The Game Developers Conference is undeniably about fun. But that doesn’t mean it’s not also about business. “Gamification” was the focus of this week’s Game IT conference, a one-day event at GDC this year. Both events featured speakers, such as New York Times best-selling author Jane McGonigal, who are exploring the use of games to get work done.

On hand to discuss the use of gaming techniques in business were representatives from IBM and Microsoft. Jennifer Michelstein, program manager at Office Labs at Microsoft, explained how the company’s flagship productivity suite got game-like.

“We looked at the most popular help pages online,” said Michelstein of Microsoft’s method for choosing what aspects of the Office Suite would receive “achievements.” These achievements are essentially rewards for the user in exchange for completing tasks in Word or reaching a milestone, such as hitting a certain number of words written.

Michelstein said that picking out which aspects of Word to attach rewards to wasn’t just about big features, it was also about encouraging users to save themselves time. “We also recognize we have hundreds of millions of users. How do we create a generalizable game that’s relevant to everyone?” she said.

“We picked features that, if everyone knew them, they’d be faster. Through a combination of what training people needed and what features we felt people should know, we narrowed that down.”

Microsoft has already introduced achievements into its Visual Studio IDE, and is rumored to be working on similar mechanisms for Windows Phone 7.
Shipping for fun
Other talks at Game IT had names like “Game Structured Hiveminds: Organizing People and Solving Problems with Fun.” And while other speakers talked about the potential of games, or discussed their thoughts on how games could change enterprises, it was Michael Hugos, an agile advisor at the Center for Systems Innovation, who demonstrated the most business-relevant game of the day.

In years past, businesses and serious games showcased at GDC have focused on gerrymandering, as in the Redistricting game, or on on-the-job training, such as with Alcoa’s forklift simulator game for its warehouse workers. Hugos, on the other hand, has taken an approach of gamifying the most essential part of any company: its supply chain.

In his talk, titled “Running Supply Chains is Like a Massively Multiplayer Online Game,” Hugos discussed his arrival at this project. “In my capacity as chief information officer for the company that delivered paper cups to Starbucks, we were challenged by our customer,” he said.

“They said every holiday they have the red cup season [where their standard coffee cups are replaced with seasonal red cups]. In years past, they’d had a lot of excess inventory they couldn’t use the following year due to design differences. We were just truck drivers and warehouse workers, but they said, ‘If you want the contract renewed, show us something that will cut excess inventory at least by half.’ They gave me 90 days.”

After discovering that every other logistics firm in the business said they could solve the problem in 18 months for at least a million dollars, Hugos decided to solve it himself.

His solution was to build a spreadsheet and to share it with the entire supply chain. This brought everyone to the table and allowed them to speak the same language, but a problem persisted: “I remembered Jane McGonigal said that a game has four traits: rules, goals, a feedback system and voluntary participation. The one thing we didn’t have was a feedback system,” he said.

“When we put together a feedback system, things started happening. We had some smart people in Seattle looking at the flow of red cups coming out of the factory and through the distribution centers. Usually, small groups of people will not make risky decisions as quickly as they should because they don’t want to get blamed. They would tell us three days before Atlanta ran out of cups, and we had an excess in New York City. How do you move them from New York to Atlanta in two days? You fly them, and that’s a huge loss.”

Hugos said that the feedback system, combined with data from all sides of the supply chain, gave his firm a full view of what was really happening in the chain. “When we convened for our conference calls, we’re all looking at the data, and as we started talking, a whole group of us talked about things and we’d make decisions faster, because no one person could get blamed. Do not play this game with bureaucrats. We were street-smart pros with a stake in the outcome.”
Solving the supply chain
This led to the introduction of gamification into the process. Hugos’ team was told by its client that they needed to have a perfect order rate at the 90% level. Traditionally, he said, it’s tough to keep perfect order rates above 85%. (A perfect order is one that arrives on time, with exactly what’s needed, no more, no less.)

So, Hugos and his team added a rating system to every stop in the chain in its relevant spreadsheet entry. Sites above 90% got a happy face, above 80% got an indifferent face, and below 80% got an angry face.

Immediately, said Hugos, all of the sites in the supply chain began to fight to get better ratings. No one cared if they were the best, he said, but no one wanted to be the worst. The introduction of rewards based on performance ratings was enough to get everyone in the chain to improve their performance.

Thus, Hugos left the supply and delivery company. At the Center for Systems Innovation, he has constructed an actual game around this idea. It’s overlaid on Google Maps, and it allows users to place warehouses and factories, and to use real roads for route planning.

Hugos’ supply-chain game—named SCM Globe—isn’t about beating tricky scenarios or taking on challenging puzzle-style supply-chain problems. Instead, it’s about laying out your actual supply chain on a map of the real world, and then allowing a simulation to run on top of that layout.

The simulation, said Hugos, gives businesses the first chance they’ve ever had to actually visualize their supply chains, and to test their reactions to events. For example, an earthquake in Japan could halt all shipments of parts through the chain. He said it is valuable for businesses to be able to simulate their supply chains in a computer environment, as it allows them to test their planned reactions to chain disruptions.

“If ever there was a massively multiplayer online role playing game in business, it is supply chains,” he said. “A lot of times, we forget about supply chains. We talk about what’s happening in individual companies. Supply chains are a whole bunch of different companies. They all have their own agendas. They all have their own profit and loss, and yet none can succeed without the others.”