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The Work of Business: A Web-based Simulation
From: University of Michigan
| By:
Michael D. Gordon |
EDITOR'S INTRODUCTION |
 How does work get done in an organization? Michael D. Gordon (right), professor of computer and information systems and of business administration at the University of Michigan Business School, helps future business consultants learn how to analyze different patterns of work, business processes, and the best practices of effectively run organizations in an innovative way. Gordon created a Web-based simulation of a fictitious business--The Utility Company--to teach his undergraduate business students how to diagnose the ills of an ineffective business. Here, Gordon discusses the common problems many businesses face and provides a demo version of his business simulation. |
 an a company be going downhill when all its employees are doing their jobs to a "T?" When departments are meeting their goals, can the company still be falling short of its own? With so much advanced technology available, can organizations still be run essentially the way they were 25 years ago? |
Unfortunately, even if surprisingly, the answers to these questions and others like them is "yes." Imagine all the employees of one department tugging their company as if it were on a rope. Despite their training, fitness and determination, they still may be wasting their efforts if another unit is pulling just as hard in the opposite direction. Such conflicts occur, for example, when the sales department aggressively sells products that manufacturing can't produce.  When the new products department whips up products that customers don't want. Or when effective production must deal with inferior raw materials. And why should this surprise us? Salespeople are rewarded for selling more, not for what manufacturing does. For new product research and design teams, patents and new ideas are the local currency--not customers' tastes and behaviors. And though production might prefer the highest quality raw goods, isn't purchasing doing its job when it holds down the costs of raw materials as much as possible? |
Of course, such "disconnects" are not by conscious design. Instead, patterns of work evolve over time, often by layering new behavior on top of old. As a company grows, or merges, or is acquired, its business processes can reflect several organizations, or several eras--all at once. Further, the complexity, specialization, and size of today's organizations mean that its separate departments can be ignorant of how others perform their work. For instance, a manufacturing process may involve contacting suppliers, selecting the ones with the best prices, placing orders for raw materials, receiving the purchased goods, comparing the paperwork for ordered and received items, warehousing what is received, and dozens of other steps--every one of which is likely performed by many different people, each of whom does it somewhat differently, and none of whom understands the way these many activities intertwine across departments to form the overall process. So, one person or department pulls the rope as hard as it can as another thwarts its efforts. |
What about information technology? Can it be used to cure these problems? A large, well-known manufacturing company has over 1,000 different financial information systems. Imagine the difficulty in pulling this information together to get a consolidated view of the company's financial health, or to help make an important strategic decision. At the other extreme, companies have raced to build enterprise-wide information systems to the tune of hundreds of millions of dollars. These systems promise to integrate information, not splinter it into so many different parts--and to unite a firm's disparate departmental activities into larger, corporate-wide processes. So much for the theory: in practice, these systems can force companies to "re-wire" themselves in ways they don't want--simply so they can make the technology work. So, despite the promise and tremendous advantage offered by technology, it is not a panacea or sure-fire solution for producing effectively run organizations. |
Somehow, I wanted to teach undergraduate business students at the University of Michigan about these kinds of issues--to teach them to understand how work gets done in an organization, diagnose its shortcomings, determine alternative ways of accomplishing the desired result, and select the best among them, including the appropriate technology. But how do you teach students to understand "how work gets done in an organization" when this can involve dozens or hundreds of people, often working in multiple locations; people who can produce volumes of information, often without regard for who else is consuming it; and, more generally, people who often have no knowledge of how their work is linked to others'? |
In the real world, such work falls to consultants who, for all intents and purposes, become live-in members of the companies they are advising. In fact, in our graduate program, we send students out of town to "live" at a company for two months so that they gain experience in thinking and solving problems from a business process perspective. But for undergraduates, that is not feasible. |
Instead, I developed a Web-based simulation of a fictitious business that formed the basis of a semester long course on business processes and information technology. Working in teams, students used the Web to conduct dozens of "interviews" and review information relevant to this business. The interviews consisted of watching streaming video movies of management, line personnel, customers, and others at the company. The information students reviewed included financial records, personnel information, customer payment records, and much more--all delivered electronically over the Web. |
Over the semester, students interacted with me through weekly summary briefings. In a briefing, they would summarize what they had learned that week through interviews and data analysis and request to interview new people and receive new information to review. By the end of the course, a student team would have conducted interviews with about 30 of a possible 50 interviewees and reviewed a similar proportion of the available information. Every week, each team had to make choices about what interviews and information they wished to request. Before their request was granted, they needed approval from me (acting as a combination company VP and course teacher) based on the arguments they offered in support of their request as well as my knowledge of their progress to date. |
From my perspective, basing a semester long course on a complex, non-linear Web-based simulation that allowed me to continually add new course materials (interviews or information) was nearly ideal. But does it really get students to understand business processes? At the end of the course, one student who was contemplating a career in business process consulting told me: "I learned that being a consultant is way too hard. Now I know I don't want to be one." As an instructor, I could receive no higher compliment. |
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