EMBAs Win Big with the Business Simulation Capstone

It’s just a game, but the bragging rights last a lifetime. The capstone project for the executive MBA program at the University of Maryland’s Robert H. Smith School of Business is a business simulation game (BizSim for short) that allows students to put all of the business skills they learned over the 19-month program into play. The game, called “Marketplace,” from Innovative Learning Solutions, has strict deadlines and requires rapid decision making – it makes for a very exciting and intense final week and is always a highlight of the Smith EMBA experience.

“We instituted the simulation with the first EMBA cohort in May 2004 and it has been a success as a wrap up capstone project ever since,” says Joyce E. A. Russell, distinguished Tyser Teaching Fellow and faculty leader of the business simulation. “It requires EMBAs to integrate all the functional content they have learned in the program in a challenging, competitive fashion. It also enables them to test out their leadership and teamwork skills under intense pressure. It’s amazing what the teams are able to accomplish – truly impressive.”

Adam S. Bell, EMBA ’11, echoes Russell’s sentiments. Bell, president of winning team Xtreme Technology Computers, says the game integrated the various subject matter topics he learned throughout the program. “The game also emphasized leadership and teamwork, as there was a lot of work to be done in a short period of time, and having the right team was key to success,” says Bell, director of strategic planning in Corporate Strategy and Development at Constellation Energy. “It felt good to win, but more importantly, it felt better to have fun as a team with some laughs throughout the capstone experience.”

In the simulation, students are teamed up to form a company and compete against each other in a virtual universe selling microcomputers. Each firm introduces new lines of microcomputers into 20 international markets. The goal is to build a profitable company. There are five market segments to serve in the PC market. Each segment has different needs and each requires a different marketing strategy.

During the eight quarters of the game, teams are provided with market research and a balanced scorecard, which is the most important measure of the firm's total performance. It evaluates performance in all areas of business to produce a total score. The changing economic and political situation affects the attractiveness and cost of business in each market. Each student takes on a different role in the company – president, manufacturing, sales, marketing, human resources, market research, accounting, and finance – and each are responsible for making decisions related to their business function. Decisions include everything from product design and R&D development to sales force allocation and ad placement.

“The capstone business simulation provided a good synthesis of the EMBA approach taken at Smith,” says Lauren Good, EMBA ’11 and president of winning team Ocean Computing. “Smith's leadership focus requires a certain level of competency across all business disciplines, with the understanding that executives are not experts in each. In the simulation, using the balanced scorecard as the measurement metric reinforced our need to balance often-conflicting demands as we allocated our limited resources, and resource allocation should be directly aligned with the overall organizational strategy. Our team recognized this early, and aimed at being in the top quartile in every metric, understanding that the exercise didn't require that we lead in each to perform the best overall.”

In the middle of the game, teams pitch their business plan to a group of venture capitalists in the hopes of getting up to $5 million in funding. The venture capitalist (VC) role is played by former alumni of the executive MBA program, professors and real-life VCs. The teams give a 15-minute pitch to the group and then during a VC fair are able to negotiate stock price and investment value. Each VC is given approximately $2-3 million to invest in one or more teams. The VCs are also competing against each other to get the best return on investment. Russell notes: “This is one of the most exciting parts of the simulation experience. The VCs (especially the EMBA alums) fight pretty hard to see which of them will get the greatest ROI. They also provide excellent insights to the teams and help to build the Smith EMBA community.”

Chris Wolske, EMBA ’06, is a specialist master at Deloitte and member of cohort 5. He’s been back to serve as a VC multiple times since he graduated. “I keep coming back to meet people from the new cohort, and to welcome them into the Smith EMBA alumni community – hopefully setting an example that they will want to follow,” says Wolske.

Sol Ross, EMBA ’05, is a member of cohort 2 and he keeps coming back as a VC, as well. He’s often won the greatest ROI among VCs and says, “It's fun to get negotiation experience with absolutely no downside. I want them to do an alumni version! It's a good capstone project – holds your feet to the fire for five straight days.”

Wolske says he uses his own BizSim experience to help him with his VC picks. “I look for the team that is well-positioned to dominate the biggest markets, and committed to that focus and not distracted by the lesser markets. Our team didn't focus on the big markets, and we could never catch up to those who did.”

For Chris Hiltbrand, EMBA ’07, AVP and deputy HR director at SAIC, it was his first time as a VC. “I really enjoyed being on the other side of the fence,” says Hiltbrand. “My strategy was to listen and take good notes. I was looking for a team who really seemed to understand the elements of the game, so I looked at adjustments made from Q1 through Q4.” It served him well. Hiltbrand was declared one of the most helpful VCs by the students and earned a great ROI in the game.

Sudhakar Jale, EMBA ’10, senior marketing manager at W.R. Grace, had the best ROI in the competition and was also rated as one of the most helpful VCs. “I was looking more into the future strategy of the company rather than where they were at that stage and more importantly the chemistry among the team members,” says Jale. “I picked the team during the presentation and was able to grab the opportunity to invest all.”

Jale won the competition last year as a student in Cohort 9. “We had a great team,” he says. “I was fortunate to be part of the team with whom I had good relationship during earlier assignments. We often talk about the game when we meet.”

The Smith EMBA BizSim experience is something that sticks with you – win or lose. Russell says she continues to hear from previous EMBAs about the BizSim experience their cohort had, and “what might have happened if only they had one more quarter to play.”

“I still contend that if we had two more quarters, our team/strategy could have pulled ahead,” says Wolske. “It's become a running joke with some of my classmates. They remember the espresso machine I kept in the team room. I believe coffee worked as leverage in one of our licensing negotiations.”

Ross said his team was awarded a lightsaber for the firm with the greatest investment in the future and most likely to come back to win. “I still have it. Of course we still talk about the game, I won't let it go.”

The Smith School launched its Executive MBA program in the U.S. and Beijing, China, in 2003. The Smith School also partners with SAIC to offer an executive MBA program for its employees. For more information about the Smith EMBA program, visit: www.rhsmith.umd.edu/emba.

Alissa Arford, EMBA ’10, Cohort 9, Office of Marketing Communications