A constructivist approach to designing business simulations for strategic management

Abstract

The authors considered two principles of simulation design (simple rules and smart algorithms) and three essential attributes (choice of industries, employer-employee relationships, and real markets for products and participant services) for strategic management business simulations. They applied these considerations and a constructivist approach to develop a computer-assisted simulation, using it to investigate the concurrent and predictive relationships of market share and production experience on profitability. The authors found that the relationships are (a) as expected and stronger than those reported in an earlier study using a simulation of a more conventional design and (b) more consistent with a well-known series of field studies. They suggest that computer-assisted simulations developed through a constructivist approach may be used to advance the discipline of strategic management.