Human Resource Management Simulation: A Business Simulation Game
By Jerald Smith and Peggy Golden

2ND EDITION

This dynamic business simulation game will help the participant gain a better understanding of the strategic issues of a human resources department. For use in a college class or human resource training program, teams of 2 to 5 people establish objectives, plan their strategy, and then make the required decisions dictated by these plans. The decisions are forwarded to the instructor who uses the instructor program to calculate the results. Several iterations of the decision calculations are made. A FAQ (frequently asked questions) section for students and instructors is included in the student manual.

FYI: The last Instructor program Revision was released in November 2006. Check the date on the opening screen of your program. If you do not have the latest version, and you require your students to purchase the student manual, obtain a password from the authors and download the latest version from this site. The publisher also has a website that you may use to download the program. If you are having students use the student program to enter decisions and/or Print their results, they must use the student pass code on the inside front cover of the student manual and download their program from the publisher's website. The authors are not permitted to distribute this program to students.

You may download the latest version of the Instructor's program below, after obtaining the password from the author, Jerald Smith. When the download screen appears and you have entered the ID and password, click to "Save" and not "Open" the zip file. Save the file to your hard disk; we suggest you create a folder on your C: drive named "HumanResources." Once you have the zip file on your C: drive, then right click on the file name and select extract all files. Along with the Instructor program (HumanResources.exe), we have added 3 additional microsoft files which should have been included with Microsoft Windows© but may not be on your computer. These 3 files should remain in your "Human Resources" folder so they can be found by the program if they are needed.

ONLY instructors who have adopted the simulation and ordered student manuals may download the latest copy of the software.

Contact the author, Jerald Smith, for a password. Click here to send email to Jerald Smith.  If you do not hear from Jerald Smith within 3 days, contact the co-author Peggy Golden.


Program ID name and the required password

Use "hr" as the User Name, then enter the password we will give you (all lower case). Click Here to Download Human Resources Programs and Files


INSTRUCTOR INFORMATION

The most common Instructor error in running the simulation is to forget to run the MERGE routine (the second item on the menu). If students have submitted their decisions via the decision file created by the student program, you do not select the "Instructor Enters Decisions" on the menu as students have already entered their own decisions. Go to the "Merge decisions" selection. Then run Compute. We suggest you print the Administrator's report next to show you if there were any glowing errors in the student decision entries. The Administrator's report will also give you some information to use when you enter the "Instructor's Message to Students" which comes up in running the "Print Student Reports" routine from the menu.

 

After you are comfortable in running the simulation you may want to experiment with changing one or more parameters. We suggest changing only one or two in a quarter so students can handle the changes.

 

Students are always overwhelmed by all the rules and information they must digest during the first quarter or two. While students can use the forms to calculate budget use and how many employees to hire but if they are REALLY confused, you can help by emphasizing that they should make sure to hire the employees shown in the right hand column of the top section, "Estimated Vacancies you should fill." Please emphasize these are estimates and the actual number of employees that quit may be slightly different (this is a real world situation of the problem of forecasting employee turnover).

Note: Larry Siebers of Utah State has shared his syllabus and several forms for the simulation. The url is at the bottom of this page.


DESIGN OF THE HR SIMULATION

Teams (of from one to 5 students) in the class will be managing a medium size organization that will be competing with other teams (up to 20). The simulation can be programmed to simulate a profit or non-profit organization that is in manufacturing or service. The instructor will inform teams of the industry to be simulated. Each organization in this simulation will be managed by a team of three to five people. The organizing of the team will be left up to each team.

Teams are expected to establish objectives, plan their strategy, and then make the required decisions dictated by these plans. Decisions are submitted to the instructor periodically. These decisions are input into the computer, which produces a report for each team concerning the firm's results. This is done for several iterations (minimum for learning effect is seven, maximum 12).

OVERALL SCENARIO

The team is to assume the position of a newly appointed personnel director of an organization of approximately 660 employees. The organization has grown rapidly, and the human resource department (and functions) have not kept pace with this growth. The Chief Executive Officer (CEO) has instructed the department to get the human resource function organized and build a strong HR function. The organization may be in production or services, profit or non-profit. Currently there is no union involved, but the industry is slowly becoming unionized. At the lower levels there are both semi-skilled and skilled workers (about 500). The firm has no policy on promotions and has hired into the upper levels of management from the outside as well as promoted from within. Responsibility for training now resides primarily with department heads and is strictly on-the-job type training. The economic conditions in your region are good and unemployment rates are average.

