Achieving Exceptional StrategyExecution with Business

Simulations and ExperientialLearning

2

Why?

Are business simulationsand experiential learning

better suited thantraditional learning

methodologies to facilitatethe behavioural change

that it is needed to supportStrategy Execution

3

Why the need for Strategy Execution?

An alarming 57% of firms failed to efficiently executestrategic initiatives over the past three years *

An alarming 57% of firms failed to efficiently executestrategic initiatives over the past three years *

Companies on average deliver only 63%of the financial performance their strategy promised **

Companies on average deliver only 63%of the financial performance their strategy promised **

It’s no surprise that today’s CEOs identify strategy execution as their most pressing concern.***

* Economist Survey** Harvard Business Review*** Conference Board Survey

4

• Retention is low

• Critical elements needed forexecution

• Information is not enough3 Reasons:

Why not? • Adults want to be persuaded

• Adult based learning principles

• VUCA world

3 Reasons:

Why ?

Traditional

Buss Sims

5

Business Simulations are powerful tools todrive behavioural change!

What is a business simulation?

Industry or competitive market place

Company

Department

Models, MSRP,Invoice, and Priceare customized to

the region.

15

• Retention is low

• Critical elements needed forexecution

• Information is not enough3 Reasons:

Why not? • Adults want to be persuaded

• Adult based learning priciples

• VUCA world

3 Reasons:

Why ?

Traditional

Buss Sims

16

Retention is lowAverage

Retention Rate

5%

10%

20%

30%

From Corporate Universities, Jeanne Meister

50%

75%

80%

Discussion Group

Practice by Doing

Teach Others / Immediate Use

Competitive,simulation-basedaction-learning

Lecture

Reading

Audio-Visual

Demonstration

Fortune magazine - Michael Schrage

“successful adultstypically need topersuade themselvesthrough their ownexperience”

18

• Retention is low

• Critical elements needed forexecution

• Information is not enough3 Reasons:

Why not? • Adults want to be persuaded

• Adult based learning priciples

• VUCA world

3 Reasons:

Why ?

Traditional

Buss Sims

19

i = b

i + = b

*Michael Schrage - Serious Play

Change in information Change in behavior

Information is not enough – adults want to be persuaded

Experiential learning allows individuals to persuade themselves

simulation

20

• Retention is low

• Critical elements needed forexecution

• Information is not enough3 Reasons:

Why not? • Adults want to be persuaded

• Adult based learning principles

• VUCA world

3 Reasons:

Why ?

Traditional

Buss Sims

Chris Argyris

In single-loop learning, individuals, groups, ororganizations modify their actions according to thedifference between expected and obtained

outcomes.

“Argyris & Schön (1978)

Distinguished between single-loop and double-looplearning.

Double-loop learning

……question the values, assumptions andpolicies that led to the actions in the first place;if they are able to view and modify those, thensecond-order or double-loop learning has taken

place….

SINGLE LOOP LEARNING

GroupcomparisonThe simulation Financials and

KPIs

CompareAction Result

Double-loop learning

……question the values, assumptions andpolicies that led to the actions in the first place;if they are able to view and modify those, thensecond-order or double-loop learning has taken

place….

DOUBLE LOOP LEARNINGC O G N I T I V E

T RANSFERENCE TO REALITY

InputsCompareAction Result

I N T U I T I V E

Learning Loops

Assumptions/Paradigms

The A-Ha loop!

A typical simulation experience

Feedback Sessions

2 3

ApplicationSession

45

1 6

StrategicPlanning

Simulation Rounds

Pre-Work

3-4 DecisionRounds

Know-How Sessions

Do

ReflectApply

31

• Retention is low

• Critical elements needed forexecution

• Information is not enough3 Reasons:

Why not? • Adults want to be persuaded

• Adult based learning principles

• VUCA world

3 Reasons:

Why ?

Traditional

Buss Sims

What we learned

E = A M C

ActivitiEs

Strategy Executions

E : Alignment

3 Questions

Alignment1.Can you summarize your strategy, and

what makes it distinctive, in 30 words orless?

2.Would your direct reports say the samething?

3.Do lower levels know where and how theycontribute to driving the business?

E : Alignment

the right actions and decisions atall levels

E : AWhere?

E : A + CapabilitiesWhere?

E : A + Capabilities» Business Acumen Systems» Leadership Acumen + Processes» Functional Acumen Structure

E : A * C

the right actions, faster

Discretionary EffortEmotional Commitment

Employee Engagement

High LeverageBehaviors

Experience the need and impactof high leverage behaviors

E = A M C

49

• Retention is low

• Critical elements needed forexecution

• Information is not enough3 Reasons:

Why not? • Adults want to be persuaded

• Adult based learning principles

• VUCA world

3 Reasons:

Why ?

Traditional

Buss Sims

We are in a VUCA WorldWe are in a VUCA World

50 15-Oct-13

Volatility:

Uncertainty:

Complexity:

Ambiguity:

We are in a VUCA WorldWe are in a VUCA World

51 15-Oct-13

Volatility: The nature, dynamics and speed of change andchange forces; lack of predictability, potential for surprise

Uncertainty: Incomplete knowledge about the currentsituation. Cause and effect relationships are not evident. Lackof predictability and potential for surprise

Complexity: The multiplex of forces, the confounding of issuesand the chaos and that surrounds an organization.

Ambiguity: The haziness of reality, the potential for misreads,and the mixed meanings of conditions; cause-and-effectconfusion

Knowledge

Assumption

53

• Retention is low

• Critical elements needed forexecution

• Information is not enough3 Reasons:

Why not? • Adults want to be persuaded

• Adult based learning principles

• VUCA world

3 Reasons:

Why ?

Traditional

Buss Sims

55

• Retention is low

• Critical elements needed forexecution

• Information is not enough3 Reasons:

Why not? • Adults want to be persuaded

• Adult based learning principles

• VUCA world

3 Reasons:

Why ?

Traditional

Buss Sims

56

If you had to remember one thingfrom this presentation!

Business Simulations are powerful tools to drivebehavioural change!

Thank you and please visit theBTS stand

alex.kock@bts.com