Saturday, April 27, 2013

SDMs Join First MEMPC Simulation Competition

By Lynne Weiss

SDM Fellow Terence Teo was a member of
the winning team in the MEMPC's first
simulation competition. He and his
teammates each received a Nexus 7
wifi tablet.
Photo by Dave Schultz
Several SDM students recently had the opportunity to build their systems thinking capabilities and expand their professional networks when they participated in a simulation competition organized by the Master of Engineering Management Programs Consortium (MEMPC).

Founded in 2006, MEMPC was formed to raise awareness of the value of the master of engineering management (MEM) and similar degrees, as well as to share best practices, curricular innovations, and information among member institutions, including MIT, Northwestern, Stanford, Cornell, Duke, and the University of Southern California.

Mark Werwath, director of Northwestern's MEM program, proposed the simulation competition to give MEMPC students an experience comparable to the business case and business plan competitions offered in traditional MBA programs. He also hoped that the multi-school teams would help students expand their professional networks beyond their own institutions.

The competition, MEMPC's first, was managed and moderated by Jeff Lefebvre and David Semb of PriSim Business War Games. Both men are also adjunct faculty in Northwestern's MEM program. "Business simulations are great at building systems thinking capability," Semb said in a recent interview. Lefebvre noted that simulations help engineers let go of the idea that there are "right" solutions to business problems.

The five SDMs who participated were Brian Hendrix, Daniel Camacho Gonzalez, Terence Teo, Shiladitya Ray, and Dexter Tan. Each was assigned to a different multi-school team that played the role of a company in the domestic automobile industry. Teams managed short- and long-term objectives and made decisions about how to interact with competitors, what new products to introduce, and how to support new products. Each team was responsible for establishing its own organization. "Teams could organize by function or by product line," LeFebvre said, noting that there is no one right way to organize any business or team.

The competition began February 11 after students had a chance to review the competition manual and explore PriSim's website. The winning team was announced on March 11.

Teo, whose team won, said his group began by identifying its company's strengths and weaknesses as well as market opportunities and trends. Teo felt that a big part of his team's success was the willingness of members to agree on a strategy—to maintain their product line of high-value cars with a small market and big margins. "We kept our focus on upgrading existing models and on introducing new vehicles quickly," he said.

Teo also credited his team's success to the members' respect for each other's views. One of the few areas of serious disagreement related to pricing. To get advice on this issue, they used one of the two "lifeline calls" to Semb that each team was allowed. Semb suggested they compare the prices dealers paid for cars to what they charged customers. "We realized we had to set a price that was competitive, and that let dealers make higher profits in order to motivate them," Teo said.

Hendrix said he volunteered for the simulation because he wanted to "reinforce some of the real-life experiences I've had and put some of the theory I've learned into action." A product development engineer for Ford Motor Co., Hendrix learned from the opportunity to make executive decisions regarding supply chain and brand management.

Although only one team came out on top, Lefebvre said that in his experience, participants on the teams that struggle most often learn the most. Tan, who works for Continental AG, a German auto manufacturer, agreed. Although his team finished fifth, Tan said he learned leadership skills and the importance of planning and communication. He was enthusiastic about the experience because it provided a "risk-free platform" for testing competitive innovation strategies that he has learned about in class.


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