www.it-ebooks.info www.it-ebooks.info Enterprise Games Using Game Mechanics to Build a Better Business Michael Hugos BEIJING · CAMBRIDGE · FARNHAM · KÖLN · SEBASTOPOL · TOKYO www.it-ebooks.info EntErprisE GamEs by Michael Hugos Copyright © 2012 Center for Systems Innovation. All rights reserved. Printed in the United States of America. Published by O’Reilly Media, Inc., 1005 Gravenstein Highway North, Sebastopol, CA 95472. O’Reilly books may be purchased for educational, business, or sales promotional use. Online editions are also available for most titles (safari.oreilly.com). For more informa- tion, contact our corporate/institutional sales department: (800) 998-9938 or corporate@ oreilly.com. Editors: Mary Treseler, Mike Loukides Production Editor: Holly Bauer Copyeditor: Jasmine Kwityn Proofreader: Absolute Service, Inc. 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ISBN: 978-1-449-31956-4 [LSI] www.it-ebooks.info To my wife, Venetia. www.it-ebooks.info www.it-ebooks.info v Contents Preface | vii 1 | Transformation of the Great Game of Business 1 2 | Feedback in the Real-Time Economy (Why Games Matter) 11 3 | Feedback Systems Drive Business Agility 23 4 | New Paradigms and Operating Principles 37 5 | Gamification 47 6 | A Continuum of Functionality: Simulations to Serious Games 63 7 | Massively Multiplayer Online Games and Real-Time Collaboration 79 8 | Driving the Great Game of Sales 93 9 | Game Mechanics in Products, Services, and User Interfaces 105 10 | Environments of Decision 117 www.it-ebooks.info iv | contEnts 11 | A Novel Encounter with Big Data 129 12 | Game Layer on Top of the World 147 13 | Games for Change 163 14 | The Future of Work 175 Index | 193 www.it-ebooks.info vii P r e f a c e We are living in a time of big changes. We face changes driven by powerful forces like world population growth; rising prices for food, fuel, and raw materials; depletion of natural resources; and increasing levels of greenhouse gases in the atmosphere. And at the very same time, we are also surrounded by the rapid spread of new technologies such as social media, mobile consumer devices like smartphones and tablet computers, and cloud computing and software apps. Clearly, the path forward involves finding ways to use the potentials of the latter to address the challenges of the former. The magnitude of the challenges we face now is unlike anything we have experienced since the early years of the last century. At that time a hundred years ago, work and society were transformed by the spread of industrial technology and the resulting mass migration of people from farms and small towns to factories and big cities. The first decades of the last century saw a transition from the practices of an earlier age—the Victorian Age—to the practices of a new age—the Industrial Age. In the countries where industrial activity was concentrated, there was conflict between those who paid wages and those who earned wages, and yet ultimately, that conflict was channeled in socially construc- tive ways that resulted in the growth of a large middle class sustained by lifetime employment in companies offering jobs with career paths, benefits, and pensions. This economic model of employment became a worldwide standard during the last half of the twentieth century. Challenges and Opportunities Now, industrial activity has spread around the world. And we see tradi- tional practices that once sustained the middle class are disappearing in countries everywhere, and conflict between wage payers and wage earn- ers is returning. High rates of change in technology and volatility in the prices of everything from basic commodities to finished products make it hard for companies to predict demand for their products, and even harder www.it-ebooks.info viii | EntErprisE GamEs for them to create long-term business plans. A major result of this is the fluid nature of employment these days. People are employed one month and unemployed the next, and it is usually for reasons beyond their control that have little to do with their personal performance. Companies hire and fire as needed to respond to market volatility and rapid rates of change. Twentieth-century traditions of lifetime employment and jobs with career paths, benefits, and pensions are harder and harder to maintain. The personal and economic stress and dislocation this causes makes us yearn to revive or reinvigorate business practices from the last century so as to recapture the stability and benefits they once provided. But that yearning will go unrequited because those practices no longer fit the reali- ties of our real-time, global economy. Games and the associated technology we currently refer to as video games offer us more than just diversion and escape from difficult times. They offer us field-tested models to use for organizing companies and performing complex and creative tasks. They offer clear and compelling examples for how people can work together, build their careers, and earn a living in rapidly changing and unpredictable environments. The very notion that games could have anything in common with work will trigger some to reject these ideas out of hand. For the rest, this book offers a set of grounding concepts, case studies, and a big-picture view of the use of games and game-like operating models in business. As one person who helped me with this book said, “There is a