In a the May 2008 issue of the Harvard Business Review
there was a great article that looked at the leadership benefits gained
by playing online games. The article can be bought from HBR by
following the link Leadership’s Online Labs.

It is a copyrighted piece so I am not able to post it here.
But, I have worked through the article and have placed a summary and
reflection below.

The article is written based on a collaboration between IBM and Seriosity.

Byron Reeves, Thomas Malone, Tony o’ Driscoll

Opening paragraph of article:

“Tomorrow’s business landscape
could well be alien territory for today’s business leaders. At many
companies, important decision-making will be distributed throughout the
organization to enable people to respond rapidly to change. A lot of
work will be done by global teams – partly composed of people from
outside the institution, over whom a leader has no formal authority –
that are assembled for a single project and then disbanded.
Collaboration within these geographically diverse groups will, by
necessity, occur mainly through digital rather than face-to-face
interaction.

What on earth will leadership look like in such a world – a world whose features have already begun to transform business?”

The answers can be found in games as they currently resemble this
future environment. Large communities work together with [and
against] each other in 3d virtual worlds that persist even when they
are not online. Leadership challenges are the same; recruiting,
assessing, motivating, rewarding, and retaining. These challenges
are magnified in online games as the workforce is largely volunteer
based.

IBM commissioned Seriosity
to study leadership in online games. Their subjects had a
collective 50,000 hours of experience. The study was done over
8-months. There was also a follow up survey of people at IBM who
had gaming and business knowledge – this confirmed most of the findings.

Summary of findings:
“Individuals you’d never expect to identify – and who’d never expect to
be identified – as “high potentials” for real-world management training
end up taking on significant leadership roles in games.”

“Successful leadership in online games has less to do with the
attributes of leaders than with the game environment, as created by the
developer and enhanced by the gamers themselves.”

“Furthermore, some characteristics of that environment – for
example, immediate compensation for successful completion of a project
with non-monetary incentives, such as points for commitment and game
performance – represent more than mere foreshadowing of how leadership
might evolve.”

“The startling implication: Getting the leadership environment right
may be at least as important to an organization as choosing the right
people to lead.”

Online games are not a perfect match to real-life business
challenges. In business, the stakes are higher, challenges are
less structured and defined, the leader’s focus is more on strategy and
less on tactics [it is the other way around in a game]. They draw
the conclusion that a game is more closely aligned with warfare than
modern business leadership.

Online leadership characteristics

Leadership takes speed
– an hour of game time represents a condensing of many activities that
would take up more time in real-life. “The fast pace of leadership has
some interesting consequences. For example, the need for ultraquick
decision making may occasionally trump team consensus – a tension the
leader must carefully manage because of the need to constantly motivate
people who are free to leave the team on a whim. Another implication of
speed: Decisions are nearly always based on incomplete information and
then modified as more data become available.” “To keep up with rivals,
real-world leaders will increasingly need to be willing and able to act
on such information without pausing for long periods to weigh options.
They’ll need to be comfortable with – and operate in a corporate
culture that readily accepts – modifying decisions in response to
contingencies and adopting iterative strategies marked by repeated
course corrections.”

Risk taking is encouraged
– Learning happens through trial & error. Mistakes are
frequent and are accepted as necessary toward achieving success.
Gamers don’t mind failure in the short-term, but they will not tolerate
consistent failure “No one wants to belong to a guild that always wipes
out”. “Confronting risk routinely and with a level head will be
an important leadership skill as the real-world business environment
becomes more uncertain and as success comes to depend more on
innovation than on execution. Organizations can help prepare leaders by
fostering a culture in which failure is tolerated. They can expose
leaders to risk by mimicking the structure of games, breaking down big
challenges into small projects.”

Leadership roles are often temporary
– In games leaders switch roles regularly from giving orders, to taking
them, in a short space of time. In a game, leadership is a task
not an indentity. “during the frenzied activity of a raid, the
leadership role can be transferred as conditions change or because the
person in charge doesn’t happen to be around when the need for a
decision arises. Notably, choices about who will lead and who will
follow are often made organically by the group – frequently because
someone volunteers to take over – not by some higher authority.”