KEY SIMULATION OBJECTIVES

The team's performance will be judged against the goals the team sets (formally or informally) in terms of the ability to manage a budget, unit labor cost, quality, morale, grievances, absenteeism, accident rate, and turnover. The team does not have enough budget to do everything that is needed in the organization. The team must make choices as to what is most important to you and concentrate the budget on those factors. The team will, in a sense, be competing with all other teams on the items mentioned above. However, in terms of direct competition, the team is only competing with other firms in the local labor market for new employees. The other firms (teams) in the class will comprise the local labor area.


DECISIONS TO BE MADE

·        Wages

·        Replacing Employees

·        Hiring

·        Promotions

·        Training Costs for Promotions

·        Fringe Benefits

·        Budget for Other Activities

·        Training Budget

·        Safety & Accident Prevention Program

·        Establish and Maintain Quality Program

·        Employee Participation Program

·        Grievance Procedure

·        Orientation Program

·        H R Information System

·        Performance Appraisal System

·        Affirmative Action Program

In addition, players may purchase survey research from the following choices:

·        Industry Average Quality

·        Morale

·        Grievances and Absenteeism

·        Industry Average and Local Comparable Wage Rates

·        Average Industry Training

·        Safety and Quality Budgets

·        Number of organizations with Employee Participation Programs

Other important HR features in the simulation

·        Turnover

·        Morale

·        Productivity

·        Production Costs including overtime

·        Relative product quality

·        Local and industry wage rates

·        Local and industry fringe benefits

·        Grievances

·        Absenteeism

·        Accident Rates

INFORMATION TO ORDER

The student manual, instructor's manual, and program disk is published by Prentice Hall, Inc.
Business Publishing Division, One Lake Street, Upper Saddle River, NJ 07458.

Potential academic adopters may contact their local Prentice Hall representative for an
adoption copy or via web page  http://www.prenhall.com/mischtm/examcopy_fe.html

Corporations or individuals interested in purchasing ten or more copies, please contact:
         Corporate Sales Department,   One Lake Street,   Upper Saddle River NJ 07458
         Email:  mailto:corpsales@prenhall.com  Voice (201) 236-7156   Fax (201) 236-7141

AUTHORS

Instructors may contact the authors via Email for questions:

Jerald Smith:  simulations@att.net

Peggy Golden:  floridapg@yahoo.com

Frequently Asked Student Questions

1.  DESCRIPTION OF VARIOUS CAUSE AND EFFECT RELATIONSHIPS 

Students (and professors) have written and asked us what decision factors affect certain outcomes, like Morale. We do not want to advise you what decisions to make so will describe how we view some of the factors in a "real world" situation. Having said that we need to warn that an outcome like employee morale is difficult to describe due to its complexity. A natural response by students will be, "but we do not have the budget to increase all the outcomes." This is true in the simulation as in the real world. Budgets are finite. That is why the authors urge the team to establish what it feels is important and concentrate on those selected factors. Other outcomes may suffer but that is to be understood.

In the list below a few rationales are given as to why a certain factor is included. The factors not specifically defined will require YOU to reason why they are a factor, and if they are a minor factor or a major factor.

Optimum Training Budget: Enough to train all promotions per the suggested amounts in the manual plus some amount above this figure to train others.

Quality: Consists of Quality budget, safety of the work environment, training budget, employee participation policy, lack of grievances, and a high regard for performance appraisals.

Productivity: Sufficient training, plant safety, employee participation in generating more efficient production function, orientation of new employees. Higher productivity is shown on the report as productivity per employee; therefore fewer employees will be needed to produce the level of production required in a given quarter. This has the effect of lowering production cost per unit.

Grievances: Presence of an effective grievance procedure, a HRIS system, employee participation (if employees participate in operations they will be less likely to file a grievance, good training.

Absenteeism: Training (workers feel they are better equipped to be promoted and to be retained should a downturn occur), safety, quality of the product produced (pride in what one is doing increases job satisfaction and willingness to be at work everyday), employee participation policy.

Accident Rate: Training, safety, employee participation, turnover.

Morale: Wages and fringes compared to other firms and to the industry as a whole, quality index (if an employee is a part of a firm that produces a high quality product, he/she should have a higher level of morale), employee participation, grievance level.

Success of minority and female hiring: As you may have noticed, just because you would like to hire a certain percentage, that percentage may be difficult to achieve. This is because ALL firms are competing for the available pool of QUALIFIED people in these groups.

We think we have given you some of the factors involved with the simulation outcomes. We encourage your team to discuss other factors which may be involved.

