Business simulations are widely accepted as an excellent way to give university students, particularly within courses such as business and management, some experience in running a company in a risk-free environment, and to give them the opportunity to put their knowledge from lecture courses into practice. But why do so many universities use them? Thanks to a recent study by the University of Huddersfield, we can see proof of the development of students, both in terms of their business skills and on a personal level.

The study took the form of a questionnaire based on the National Council for Graduate Entrepreneurship entrepreneurial outcomes, which the participants filled in, both before and after a simulation programme (in this case SimVenture, which has similar learning objectives and structure to the Executive Business Simulation by April Training) was run. The results, though preliminary and only of a small sample, are very promising:

Source: Dr. D Williams, 2010;

Impact of Business Simulation Games in Enterprise Education

This shows that students perceived themselves to have improved in every entrepreneurial area, from being more able to tolerate failure to improved financial analysis. Although there may be some bias, particularly immediately after the simulation, the results seem to show that simulations such as Executive really do benefit students in a tangible and useful way.

Executive focuses on developing these key skills in participants, as well as being an enjoyable way to learn and test out business strategy ideas in a risk-free environment. It is also an online simulation, meaning that it is easily accessed and fast-responding, a real bonus and a unique feature among training simulations. This makes Executive perfect for use as both part of a university or college-level course, and in corporate environments, to give employees and students alike the necessary personal and entrepreneurial skills to succeed in real-life busienss.

Lord Alan Sugar’s comments on Engineers in business has received a lot of media flak, mostly deserved. However there is an inkling of truth in his statement. He may not have met an engineer who could turn his hands to business simply because the majority of engineers simply choose not to do the day to day running of  business.  The few who do include some spectacularly successful entrepreneurs, like Henry Ford, James Dyson, Steve Jobs, Bill Gates, Michael Bell etc, etc.

Engineers make very good entrepreneurs and business leaders in technology businesses, where their knowledge and vision allow them to see far beyond the limited technological horizons of most other professions. Indeed the subsequent replacement of the technological entrepreneur by a “business administrator” has led to some spectacular business declines, reversed only when the original entrepreneur returned – Apple and Dell Computer are classic examples.

So what else is stopping the budding engineer/technologist from going on to be successful entrepreneurs?

Fundamentally it is far easier to learn appropriate business skills than to learn engineering and technology skills; after all the best MBA can be picked up in a year or less. Business training courses are available throughout the world and many qualified engineers step up to the challenge each year. However it is an expensive proposition and not high on the priority of many an engineer who in general want to get on and “do things”: practise engineering, rather than waste too much time in the seemingly boring world of business.

Many good engineering Universities recognise this dilemma and have added business courses to the engineering curriculum so as to introduce engineers to world of business, and in so doing demonstrate the value of business “nous”.

The even more switched on Universities use modern computer simulation technology to allow engineering students to run virtual businesses and prove to themselves that they have the requisite skills. An example is the Executive Business Simulation, one of the most advanced computer simulations of a manufacturing business available.

So many more engineers are now being trained in the art and science of business, many with the help of simulation, and are emerging into the workplace more than able to take on the challenge of entrepreneurship and business leadership.  This should please Lord Sugar.

April Training are running an event at Liverpool University starting on Friday 10th June, which involves the use of our Executive business training simulation, aiming to give students a new and exciting insight into the world of business and entrepreneurship. This will give the students the chance to test out their business skills and try some new ideas in order to attempt to build up a successful company in the European car manufacturing business. They will use real-life current market data to make the simulation as realistic and believable as possible, and their performance will be assessed by tutors, along with associated paperwork.Executive is designed to be competitive, which increases motivation of the students at Liverpool University, as well as giving them even more reason to carefully their decisions and make sure that their team follows good business principles. They will be competing against 8 other teams, so the students are separated into ‘worlds’. This prevents the markets from becoming saturated and gives everyone a better chance of success.

The simulation programme is intense, lasting just over week, meaning that students only have a short time to get to grips with the principles behind the simulation, as well as learning how to input data and making use of the what-if facility built into Executive. However, the short time period increases engagement with the simulation, and gives the students some experience of the time pressures commonly found in a business environment. It will also test their organisational, time-keeping, teamwork and communication skills; all of which are essential for success in the world of business.

Our team here at April wish them good luck, and as always will be on hand to provide both technical support and a helping hand to any teams who find themselves in difficulties.

First you need the basic knowledge:

For a high technology business these days, this may mean a university education or equivalent in the right area. If you are studying Engineering then make sure you also pick up the basics of business. One very effective method is the use of business simulations. The best ones provide excellent experiential and quantitative learning of the key ingredients, profit and loss, balance sheets, marketing, financing the business and most importantly – bringing all the skills together by team working.

You need the skill base.

Anders Ericsson postulated the 10,000 hour rule – that works out to be 5-10 years working in the relevant technology. Specific examples; The Beatles and Microsoft’s Bill Gates are given in the book Outliers by Malcolm Gladwell.  The key element here is that you need long enough to know what works and what does not. Interestingly this period will probably include some initial failed attempts – very important learning. Frank Williams at Williams Grand Prix engineering is just one a classic example; early failures did not deter him.

You need your team

Invariably you alone will not have all the detailed skills required, or the desire to do all that is needed to be successful in business. Building your team is extremely important as they can make or break the venture. They can also “steal” the business so great care is needed (and a fair dose of paranoia).  Choose the skills you need carefully – typically you may need, finance, marketing, sales, manufacturing, technology, logistics etc. Try to get the best there is and don’t be afraid to pay them more than yourself- this is not about pay prestige, it is about results. Short term consultants can also work.

Clarification of team roles, rewards and time scales is very important. One very important, rarely mentioned reality is the transient lifetime of any team. A successful venture will grow quickly and as it evolves will require new and different skills. Some team members will need to go and new ones to come in, at all levels, perhaps eventually even you. Be prepared for this, plan ahead and keep on learning, regular sessions on the business simulator will always be beneficial – like sessions in the gym.

Finally

Goes without saying that you also need a clear vision for the business, along with drive, ambition, courage and determination.  Most importantly, you also need to conduct your business ethically, with concern for your employees, customers, suppliers and the society and environment you operate in.