Frequently Asked Questions
GENERAL | MODEL-ORIENTED
In what university courses would you run INTOPIA?
The obvious use of INTOPIA is in courses (and executive programs) in international business and in capstone business policy and strategy courses. All classic business disciplines are amply represented. For instance, the simulation is frequently used in general marketing management courses. Specifically designed to include relationship marketing, e.g., between component (default: microchip) and end product (default: PC) manufacturers, or between manufacturers and wholesalers, a business-to-business marketing course around it is another natural application--as would be a course on negotiation and networking. At Thunderbird Graduate School of International Management, INTOPIA has been the core of a course on international manufacturing and logistics. In time, users will predictably adopt it for international finance programs and courses. As participants are continually faced with a stream of entrepreneurial opportunities, INTOPIA is also a logical choice for entrepreneurship courses.
Due to the richness of the model, a common run of INTOPIA is often used to accommodate two different courses (economies of scale!), as, in the author's case, an International Business Strategy and a Marketing Management class. Naturally, surrounding lecture topics, readings and written assignments will vary in such a situation.
The most typical application of INTOPIA is as a course in itself. It may, however, equally well be used as the core of a course (or module in an executive program) where lecture-discussion, cases and other traditional instructional technologies also play a prominent role. The author typically uses the simulation in a context where it counts for 40-60 percent of the grade, depending on the type and purpose of the course. Participants should be aware that whenever INTOPIA is used maximum benefits from the simulation experience require a fair amount of teamwork outside of class.
How about Executive Development Programs?
The most typical use thus far is in a week-long program; this allows for 6Q decisions, plus half a dozen - or more - lecture-discussions on non-INTOPIA topics. In such a program, at least three evenings should be reserved for in-depth analysis, networking and decision-making among companies. Unless the sponsoring institution (be it a company, consulting firm, or a university) expresses a different preference, it is often desirable to encourage participants to assume other functional roles in their teams than those in their everyday life. It is a satisfying experience to have this kind of a comment from an individual whose ordinary position is that of plant manager: "I was the marketing manager in my team, and what do you know. I found myself using the same wild arguments I hear from my marketing friends in my own company!"
Participants may include top executives as well as middle managers, and selected (promotable) junior managers. We have also had strikingly positive experience of including technical and professional people in need of a better understanding of what business management and strategy is all about.
Increasingly, multinationals are calling management conferences or seminars comprising representatives from both home office and overseas subsidiaries for exchange of views and experience. In such a context, INTOPIA may represent a non-threatening and yet instructive environment of cross-cultural and cross-functional interaction. In these cases, it is possible to run just two or three decision periods, plus briefing and wrap-up. Thus, it would be possible to run the simulation in just two-and-a-half days, with half of the time devoted to the agenda of the sponsoring organization. Indeed, in some situations it would even be feasible to restructure the simulation to suit issues of special interest to the sponsor. One might also use a particular set of INTOPIA B2B outputs for a management-audit and diagnosis-type case discussion.
Are undergraduates mature enough for INTOPIA?
At the undergrad level one might confine use to seniors majoring in business, economics and/or engineering. A business policy or strategy capstone course would likely be a prime candidate among alternative courses. In our experience honors students, from any area of the university, display insatiable ambition around INTOPIA. At present, a dozen institutions are running INTOPIA with undergraduates. Indiana University - which has a highly ranked undergrad program - has run the simulation from time to time as an obligatory course for all undergrads. This involves over 500 students at a time, distributed in "worlds." See also General & Itemized Simplification of INTOPIA.
Any use in doctoral programs and with non-business grad students?
Most of our clients are using INTOPIA in MBA courses. Masters-level students from other parts of the university will often do well, notably if a fellow team member has at least an elementary grasp of accounting. Many business schools increasingly emphasize training in pedagogical skills for doctoral students. In the future environment of team learning, the use of games will undoubtedly grow. At Indiana, we have found that serving as coordinators or associate instructors in INTOPIA and other experiential learning exercises will be valuable training for their teaching careers.
How many decision periods in a university course?
The minimum workable in a university context is 6Q (simulated quarters of operation). Typically, it takes students 4Q to really "learn the ropes" of their roles as executives. Optimal learning in my experience is 8-10Q. After Q12 diminishing returns set in, despite the fact that some students seemingly would like to go on forever. Naturally the number of Qs will also depend on the nature and amount of non-INTOPIA material the instructor wants to introduce. Keep in mind that briefing will take 1-2 sessions, and management performance audit, intra- and inter-group evaluation, the examination of "what have we learned," and instructor review another one or two.
