Determinants of organizational performance in a business game

Abstract

The model adopted for this theoretical-empirical research was inspired by the seminal studies of Schmalensee (1985) and Rumelt (1991) on the analysis of organizational performance based on components of variance. We examined the results of 32 organizations operating in business games producing and selling a consumer good. Even though all organizations began operations in similar economic conditions, have been totally different results from the competition based on competence. To better understand these differences were isolated factors that could explain the variability in the return on equity, the rate adopted as the dependent variable. The primary data were collected at a public University over a semester, during eight rounds of the business game. The result of statistical analysis processed by SPSS indicated that under the experimental conditions, the strategic positioning of companies explained 16.43% of the variability in performance, while the influence of the industry was only 2.11%. These results were closer to the studies of Rumelt (1991) than those of Schmalensee (1985). Besides that an additional part of the performance was explained by two combined factors reducing the residue to 45.22%, which are: 28.78% (quarter-company) and 5.29% (quarter-industry). It is recommended to conduct similar experiments to further analyze the percentage of error not explained by the model adopted here, as well as to examine the different sectors and strategic positioning observed in business games and supported by various simulators.