How Businesses Use Games to Gain
“Gamification” is a pretentious new buzzword for a practice that’s been around a long time–using games to generate solutions to business problems. People who use the term often do so breathlessly, as though they’ve discovered something truly unique.
The Atlantic magazine actually called the term gamification “bullshit.” I wouldn’t go quite that far, but the term and concept has spawned articles, conferences and workshops that are re-introducing what Jack Stack, the pioneer of open book management, started 23 years ago with his book, The Great Game of Business.
Open book management is the epitome of high-performance communication management. It’s a leadership philosophy that’s grounded in the notion of creating businesses of business people, where everyone in the organization thinks and acts like business owners.
A big part of open book management involves using games to improve performance. Some games are technology-based, while others rely on informal goal-setting, friendly competition and winning celebrations. People on a team use a game to improve real-time work, which in turn improves business results.
We’ve used games for years and they can produce huge business results if managed well. That’s what’s exciting about this form of high-involvement activity.
One client I worked with manufactures latches for overhead bins on Boeing airplanes. They were generating too much scrap and rework on two lines that made these latches. Scrap, of course, is defective product that has to be discarded. Rework is the process of correcting a defective product to meet customers’ requirements. Both are costly.
People on the two lines “put a game on” reducing reduce scrap and rework. They agreed on game goals–the amount of reduction that they would try to achieve. They created game rules, a timetable for hitting the goals and a prize that would go to the winning team. After 11 days, one team hit the goal and the other exceeded it. The two teams reduced scrap and rework by 75%, which was a huge savings to the company. Both teams celebrated together. It was fun and exciting. It built teamwork and it improved business performance.
Another client wanted to reduce the time required to shift from making one product to making another one, often called a job change or changeover. Reducing changeover time reduces downtime and improves productivity. The people who could influence the duration of the changeover decided to put a game on reducing downtime. Again, they set the goal, the rules and the prize if they hit the goal. Within two days, they exceeded their goal and reduced job change time by more than 80%.
Here are three factors that will increase your chances of success using games.
- Involve people who do the work.
The people who do the work every day know best how to improve that work. They should help identify the problem, its root cause and action that’s needed to make the problem disappear. They should help set the ultimate goal and the prize or payout when they hit or exceed the goal. (Don’t try to dictate how this should get done.)
- Focus on Real Business Performance
The goal and upside opportunity must focus on a real business performance issue–quality, delivery, cost, productivity, sales/revenues, safety, etc. They should be results-oriented measures, not soft measures or activity measures with no business impact.
- Choose Games That Bring Gains
The cost of the game–and the overall effort–must be acceptably smaller than the gains that are made. In each of the aforementioned games, the return on investment was more than 500%. If the game doesn’t produce a gain larger than the cost of creating it, you’ve likely drained value. A game should create value, not drain it.
In many of the games I’ve helped create with clients, participating employees have set higher goals than our clients’ leaders would have expected them to. And they have exceeded their goals many times. The prizes or payouts that employees select are always reasonable.
You can call this practice whatever you want to call it. However, it’s been my experience that just using plain, old “games” will come across as sincere, genuine and in touch with your people.