How should I allocate participants to company teams?
In our experience, random assignment by the facilitator is the worst way of handling the allocation of participants to company teams. A research project undertaken by a University of Chicago faculty group seemed to indicate strongly that heterogenously composed teams (in terms of grades, functional majors, inclusion of students from other countries vs. "nationally" organized teams) tend to perform better than homogenous groups, an observation which seems informally confirmed in many later runs. Student participants are generally allowed to select teammates on their own, but cautioned that "your best friend in a social context may well disappoint you in a task-oriented situation." As face-to-face contact between team members outside of class is clearly desirable, they are also asked to consider where potential members live relative to each other.
Any guidelines for internal organization of teams?
The back cover of the INTOPIA B2B Executive Guide has a chart showing "clearcut" organizational approaches, i.e., by product, area, function or clientele. Regardless of how teams organize - and this includes such "hybrid" patterns as process and project organization - executives can easily find the data most relevant to them, and their performance may also be evaluated to a realistic degree. By the way, note that modularity characterizes the data flow in the simulation, that flow being organization-neutral.
Can you add new companies during a run?
Yes, at any time you can add new companies, whether the facilitator wishes to restart a misfortunate team, or a company wishes to add new subsidiaries, or two companies wish to set up a joint venture. Once established, however, a company cannot be totally eliminated - although it may leave only an empty shell.
It sounds like INTOPIA requires a big time commitment by the Facilitator?
Let us say that INTOPIA calls for a greater commitment than the average management game. But then, it is no average game! Experience also indicates that INTOPIA is freer from bugs than the average simulation exercise, and unforeseen bugs are known to result in undesirable spill time. Several instructors have told us they found that learning about the INTOPIA B2B model was a stimulating, quality-time experience.
Nevertheless, to bring about a workable understanding of the model (including a "dry run" prior to a full-scale university course or an executive program), and a feeling of having desirable administrative control, will typically call for two to three full-time equivalent weeks. Many will regard this as a one-time investment, paying off over several runs of the game. Others will want to explore more than "routine" aspects in later games, involving such things as designing their own scenarios of world events, systematic experimentation, or the run of the simulation as a research vehicle.
Once basic "understanding" and "control" have been achieved, the time commitment becomes quite flexible, and in large part depending on the availability of an assistant, capable of handling the rather simple technology of computer operations, and the more sophisticated activity of output analysis (and generating industry "gossip") as well as handling team questions and the occasional misunderstandings which are unavoidable in any team and inter-team exercise. Clearly, an indispensable prerequisite for success is that the facilitator is personally motivated to give the simulation the respect participants deserve.
Several Management games are run and controlled centrally from a single seller institution. The disadvantages are twofold: direct interaction between the local instructor and the participant is reduced, and the students easily get the feeling that s/he is not personally comitted to the simulation.
Do teams have to implement strategy?
Strategy without implementation can be a fairly useless exercise - as in many case discussions. The acid test comes with implementation. The strength of a sophisticated simulation like INTOPIA B2B is the dynamics of implementation, that is converting the concepts of strategy into virtual reality, over time.
How many decisions must an INTOPIA company make each Q?
The answer is from one single decision to a practically unlimited number! As in everyday life, a completely risk-averse investor can make a modest return simply by investing one's entire capital in government bonds. However, there is no need to participate in a semester-long exercise to discover this. Stakeholders in business expect a greater reward for their participation in more or less risky enterprises. The number of requisite decisions in any given Q tends to grow exponentially with strategic ambitions in directions such as geographic, product, and functional diversification, vertical integration and, not least, inter-company networking. The screens on which actions are recorded each comprise from one to 10 identifiable decisions. Rarely would a company get by with less than five screenfuls per Q. Typically, you find around 10 decision screens, and it is not unusual to find 20. Thus, depending on the range of its mission, a company may find itself facing anything from 10 to 100 or more specific "decision points" in any given Q.
Any suggestions about company and individual performance evaluation?
The existence of thousands of Wall Street analysts and advisors (and corresponding professionals around the world) demonstrates the challenge and complexity inherent in the evaluation of companies and their management. The more realistic a management simulation exercise, therefore, the more varied will evaluation criteria tend to become, and the greater the role of the predilections of individual evaluators regarding the weights to be given the different criteria. An incisive examination of this topic is found in a Thorelli article reprinted as an INTOPIADD in this home page.
