Management Virtualization Technologies

As a rule, when creating or launching a new product, first try to test it in conditions close to the fighting. So, in the work of the system administrator, instead of deploying any system on a running server, first there is a run-in on the test bench, where the features and nuances of the system, as well as possible options for rolling back to its original state are found. But this option is almost impossible when it comes to business management. Hardly anyone will spend money on the creation of an enterprise in order to learn how to manage such a test enterprise, and then, after finding out possible problems, to create an enterprise that will work without failures. Yes, and it will take much more time than raising a test server.

However, the initial experience and management skills of the company to acquire somewhere you need, and it is desirable that without dire consequences. One of these options, so to speak, for "training on cats" is to use a business simulator. In this topic, I would like to briefly describe one of the most popular business simulators - a simulator on the Global Management Challenge project, in which we were able to participate.


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“The action program carries risks and costs, but they are much less than the long-term risks and costs that convenient inaction can lead to”

Intro

Since 2008, according to the statistics of search queries and the popularity of discussions in the blogosphere in the Russian segment of the Internet, the popularity of such queries as “innovation”, “startup”, “small business” has increased from 3 to 5 times.


Pulse of the blogosphere for innovation, start-up and small business requests

On Habré often featured articles about startups. Unfortunately, on average, no more than 10% of startups live to a state of financial maturity. There are various reasons for this. You can, based on the first available link , list the most popular ones:
• Lack of experience;
• Lack of funds;
• Insufficient sales volumes;
• High operating costs;
• Inability to compete;
• Bad location;
• Lack of a plan or goals;
• Lack of self-esteem;
• Unjustified cash flow;
• Withdrawal of money from the business;
• In case of non-professional bookkeeping;
• Too high receivables;
• High overstocking;
• Too high investment in fixed assets;
• Unqualified staff.
Most of the above relates to management problems (management). Since the creation of innovations implies the availability of knowledge in areas close to the technical direction, there are often situations when creating your own enterprise with a good (almost realized) idea, but without knowledge in the field of management (general, strategic, financial, personnel, etc.) ), after a while it turns out that the company died in a cradle.

If, however, it is trite to refer only to the theory, then it will be necessary to read and try to understand the following sources:
General management;
Financial management;
Personnel Management;
Strategic management, etc., each of which draws a minimum of pages of 500 soporific text. But a theory without practice still will not give anything except a general understanding of terminology in this area of ​​knowledge.

The best option, so to speak, for “training on cats” is to use a business simulator to understand how a company is managed, except for the difference in the product produced or the service provided, all other fundamental processes in all In general, enterprises are similar: financial management is subject to tax legislation, personnel management is subject to the labor code, etc ...
The most popular business simulator is a simulator on the Global Management Challenge project, constantly being improved at the Operational Research Department of the University of Strathclyde in Scotland. In Russia, he is represented by the project Open Championship in the management of the company ( Global Management Challenge ) and in a somewhat simplified form in the Business Battle .
It is clear that in Moscow this simulator has been known for a long time and quite well, but still, I want to share my impressions on behalf of the participants who are also Habr's residents who have reached the final of the Russian Championship.

A few words about the format of the championship

The game model is a simulator of the company in the FMCG market (consumer goods), competing with other companies in the global Internet markets, Russia and the EU. In essence, this is a unique “simulator” that trains managers and project teams to work in competitive markets according to international management standards.

Rules of participation

The teams participating in GMC Russia are divided into groups of 4-8 teams.
Each group is a local market where teams compete directly with each other.
Each round of the Championship consists of 5 periods: five consecutive decision-making tacts.
The teams with the highest share price in their groups for the 5th period will go to the next round.

What you need to do

Create a team of (3-5 people) and register it on the website www.globalmanager.ru
Wait for the start of test rounds or the official start of the championship.
Download the history of your virtual company and develop its development strategy for 1 year and 3 months.
Analyze management reports and make decisions in production, marketing, finance and personnel management.