2. DISCHARGING EMPLOYEES

A team in Julie Zalatan's class asked would morale be affected if they discharged excess workers.
Our Answer:
Yes, it will hurt morale somewhat but if it is just a few people, morale should be back to normal within one quarter. Don't forgot, you will x number by attrition automatically (# expected vacancies next period).
However, it is also a good time to discuss social responsibility to employees. I personally would not fire any, but keep them on an extra quarter and let attrition bring it down to probably what they need. This would give the empoloyees 3 months notice, lets them begin to look for new jobs, and they can always clean up, paint up, fix up the plant or facility....or loan them out to a social servie agency while paying their salary  (e.g. like the loaned executive program in united way). The cost will increase the cost of production per unit for a quarter but it is not a hugh cost.
 

STUDENT MANUAL ADDITIONS AND CLARIFICATIONS

1. Changes are made to a student manual each time the publisher reprints the manual, mostly as a result of instructor feedback. At this time, the 7th printing (of the first edition) is the most up-to-date version. Used manuals are never the latest printing! To ascertain the version of the manual, check the series of numbers on the inside title page back cover. Just above the ISBN number about 2 inches from the bottom you will find a series that for the first printing was
10 9 8 7 6 5 4 3 2 1
As the manual is printed again, the publisher drops off the number on the right. Therefore, the 3rd
printing will read
10 9 8 7 6 5 4
We hope this will help you determine which manual you have and which manuals your bookstore is selling.

2. To clarify questions concerning the report on page 15 of the manual, it is the LAST quarter for the department. Therefore columns 1-9 at the top of the page are for that quarter, and the lst two columns are the projections for the next quarter . Therefore, the important columns for the team assuming the management of the department are columns 6 (Avail this quarter), 10 (Est Vacancies next qtr), and 11 (Total employees required next quarter).

3. Prof Paul Reagan asks "How do I correct an input error from a team's previous quarter's response?"

Start the program and select "Instructor Enters Decisions." Select the team number you want to correct in the "Company Number Box."

Enter the new decisions and save the file.
Go to the main menu and click the MERGE FILES routine, then COMPUTE. That is it!

4. A question from Professor Julie Indvik led to the creation of this example for the "Budget Planning Form-Type 2" which is in chapter 7. The numbers in this example are the actual beginning values from the student report on page 15.

BUDGET PLANNING FORM - Type 2 (modified)
 

Column> 1     2     3      4     5     6    7       8         9

      Total Less  Net Reqd for Total  # to # to   # to hire Gross

      Avail Est   No. productn number Hire promote due to   Hires

      Prev  Vacan of  this     needed              promot. (col 6

Level Qtr   cies  Emp  qtr     col 4-3)                    +col 8

----------------------------------------------------------------------------

  5    20   1    19      20      1     ___   ___a            ___

  4    25   2    23      25      2     ___   ___b    ___a    ___

  3    50   5    45      50      5     ___   ___c    ___b    ___

  2    60   6    54      60      6     ___   ___d    ___c    ___

  1    500 50   450     500     50     ___   ___d    ___     ___

Notes:
1. The purpose of the ___a   ___a (etc.) columns is to make sure the team REPLACES any employee they promote UP a level. So they simply copy the ___a in column 7 to the ___a in column 8 (etc) and that will aid in arriving at the correct number of hires.

2. While column 2 and 5 happen to be the same this quarter, in future
quarters they will not be as the "required for production" will vary in future quarters.


3. Must hire or promote sufficient number to satisfy column 5.

To finish the example:

Column> 1     2   3         4      5       6    7      8         9
      Total Less Net    Reqd for Total  # to  # to   # tohire Gross
      Avail Est  Number productn number Hire promote due to   Hires
      Prev  Vacan of     this    needed               promo  (col 6
Level Qtr   cies  Emp    qtr    (col 4-3)             tions  + col 8)
----------------------------------------------------------------------------
  5    20    1     19      20      1    _1__   _0_a            _1__
  4    25    2     23      25      2    _1__   _1_b    _0_a    _1__
  3    50    5     45      50      5    _3__   _2_c    _1_b    _4__
  2    60    6     54      60      6    _1__   _5_d    _2_c    _3__
  1    500  50    450     500     50    _50_           _5_d    _55_
Check Totals       64                                                                                                                64

Error Check: Gross hires Col 9 (64) must equal Vacancies Col 2 (64).
In this example, I decided to promote a few people and hire the balance.

The balance of the Budget Planning Form - Type 2 is to budget the total amount available to the team in a quarter. A common error (or purposeful entry) is to budget less training for promotees than the amount suggested
on page 6 (col 4). Not training those newly promoted will result in increased turnover of those promoted.

Syllabus and Forms

A SAMPLE SYLLABUS AND SIMULATION FORMS

Larry Siebers of Utah State has shared his syllabus and several forms for the simulation.

Click here for this information.

Click here to Email Authors