Latest Game Theory: Mixing Work and Play

By RACHEL EMMA SILVERMAN

Michael Sloan

Companies are trying to bring more play to the workday.

Striving to make everyday business tasks more engaging, a growing number of firms, including International Business Machines Corp. and consulting firm Deloitte Touche Tohmatsu Ltd., are incorporating elements of videogames into the workplace.

They’re deploying reward and competitive tactics commonly found in the gaming world to make tasks such as management training, data entry and brainstorming seem less like work. Employees receive points or badges for completing jobs or meeting time limits for assignments, for example. Companies also may use leaderboards, which let players view one another’s scores, to encourage friendly competition and motivate performance, experts say.

This “gamification” of the workplace, or “enterprise gamification” in tech-industry parlance, is a fast-growing business. Companies have used digital games for a number of years to help market products to consumers and build brand loyalty. What’s emerging is using games to motivate their own employees.

All Work and All Play

Examples of videogames in workplace management.

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Global consulting firm Deloitte employs digital games for its Deloitte Leadership Academy

Tech-industry research firm Gartner estimates that by 2014, some 70% of large companies will use the techniques for at least one business process. Market researcher M2 Research estimates revenue from gamification software, consulting and marketing will reach $938 million by 2014 from less than $100 million this year.

Some companies build their own games in-house. Others rely on outside firms such as San Jose, Calif.-based Bunchball Inc. and Menlo Park, Calif.-based Badgeville Inc. to “gamify” various business processes including employee training.

Business software company SAP AG employs a variety of games, including one modeled after a golf game that assigns sales leads and environmental challenges that award points for tasks like carpooling, says Mario Herger, senior innovation strategist, at SAP in Palo Alto, Calif.

SAP even turned its gamification efforts into a game, holding a series of “Gamification Cups” to generate ideas for turning various business processes into games. One recent winner turned the traditionally boring process of invoicing into a competition.

IBM uses a variety of game-like strategies throughout much of the company including video games in which users can help make a virtual city more efficient or simulate various business scenarios, says Chuck Hamilton, IBM’s virtual learning leader.

With some 400,000 employees, roughly 40% of whom work from home or on the road, gaming is a way to help colleagues connect and stay engaged, explains Mr. Hamilton.

And global consulting firm Deloitte employs digital games for its Deloitte Leadership Academy, an executive education program it uses to train clients and its own consultants.

Users receive virtual badges after completing training courses and “unlock” more complex training courses when basic levels are completed, says Frank Farrall, a partner with Deloitte in Melbourne, Australia, where its gamification initiative began last year. He says that the tools are still too new to gauge their effectiveness, but that they seem to be catching on among consultants.

“The reason why gamification is so hot is that most people’s jobs are really freaking boring,” says Gabe Zichermann, organizer of the “Gamification Summit” conference held last month in New York.

So far, the tactic has proved effective. A study last year by Traci Sitzmann, an assistant professor of management at the University of Colorado Denver Business School found that employees trained on video games learned more factual information, attained a higher skill level and retained information longer than workers who learned in less interactive environments.

LiveOps Inc., which runs virtual call centers, uses gaming to help improve the performance of its 20,000 call agents—independent contractors located all over the U.S. Starting last year, the company began awarding agents with virtual badges and points for tasks such as keeping calls brief and closing sales. Leaderboards allow the agents to compare their achievements to others.

Since the gamification system was implemented, some agents have reduced call time by 15%, and sales have improved by between 8% and 12% among certain sales agents, says Sanjay Mathur, vice president of product management at LiveOps, Santa Clara, Calif.

Still, gaming experts say there are some pitfalls for companies when implementing games internally. Companies need to make sure that the games are designed to actually reward desired behaviors and are not just doling out meaningless awards or badges.

Firms also need to make sure that friendly competition doesn’t get out of hand, fostering animosity among employees, says Byron Reeves, a professor of communication at Stanford University and a co-founder of Seriosity Inc., a firm that helps companies develop gaming strategies.

“Adding gamification to the workplace drives performance but it doesn’t make up for bad management. If you are a bad manager, gamification won’t help you,” says Kris Duggan, chief executive of game-maker Badgeville.

 

Write to Rachel Emma Silverman at rachel.silverman@wsj.com

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Posted in: Management