And now a little more

How does the GMC

GMC virtual company model:

Participants become top managers of virtual companies.
"In your company there are several departments for the management of which you
answer:
• The marketing department analyzes the market to prepare a forecast of likely
• sales.
• The production department is responsible for the release and shipment for the implementation
• the required number of products, and also controls the availability of
• labor and production resources.
• The Human Resources Department regulates salaries and is responsible for
• working conditions of company employees.
• The finance department controls the process as a whole and is responsible for the profitability
• Companies and the effective use of the resources available to them.
Each department must retain the company's long-term strategic goal and
to work towards its achievement. ”(Manual GMC).
In the first stage, you get the history of the company in the form of management reports for the five quarters. Each quarter represents 12 weeks.
The team will need to analyze reports that are in some way
accounting and management reporting describing the state of the company, the actions of competing teams (their costs for advertising, for development, prices for products, the value of their assets, etc.) and changes in the situation on international financial markets.
Management reports show what decisions were made and how they influenced the current situation. According to the history of the company, a preliminary strategy is being built; some parameters for its calculation model are being clarified.
Next, you need to make 66 management decisions every week. What prices to set, how to change R & D financing, what will be the cost of advertising, how much to produce, etc., to answer these questions, you must try to make predictions, how the market behaves, competitors create a calculation model for this.
With each decision making, you receive a management report - the results of your decision and decisions of the opposing teams.
Based on their initial forecasts and what came in the management report, conclusions are drawn on how accurately the computational model works. Further, errors and inaccuracies in their computational model are clarified and corrected. And so, step by step, with each decision making, calculations become more accurate and more accurate. But do not forget about the main strategy! Indeed, even with a very accurate computational model, an erroneous strategy may not lead to the best result.

Companies operate in conditions close to real ones .
The teams compete with each other for 5 quarters in the simulator (5 decision making = 5 weeks in real life) - the winner is determined by the price of the shares.


The first sheet of the management report


The second sheet of the management report

Own impressions

The instruction to the game seemed to be very valuable, where on 80 pages the knowledge contained in 500 page folios with soporific contents, which were discussed above, was archived.
Based on the instructions, you will need to develop your own model that describes the behavior of the simulator. At the first stage, this is the most resource-demanding activity (both in time and laboriousness), but in the future it will all pay off and decision-making will take place in one day. We, like all other participants, created our own model of the game based on the functionality of Microsoft Excel 2007. Some excerpts from which can be found on the links:
Tab of the model for decision making ;
Tab of the model, helping to predict demand .

Participation in GMC makes it possible in a short time to master the basics of what is vital for a manager. To test knowledge in practice, to estimate how much all the main parameters when making management decisions are interrelated with each other. This gives a completely different perception from textbooks.

So, for example, the dynamics of the stock price in our subgroup looked like:


In terms of stock value at the end of the game round, the team goes to the next round of the game. We managed to reach the final of the Russian Championship, which is traditionally held in Moscow at the President Hotel.





The winner of the Russian stage goes to the international final. This year the international final was held in Russia in the city of Khanty-Mansiysk, because last year the Russian team won the international super final. This year the team from Russia took the 3rd place. The Ukrainian team won this year.
The results of the international super final 2010:
1 place. Ukraine - 1.843
2nd place. Finland - 1.825
3rd place. RUSSIA - 1.817
4th place. Hong Kong - 1.779
5th place. Turkey - 1.740
6th place. China - 1.733
7th place. Macau - 1.720
8th place. Germany - 1.587
By the way, there were Chinese in the Finnish team. Therefore, we can say that half of the participants in the international super final are Chinese, which is not surprising, given the performance of their economy as a whole.

You can watch a video report from the international finals of this year.

Outro

For a successful performance at this championship, it is not at all necessary to study for a manager or an economist, or to work in a managerial position in a large company. The winner of past years is studying in the magistracy in the direction of business informatics.

The main purpose of this article is the desire to interest in participating in such events. The main thing is that these “funny battles” lead to the emergence of truly successful Russian companies that compete on the world market. After all, it is not by chance that teams from China have been participating in this championship for a number of years and have become winners of the international super final 6 times ...

PS I would like to thank vikds and lena_sakhno without them participating in the GMC and this article would hardly have succeeded.

UPDATE1: To participate in the Global Management Challenge tournament, you must pay the organization fee in the amount of 40 to 50 tyr (depending on the conditions of participation). There is a possibility of participation for free or with a significant discount, provided that your team’s test rounds are completed with the best result.

UPDATE2: To participate in the in-person Global Management Challenge round, you need a team of at least 3 and no more than 5 people. Fewer participants can participate in the test tours.

UPDATE3: For participation in Business Battle registration fee is not required, but there are restrictions to the participants - these must be university students who have entered the study no later than a certain year. And access to the international finals in Business Battle is not provided.