Whatever the philosophy and criteria of a given instructor, students have a right to be informed about them at the very beginning of the run. Without any pretense of magic we present here Hans' general philosophy and an illustration of how he attempts to illustrate it in practice.
How do you feel about inter-institutional runs of INTOPIA B2B?
If two or more institutions (or campuses of the same university) will have a common run of INTOPIA, each institution (or campus) must have a license. Licensee will notify INTOPIA, Inc., name and address of cooperating persons and institutions before the run. No run will be undertaken until Licensee has made sure that all participating institutions have obtained licenses from INTOPIA, Inc.
You talk about entrepreneurial decisions and opportunities - what do you mean?
To me, the most crucial set of entrepreneurial decisions is that which defines the nature, the very concept, of the business. The exhaustive set of such dimensions consists of product (or service) made or sold, functions performed, clientele(s) served, territorial extension and time. The set of opportunities available is indicated in the diagram below, taken from the Executive Guide:
Table 1 Entrepreneurial Opportunity in INTOPIA
Company A may be a maker of chips in the U.S. and of PCs in the EU, and a wholesaler of both products in Brazil, while serving PC makers with chips in the U.S. and EU, and marketing PCs to end consumers in EU through a captive sales organizition. Chip making in the U.S. may begin in Q2, PC manufacture in EU in Q3 and wholesaling in Brazil by Q4. The illustration shows that scores of business profiles are available.
At the beginning of the simulation companies are obligated to define their business. However, they are free to change their business concept at any time during the run. (In most other games all firms look alike from the outset, and do not have the opportunity to change the nature of their business.) Experience indicates that virtually no company has been able to meet "all" the entrepreneurial opportunities in the course of a semester-long run. As in practice, nobody can be everything to everybody!
Could you illustrate the types of inter-company agreements that can be made when you brag about unlimited transaction freedom as a unique INTOPIA feature?
It is "unlimited" barring possible antitrust violations. In our experience, competitors are quick to complain when cooperation takes an unfair toll on third parties. The facilitator has to be the judge of this (note: Brazil does not yet have an effective competition policy.) Also note that somebody will always be able to think of some obscure agreement which the model cannot implement. We are talking about unlimited opportunities for practical purposes:
Note, finally, that an important benefit of transaction freedom is that it enables a company to position itself wherever it wants in the value chain.
MNC Headquarters, where are they located?
In Standard runs, all companies are headquartered in Liechtenstein, which somebody said has more MNC headquarters than its 30,000 inhabitants. Liechtenstein was chosen for three reasons. It has a low tax rate. It is "neutral," not being located in any one of the operating areas, thereby hopefully preventing companies from choosing an operating area for nationalistic reasons. Its currency, Swiss Francs, is hard and relatively stable, and sets a "lingua franca" (no pun) standard for intercompany comparisons.
In Custom runs, HQ may be in a different country (still outside the operating areas). For instance, at Thammasat U. in Bangkok, HQ is in Thailand. This has a clearcut motivational effect on local students.
Are the relationships between all variables deterministic?
INTOPIA is really composed of a series of interactive "modular models," each one of which is pretty complicated. To stimulate participants in their attempts to make some sense of it all, we have deliberately chosen to make relationships between variables deterministic (note, however, the confounding influence of intermediate variables, encountered here as in practice).
There is only one important exception to this rule: the R&D function, which is semi-random, semi-deterministic. We believe that innovations do not automatically appear just because you throw money at them. In effect, R&D investments build a probability of yielding a patent based on the amount involved (with a diminishing returns function) and the consistency with which it is applied Q by Q. The probability cumulates until a patent is obtained, which happens when the probability matches or exceeds a random number automatically generated. At the beginning of the next Q, the probability is set to 0; however, as the R&D group is now a smooth-working team, probability increases will now come faster, assuming constant R&D amounts each Q. The facilitator may influence the stream of patents by resetting a "threshold" parameter whereby companies with probabilities exceeding the threshold automatically receive a patent. As practice sadly demonstrates, some patents are the delight of engineers, but consumers decide the resulting products are "duds." Companies can find out what grades of patents are lemons by (paid) marketing research, or, the hard way, by launching them in the marketplace. Patent licensing between companies is always possible.
Somewhat related to your question is the issue of introducing random ranges in replies to requests for market research and consulting information. Such ranges do exist for some 30 percent of the 80 standard items involved. The facilitator may, of course, change the ranges to his/her taste. It is a good idea to have the correct figure be somewhere within the range (this is the case with the default settings).
How are chip and PC technologies related?
