Role Play Simulation Manager

Negotiation Role Plays are powerful ways of exploring sales negotiation but commonly conventional role plays do not lead to win-win agreements and are financially simplistic and naive.

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Over the years I have developed several computer enhanced negotiation role plays and used them many times with sales and purchasing staff. These use simulation models to assess the (financial) outcomes of agreements and, unlike conventional negotiation role plays, lead to win-win agreements.

How Role Play Simulations Work

Each party in the negotiation has a simulation model to help them assess the impact of proposals. Each simulation model takes the same areas of agreement but produces results appropriate for them.

Learning Purpose

Role Play simulations are used to::

Learning Use

These simulations can be used

Simulation Design

This is the process by which individual teams enter their own proposals and see the outcomes. Each simulation uses the same areas of agreement (proposal) for the selling and buying groups. These are fed into business models that calculate the financial impact of the proposals and produce results for the sellers and the buyers separately (below).

Role Play simulation software structure

Negotiation Areas (Decisions)
I've found that a negotiation role play only needs six or seven areas to negotiate. For my Sales Negotiation simulation the negotiation decisions are price, total volume, shipment size, product performance (quality), payment terms, payment currency and contract duration.

Models
Although there are separate models for buyers and sellers these can be small (less than half the size of a simple traditional simulation and perhaps a sixth the size of a one-day Total Enterprise Simulation).

Results
These show the financial outcomes and are different for the sellers and the buyers and must link to the proposals. For example, for the seller, quality (product performance) impacts the cost of materials and for the buyer impacts the cost of rework and scrap. Further, payment terms will impact debtors (accounts receivable) for the sellers and creditors (accounts payable) for the buyers and through this the capital costs.

Documentation
I use the following documentation

  1. A general brief that describes the simulation, the areas of negotiation and how to use the simulator
  2. A brief for the selling group that describes their costs, results and objectives.
  3. A brief for the buying group that describes their costs, results and objectives.
  4. A Power Point Briefing

I suggest that besides financial objectives you should have strategic objectives (such as entering a new market or changing supplier).

Also, you might have a post simulation handout that explores and documents learning (covering trade-offs, negotiation behavior, team management, strategy etc.) and a set of worksheets (necessary if you cannot provide a printer for each party).

Learning Journey

The simulations involves several stages that alternated between the sellers and buyers working separately and negotiating with each other.

Stage

 

1

Familiarisation

Here the selling and buying groups work separately becoming familiar with the task, the simulator and preparing for the information gathering meeting (deciding what information they need from the other group and what information the other group might need).

2

Information
Gathering

Here the selling and buying groups meet to gather information (rather than negotiate). Here and later participants need to find the other party's objective and the relative importance to them of the areas of negotiation.

3

Prepare
Initial
Proposal

Here the selling and buying groups work separately preparing initial proposals based on the needs identified in the information gathering meeting

4

Initial
Negotiation

Here the selling and buying groups meet to make their first proposals.

5

Modify
Proposal

Here the selling and buying groups work separately

6

Final
Negotiation

Here the selling and buying groups meet to negotiate the final agreement. During this stage, participants adjourn to use the simulation model to asses the impact of a proposal.

7

Review &
Discussion

Here the all the selling and buying groups combine to discuss their

Learning Management

If possible the tutor should observe and document the face-to-face sessions (2, 4 and 6). Also, it can be helpful if these sessions are videoed. Finally at the start of the Review and Discussion stage each party should be asked if they felt that they had a win.

Meta-composition

Structurally, to ensure cognition, decisions must be chosen carefully in terms of relative importance and the ability to trade-off. I illustrate this below showing some of the decisions for my Sales Negotiation simulation.

Example of role play negotiation decisions

The diagram shows the relative importance of decisions for sellers and buyers where importance ranges from 9 (important) to 1 {unimportant). Price is important to both parties. However, although Shipment Size is important to the buyer it is unimportant for the seller. Likewise Volume is important to the seller but unimportant to the buyer. As they are both cash rich, Payment Terms are unimportant to both but Quality is reasonably important for both.

General Design Aspects

The design assumes that the user is not necessarily computer literate, should not have to waste time navigating the interface and be robustly error proof.

Proposal Entry
As participants will be entering their own proposals it is important that they do not waste time learning how to use the software. Additionally, the proposals need to be screened to prevent illegal decisions being entered and unusual or inappropriate decisions should be questioned.

On-line Context Sensitive Help
To help answer participants' questions the simulation has an on-line helps system that helps with software use, the current task or report and explains decisions and results. Optionally, a hypertext participants' manual can be made available.

Hardware Need
One computer and, ideally, a printer is required for each selling and buying group. If there printers cannot be made available and as there only a decisions and results are produced participants can be provided with worksheets to records their proposals and results.

Robustness
The simulation is fully journalised and this means (as illustrated in the Tutor's Options) it is always possible to recover to a previous period to correct for mistakes. Further, period data is saved before printing and to protect against printer problems. Finally, the decision screen traps decisions that might crash the simulation or is unusual (and hence cause business problems).

2015 Jeremy J. S. B. Hall

Most recent update: 28/07/15
Hall Marketing, Studio 11, Colman's Wharf, 45 Morris Road, London E14 6PA, ENGLAND
Phone +44 (0)20 7537 2982 E-mail
jeremyhall@simulations.co.uk