The perspective of a red-blue exercise participant

In 2016, I was a participant of an inter school business simulation challenge in UAE hosted by S P Jain university. It was called the “BrainSim Challenge” as it challenged student’s decision making ability in a real time computer simulated business scenario.  Decisions on pricing, advertising, marketing, allocation of resources and investment had to be made with the objective of achieving the overall maximum profit. A thought that did not occur to me at that time was how “challenge” did not necessarily mean “competition” and the possibility that cooperation could be the most important factor in winning.

As a student who has participated, and even won, in business simulations before, one element of this competition came as an unexpected surprise – our profitability depended on another teams decisions in a way that was similar to the red-blue exercise (RBE) mentioned in the article Competition and Cooperation: the Wisdom To Know When  by Roberta Wiig Berg.

RBE is a variation of the prisoner’s dilemma (Rapoport & Chammah, 1970) which believes individual prisoners base their decisions on what is best for themselves alone, not taking their fellow prisoner into consideration, leading to unfortunate results for both. On the other hand, if the prisoners cooperate, they can achieve mutually satisfactory results.

About BrainSim

BrainSim presented the current and predicted future demands, amongst other factors, of an oil industry in which two teams controlled an oil company. Although there were over 30 teams present, only one other team influenced the market that our teams business operated in. We were given a formula to help us calculate the profitability at the price point of our choice but the twist lied in the inclusion of “other teams price” as a variable in the formula. Basically, our profits depended on how close to the maximum profitability price point both teams prices were. Seemed simple enough, until you remember that only one team between the two could have the highest profits by the end of the game, which led to a reaction similar to the two teams in the article who took a more competitive approach – both our team and our paired team shamelessly tried to put the higher price to have the higher profit even if it meant significantly lowering our overall profit range (since we were the only two oil companies in the “world” oil was considered to be an inelastic good which is why we chose to increase, rather than decrease, prices).

The structure of the game was similar to RBE in which we were shown the results of our decisions as well as the decisions of the other team after each round and, after a certain number of rounds, a delegate of each team was allowed to meet at another location to discuss strategies for future rounds.

Competition or challenge?

Betrayal, revenge and unethical behaviour such as lying and deceit were just as prevalent in my experience as it was in the article in which many teams also saw the meeting as an opportunity to trick the other team. In the rounds following the meetings we only saw the overall effects on the market and could only guess the decisions the other team made and each time it was contradictory to the value we agreed on (confirmed by conversations with them after the competition). Upon this finding, our team decided to take the same approach and deceived the other team to gain a higher profit compared to theirs which only resulted in a downward spiral as both our overall profit significantly decreased in relation to the other teams markets. Funnily enough, when speaking to other teams after the competition, we realized that many other pairs of teams had a similar experience. Although Berg mentions ethics, the article fails to consider the understanding between teams after the exercise is over due to the similarity of mindsets to compete; Berg believes “Participants reveal aspects of themselves that will be remembered by their peers and that may come back to haunt them in “real” business life” but in my experience, peers were understanding of the situation and even more friendly due to the similarity of mindsets.

The instinct to compete could be explained by Berg’s conclusions which state that “we do not automatically cooperate; rather, we are programmed to be competitors”. This could be true as the competitiveness was so evident both in the RBE as well as BrainSim, but I believe that rather than it being purely deterministic, situational factors could have had a large influence since so many of us perceive inter school “challenges” as “competitions” especially when the incentive of awards is present. 1thinktwice mentions a similar perspective of how “the social system itself sets a trail for us to be a competitive being and rarely lets us learn how to be reflective and cooperative”. As a result, we did not consider the possibility of both teams being able to win by using cooperation to achieve the maximum profit since we are so used to stock market economies with several competitors, where negotiating and cooperating with other businesses would be considered as collusion.

It is true that the competitive factor of one team having a higher position than the other was present, but without “reflection”, a factor Berg mentions in the article as a thorough “if/then” analysis and consideration of possible results, we had the tendency to assume the exercise was about competition and acted accordingly.

Ever since BrainSim, the benefits of cooperation have been increasingly evident to me, even in economies such as Alicewang0108 example of the benefits of cooperation in markets to both consumers and businesses.

Overall, I believe that cooperation has not been given enough importance in education and economies which shapes the way we react in situations such as Berg’s idea of our automatic response to compete, a phenomenon I have experienced firsthand. This is an important idea to consider since cooperation can be beneficial in many scenarios, especially once the parties involved reflect on possible approaches and results.

Image credits: Illustration Thinkstock

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