The model assumes that R&D for the patented improvements of one product proceeds independently of the R&D for the other product. The management challenge in this area is to keep the technologies of the two products in synchronization. In the conversion table below, a 0 means "no compatibility," and the digits 1-5 indicates the number of given chip grades needed to make a PC of a given grade. For example, to make a PC of grade 2, 3 chips of grade 0 are needed, but only 1 chip of grade 3.
If PC technology develops faster, and only XO chips are available, the max. grade of PC that can be produced is Y2; similarly Y9 requires at least grade 8 chips. Conversely, if chip technology is ahead, X5 has no use in PC production unless the PC to be made is at least Y3, and, similarly, X7 has no PC application until Y5 has been developed. In addition, production scheduling (and marketing) becomes a major challenge.
How about raw materials for company Decision Support Systems?
The key here is that the output of each Q (including its decisions) is printed in Excel format. This provides an almost unlimited opportunity to use all kinds of analyses. (To assist less sophisticated users, we have made a file, ExcelIntro.xls, with a sample of B2B analyses. The file is available for download here.) Benchmarking of competitor financial performance is facilitated by the provision of the consolidated balance sheets and income statements for all firms every four Q (corresponding to annual reports). Companies can also pay for such statements in Qs 1-3, 5-7, etc. An important qualitative part of the DSS is the CIA Gazette, forecasting, rumoring and reporting on world events - especially when the Facilitator chooses to supplement it with gossip about individual companies. In networking with other companies, a firm will also pick up significant industry information - whether as a by-product of negotiations and transactions or on a formalized data-sharing basis.
INTOPIA is programmed to supply data for a catalog of 80 standard marketing research items and manufacturing cost estimates. Finally, an open-ended opportunity is provided for non-standard consulting items which the facilitator may supply to individual teams, at a mutually agreeable price.
Any room for qualitative factors and ethics concerns in INTOPIA?
It is our belief that qualitative factors should be given a prominent place in computer simulations in the game form, as such exercises can easily become pretty "sterile." Certainly, such elements play a great role in practice. Too, the author feels that despite the admitted difficulties of measurement, performance along qualitative dimensions should be taken into account in performance evaluation. The Thorelli Thunderbird Course Synopsis makes it clear that "a major part of INTOPIA evaluation is the ability of your company to participate in cooperative systems (networks) with other companies." Self-evidently, negotiation in itself constitutes an important qualitative activity.
Group assignments of a qualitative nature may play a role both in evaluation for grading purpose and in directly affecting the fortunes of a company. For example, company mission statements and objectives (including supporting evidence) may be viewed as constituting a "prospectus" for investors - thereby influencing size of starting capital - as well as for grading. Companies may also be challenged with items of social, environmental, ergonomic and related areas of "corporate responsibility," broadly defined. (Illustrations on request.)
With regard to the second half of your question, many of us feel that every decision that may affect more than one person involves ethical issues. Interaction among team members in any game reflect questions of ethics, from "freeloading" to maintaining a balance between camaraderie and leadership within the group. In addition, in INTOPIA inter-company networking is steeped in ethics problems at once complex and important. Some of them originate in the buildup of trust and maintaining trust at the cost of opportunism and short-term gain. Rarely is power equal in a relationship between companies; the exercise of power is unavoidably afflicted with questions of ethics, whether or not these questions are articulated. Too, not even the artistry of the most skillful lawyer will suffice to take all possible future contingencies into account. Occasionally the facilitator may be called upon by teams to arbitrate conflicting ethical issues. Again, we shall be happy to provide some guidelines in this area, if desired.
You seem to have answers to most questions! A final request: give us some examples of happenings in the Model Scenario of World Events.
Here we go with examples of scenario events:
What can we expect by way of INTOPIA updates?
As INTOPIA users are aware, very significant improvements may be made using the current framework. INTOPIA, Inc., is serving as a clearinghouse for new ideas on the part of users as well as the design team. We have already published many INTOPIADDS in this home page, covering a wealth of novelties to the user community. New users will automatically receive past as well as future issues of INTOPIADDS - and, hopefully, also contribute new ideation and useful hints for fellow facilitators.
Upon purchase of the simulation, you will also be added to our INTOPICS Newsgroup. This is a closed, moderated list just for INTOPIA Users. You can send questions, problems, or praises to the INTOPIA community through this list. Currently, all new INTOPIADDS are also distributed through this list. To ensure your subscription, please be sure to include the e-mail address of the responsible party when ordering the simulation.
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