I. The People Express MicroWorld I. 1 Introduction Our increasingly interconnected and dynamic world challenges managers to find new ways to understand and control change. The accelerating rate of technological, organizational, and social change means managers are faced with situations that are in many ways new, and must increasingly deal with the unexpected. Managers are not alone in facing such daunting tasks. Modern society is built upon systems of enormous complexity, from nuclear power plants to jumbo jets. A pilot, for example, must also control a system of great complexity and be prepared for the unexpected.
There is, however, one significant difference between the pilot of a jet and the manager of a business. No airline would dream of sending a pilot up in the real thing before they had had extensive training in the flight simulator on the ground. The simulator allows the pilot to learn, to make mistakes, to experience the unexpected without risk to passengers or aircraft. Yet managers are expected to fly their organizations into unknown skies with their only training being management ‘ground school’ or experience as junior crew members. The People Express Management Flight Simulator gives you the opportunity to ‘fly’ a company yourself.
The simulator functions just as an aircraft simulator does. You will take command of the firm and pilot it from startup to success. Each simulated time period you will make strategic and operational decisions, and receive feedback from your past decisions. You will decide how fast to grow, how to set prices, how aggressively to advertise. Your hiring policies will influence morale, productivity, and turnover; your marketing efforts will shape the growth of demand; your competitors will fight back. You may be surprised by side effects and delayed consequences of your own decisions. You may face financial crises or unexpected opportunities.
You may go bankrupt, or grow to dominate the industry. But there is no winning or losing. The purpose of the simulator is to to give you insight into the issues raised by the particular case; to illustrate the difficulties of coordinating operations and strategy in a growth market; and to understand the dynamic interconnections among a firm, its market, and its competitors. More fundamentally, the flight simulator is a laboratory in which you can systematically explore the consequences of various strategies without risking the fortunes of the real enterprise. Most of all, enjoy yourself. Experiment.
The first time or two you will want to try to succeed using the strategies you think best. In later trials you may wish to systematically vary aspects of your strategy to identify high-leverage policies. Don’t worry if you bankrupt the company. The beauty of a simulator is that you can ‘crash’ as many times as you wish and walk away every time. Indeed, most of the time real pilots spend in simulators is spent in extreme conditions. You can learn more from piloting the aircraft through rough weather, poor visibility, and with unexpected mechanical failures than in clear skies. Most of your learning