The expectation that leadership is temporary has benefits and consequences.
• Leaders clearly must be – and often are – good
followers because their experience equips them to understand what the
person in charge is trying to accomplish.
• Frequent swapping of roles also helps leaders avoid burnout.

The idea of temporary leadership is not generally found in
business. Leaders are identified early in their career, and then
groomed to assume the ‘permanent’ mantle of leadership. The
growing complexity if the work environment means that it is
increasingly difficult for one person to lead in all situations – so
temporary leadership may be required.

Gaming elements to make leadership easier today

Gaming indicates that great leaders may be more a product of their
environment rather than the consequence of a genetic fluke. Based
on this fundamental finding the authors identified two environmental
factors in online games that could improve real-world leadership.

Non-Monetary incentives
– Game leaders need to be able to convince players who are essentially
volunteers to take extensive amounts of time out of their real-life to
participate in a raid or in-game challenge. Leaders are often
able to offer incentives on the spot with the incentives being either
long-term or short-term in nature. An additional source of
incentives is the loot won in a raid. Leaders are able to use
these to reward current activity, and also incentivise future activity.

Dividing up the loot provides a very clear connection between effort
& reward. Individuals are able to see in advance what they
are likely to receive at the end of the raid. Even where it is
clear that players will not get a share of the reward they know that
they are collecting points that they can use at a later stage.
Incentives are based on real-time stats that can be viewed in the game,
so their distribution is generally viewed as being fair

Organisations can learn from this by:
• Shortening the lag between effort & reward [it
isn’t about end of year bonuses, but rather reward at the end of a
successful project or task]
• These non-monetary rewards form part of a game
economy that is no less real or effective than a money-based
economy. The internal economy of a company [that a good leader
leverages] will include non-monetary elements too

Hypertransparency of information
– game environments show a broad array of information on a dashboard
that is accessible to all players, not just the leaders.
Real-time data helps the leader make strategic & tactical decisions
on the fly, as well as see which players are best positioned or adding
most value to the team in the specific task. The dashboard is
part of the game, so it allows the leader to remain in the narrative of
the game as he / she is making theses decisions. In the corporate
world, however, critical information of this nature is generally
clustered away somewhere in a head-office environment where leaders
have to make special effort to access it.

The Future?

Even if they buy into the argument that game elements can make
leadership easier, most business leaders will remain skeptical that a
business can adopt them – unless, that is, these leaders themselves
have spent time playing multiplayer online games.

IBM surveyed 135 business leaders who also happened to be members or leaders of gaming guilds.
• Most of them found their gaming experience to be relevant to their daily lives.
• Nearly half said that playing games made them
better real-life leaders, especially when it came to leading people who
weren’t under their formal authority.
• Adoption of gaming leadership styles would, however, require a change in company cultures & structures.

Concluding paragraph of article:

“Ultimately, the entire workplace
may begin to feel more gamelike – with game-inspired interfaces
becoming 3-D operating systems for serious work – which could enhance
not just leadership but all sorts of collaboration and innovation. At
the very least, digitally enabled environments and techniques could
increase productivity by making many aspects of work simpler, less
tedious, and – dare we say it? – more fun. That wouldn’t necessarily be
a bad thing.”

Byron Reeves
(reeves@stanford.edu) is the Paul C. Edwards Professor of Communication
at Stanford University and a co-founder of Seriosity, a company based
in Palo Alto, California, that develops enterprise software products
and services inspired by online games.

Thomas W. Malone
(malone@mit.edu) is the Patrick J. McGovern Professor of Management at
MIT’s Sloan School of Management in Cambridge, Massachusetts; a
Seriosity board member.

Tony O’Driscoll
(tmodrisc@ncsu.edu) is a professor of the practice of management,
innovation, and entrepreneurship at North Carolina State University’s
Jenkins Graduate School of Management and a former member of IBM’s On
Demand Learning leadership team.

Tags: gaming, leadership, serious games, business simulation, virtual leadership, gaming guilds