan Short-term invest- ments Yes Minimum decisions 24 Maximum decisions 326 Research Reports Twelve covering actual unit sales, one-quarter sales forecasts, advertising budgets, quality levels and sales force compensations by products and countries. Companies per in- dustry 3-9 Computer-generated events 12 Critical Incidents Strategic alliances Yes—Patent licenses, capacity sales/purchases and subcontracting Computer role Online server Decision support materials Built-in Pro forma Income Statements and Pro forma Cash Flow Report and auxiliary spread- sheets for production scheduling, raw materials purchases and currency translations. Table of Contents Volume 40, 2013 Leo Investor SERIOUS PLAY: ON-LINE PEPULATOR SERIOUS PLAY:ON-LINE GAME "MANAGE-ART" The Game Within the Simulation Game the Research Method Concept and Project With Game Design Implementation Managing Human Resources Simulation Rising Stars: A Study of Creativity as Experiental Learning in County Government Why do Gen Y Students Study Abroad? The Relationship Between Individual Growth and the Intent to Study Abroad Our Favorite Assignment: The In-Basket Activity Mirror-Mirror: How Can We Better Understand Our Consumption Behavior? Reflective Thinking, Writing and Imagery as Tools to Better Understand Abstract Marketing Concepts Increasing Intuitive Decision Making Speed and Accuracy by Further Understanding Intuitive Decision Making Using Emotional Means Group Exams: Are they Relevant and Reliable as a learning Tool? Integrative Learning: Exploring Opportunities in Business Simulations Simulated Tabletop Exercise for Risk Management - Anti Bio-Terrorism Multi Scenario Simulated Tabletop Exercise Simulated Tabletop Exercise for Electric Power Saving Management in a Small Organization Merging the Case Method and Simulation in Management Education: Is it Possible? Experiential Learning in Accelerated Human Resource Management Courses Digital Game Building as Assessment: A Study of Secondary Students' Experience Using an Investment Fund Simulation Integrated with a Business Game Creating Simulation Conditions Based On Real World Data Simulation Games in Training New Management Methods A Summary Overview of Cultural Differences in Higher Education Innovations And Future Directions In Education: Case Review For Best Online Teaching Practices An Implicit Measure of Forecasting Accuracy Immediate Feedback and Assessment Technique (IF-AT) testing forms: An overview of the tool and uses Teaching Secondary Mathematics: Pre-service Teachers' Digital Game Design, Pedagogy and 21st Century Skills Follow The Leader II Business Simulations: From Punch Cards to Web-Based University Engagement: Good Neighbors Budget Allocation Exercise Customizing Business Simulations: An Exploration and a Hierarchy A Review of the Simulation Research in the Academy of Management Journal: Suggestions for Strengthening the Research Conducted by ABSEL Members ABSEL Reflections: 40 Years Of Excellence, Now Going Forward How Many Options do Multiple-Choice Questions Really Have? The Management/Accounting Simulation Now 100% Web-based Design, Server Side Programming, and Implementation A Large-Scale Game Test of Early-Determined Game Finishes Large-Scale Business Games for Assurance of Learning Purposes The Gamification Of Education OB Simulation: A Hands-On Demonstration Converting Simulations for the Online Environment: The New Ginseng Game Repositioning Brands with the Web-Based Product Positioning Map Graphics Package Implications of Regulatory Focus Theory for Simulation and Experiential Learning Riskware: A Game for Teaching Software Project Risk Management Teamwork for Decision-Making Through Games: The Case of On-Line "Manage-Art" Virtual Pepulator, a Model for Teaching Negotiation Small-Scale Business Games for Assurance of Learning Purposes Incorporating Intellectual Property Issues into a Business Simulation© Nationalization and Privatization in a Computer-Assisted Business Game An Investigation of the Relationship of Plan Quality, Forecast Accuracy and Earnings Performance Under Equal and Unequal Starting Positions in Marketing Positions in Marketing Simulations Measuring the Performance Ranking Curve in Marketing Simulation Games The Effectiveness of SDM Method in Business Simulation Game 40 years of Brazilian S&G - Analysis and Perspectives Accounting For Externalities: Harnessing The "Face-In-The-Mirror" Phenomenon The Role Of Simulations In Organizational Learning: Building Individual Absorptive Capacity Assessing Project Management as an Academic Learning Outcome (ALO) At the Inflection Point: Designing Army Assessments "Economics in Practice" A Simulation Game for High School Students Teaching the Basics of Economics and Entrepreneurship Fueling the Force: Exploring Leader Priorities Implementing Mental Models: Extending Insight and Whole Person Learning Using Business Simulations To Introduce Business Concepts