huge game- shaped opportunity in modern business practices.” Audience for This Book This book is written for people who are interested in exploring the use of games to address the challenges we face. It is written to be accessible to a broad base of readers from business, professional, and technical back- grounds. It is written for change-minded business executives, and for people who advise them and deliver new ideas and services to them. It is written for people who design games and are curious about new opportu- nities that arise from the merging of games and business, and for people whose work is already taking on a game-like quality and who want further insight into what is happening. Footnotes and references are provided for readers who wish to explore in more detail the particular technologies, methodologies, and business practices that are presented. This is not a book that concentrates on any www.it-ebooks.info [...]... serious activity we call work But maybe we should think again We all have a sense of what a game is Regardless of whether we are talking about sports games or card games or board games or video games, we can see they all share a core set of traits in common Games are skills based, results oriented, and structured by rules Games have been described as having four defining traits: a goal, rules, a feedback... instead of hiring more financial analysts and management consultants to cut costs, maybe companies would get better results by hiring some good game designers to reach out to customers and business partners and increase participation Game Mechanics Applied to Business What follows is a case study from my own experience that illustrates how the creation of a feedback system can trigger the start of a game. .. (EDI) or a simple text file transfer process (FTP) Our business operating units could send in data the same way and so could the customer when it was necessary to update inventory data that our system didn’t have Inventory data was then extracted from our system and loaded into a central database, and we wrote some programs to pull data from the database and populate a spreadsheet On the spreadsheet,... your company, and your career This book provides a framework to understand, discuss, and participate in what is happening as games blend with business We’ll start our exploration of games and their potential by painting a big-picture view of what games are and how they can act as a model for organizing work The point of this is to establish a broad framework and a deep foundation for a wide-ranging discussion... circumstances Capitalism needs to evolve just as another great game that is central to our way of life has also evolved That other great game is democracy Imagine what our lives would be like if democracy was still practiced as it was a hundred years ago At that time in the United States, only men had the right to vote And a hundred years prior that, democracy was a game where the vote was even further... games and game mechanics might be as powerful a model for organizing knowledge and creative work as the assembly line was for organizing industrial and repetitive work Because we have been taught that play is the opposite of work and that a game is the opposite of a job, we believe that play and games are frivolous Thus, many of us instinctively reject the idea that games or play can be part of that... game to accomplish an important business goal We’ll also look at how the goal and rules of the game can be used to guide the conduct of the players and achieve the business results that companies want This case study provides ideas and techniques to work with and apply to similar situations in your own company The challenge that called for this application of game mechanics arose suddenly, as often happens... month after month and year after year on operating the company efficiently and doing what they need to do to achieve company performance and sales objectives People are taught to read monthly financial statements so they can assess for themselves how they are doing, how their team and other teams are doing, and how the company as a whole is doing This use of transparency and clear rules has created a game- like... middle of negotiations for a new three-year contract, and failure, as they say, was not an option.3 When we arrived at their headquarters, we signed in at the front desk, clipped security badges onto our blazers, and didn’t say much as we waited for the meeting to start Someone came out and led us back through a maze of hallways and work areas and up a wide staircase to a meeting room where a collection... on top of and communicate with existing transaction processing systems that companies already have—systems such as ERP, CRM, Supply Chain, and HR/Payroll Real-time business intelligence systems and analytics can be added to provide data transparency and reporting Simulation and “what if” modeling can be added to support training and decision making And real-time communication systems using text, audio, . think again. We all have a sense of what a game is. Regardless of whether we are talking about sports games or card games or board games or video games,. www.it-ebooks.info www.it-ebooks.info Enterprise Games Using Game Mechanics to Build a Better Business Michael Hugos BEIJING · CAMBRIDGE · FARNHAM · KÖLN · SEBASTOPOL · TOKYO www.it-ebooks.info EntErprisE