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Learning Business Through Scenarios

By Roger C. Schank / November 2009

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[In his latest column, Roger Schank explains how a new series of soon-to-launch, story-based business courses came to be, and outlines the content and scenarios of the seven storylines that make up the curriculum. In future columns, after the course launches, he will comment on whether they are working as planned.] — editors

About a year ago, I met a most unusual man. He had recently retired from being the CEO of Epson Europe. Some years earlier, his close friend, who was director general of a college, got sick and died. His dying wish was that his friend, the Epson CEO, would succeed him and become president of the college's business school.

And so it happened that a professional from the business world found himself in charge of the Business Engineering School at La Salle University in Barcelona, Spain.

During his years at Epson, he had hired many graduates from that college and others, and believed that the training they received there was highly theoretical, not practical enough, nor oriented to the real world of business. He believed the students needed a different kind of training in order to prepare them for professional life. He began to talk to the faculty about teaching different kinds of courses, ones that were less theoretical and more related to what people actually do in business. The faculty objected. Shocker.

A provost friend of mine once said that with faculty everything is à la carte. What he meant was that professors never feel they have to follow the wishes of the administration. They consider themselves free agents.

This former CEO, from the land where there really is someone in charge, didn't know what to do. He talked to people who talked to people and eventually he found me.

Student Efficacy
Having been a professor myself for 30 some odd years, I've developed a healthy disrespect for professors as a group. They tend to lobby for keeping their lives easy, and that means, among other things, making sure they don't have to teach too much or teach in a way that makes them have to work too hard.

Professors always have something more important to do than teach. That's not a criticism. I would have been the first to whine and wail if anyone had made me teach more than one course every other quarter. I considered myself a researcher and a graduate seminar teacher. But classes with lots of students wanting to hear a lecture? Ugh.

One reason for my attitude has to with the absurdity of it all. Undergraduates try to get grades without putting in too much work and hope to finish in four years while they party on. This is true at Stanford and Yale and Northwestern (where I've worked). I can only guess what things are like at other institutions. It was a game I didn't want to play.

I believe in learning by doing. Instructing graduate students means having them become apprentice researchers. That kind of teaching makes sense to me. Lecturing never has.

It was for this reason, in part, that I began to think about new ways of teaching in the early 1980s, and started to develop what later came to be called e-learning courses.

It was also for this reason that I became frustrated with e-learning as time went on, as they started to resemble, more and more, the very courses I was trying to eliminate. Online lectures or readings followed by tests are not my idea of education. Lectures exist so that the many can be educated by the few and universities can spend less on teachers. In an online format, it makes no sense at all.

The Making of an e-Learning Course
So, the college president and I had dinner and discussed what we could do together. I said we could build any program he wanted online as long as we didn't need the approval of faculty to do it and we had good experts available. He said he was the expert, and we needed the approval of no one. I said it would be expensive and he told me, "God would provide." Did I mention this school is run by the Christian Brothers?

Two months later, I found myself in front of 25 faculty in Barcelona as I interviewed the president about what people would have to know how to do in order to make them into someone whom he would hire. He gave me a list. The faculty got to comment, but that was about it. It was clear who was in charge.

So, we built a story-centered curriculum meant to teach practical business by creating simulated experiences.

It will be delivered online around the world, using mentors who speak the student's language. (The web site is in English.) No classes. No lectures. No tests.

We're calling it an MBA, but it doesn't have that much in common with traditional MBA programs. The idea is to help people launch their own business or go to work.

Students are part of teams that work to create deliverables within a story about a situation that demands some work on their part. They consult with their team members and use extensive background and step-by-step help that has been created as part of the web site. Mentors are available to answer questions and to evaluate the final work product .The projects are large enough that students need to divide up the work and consult with each other on how to proceed.

Eventually, they create a deliverable and either continue to improve after receiving feedback from the mentor, or move on to the next subtask in the story.

Here are the projects:

Course 1: Cash Crisis
Analyze and Solve financial Business Problems
A family who owns a winery hires a consulting firm to help it determine why the bank denied the renewal of a loan. The students, working in the role of assistant consultants, first conduct financial analyses to determine problems within the business. Next, they conduct a root cause analysis to determine the underlying causes of the problems affecting the business. Students then develop solutions to address the problems, and write a report outlining the solutions, including five-year financial projections.

Course 2: Going Online
Take a Small Business Online Students are contacted by an investor who is interested in starting an online business selling gift baskets. The investor doesn't plan to run the business—she will hire someone else to do that—but she wants the students to help her plan what the business will sell in the gift baskets and to design the web site's user interface.

The investor has already done a basic business analysis and has determined that in most cases, gift baskets command a significant mark-up on the price of the items in the baskets, and therefore are typically profitable. Therefore, she is leaving it up to the students to determine what sort of gift basket business they want to design. If they are excited about it, consumers probably will be as well, and they will likely do a better job of designing the site for it. For now, her immediate concern is seeing how the site will look and function, to make sure it will impress prospective buyers.

Students begin by interviewing prospective customers and seeing how they typically buy such items online to learn from their usage patterns, as well as find common breakdowns in the usual process. Next, students produce expected user scenarios for the "personas" they identify as being prospective users of the site. They then define functional and non-functional requirements for the site they must design. They design the information architecture, including content, sitemap, wireframes, and low-fi prototypes, after which they test their prototypes on prospective users. The final step in the process is a review of proposals from a set of vendors who could build the site.

Course 3: Marketing
Launching a New Product
In this story, the students belong to a product launching team. The goal is to launch a new social network for amateur performers called Students decide which role they want to play: product marketing or marketing communication. They work on teams of four to prepare a launch plan for this product.

The students write job descriptions for both roles and a position strategy statement, They develop a message architecture and a preliminary market segmentation for the product. They pin down the target market by deciding on demographics and psychographics. They plan a kick-off meeting and a launching program that involves determining: total product requirements, barriers to customer adoption, competitive analysis, market/customer research, which research and PR firms they will use, how they will leverage their market, communication plan, which web tools they will use, branding, market research. And finally, students prepare a budget and defend both it and the plan in front of the top management of the company.

Course 4: Supply Chain Management
Reengineering a Supply Chain
In the fourth course, students play the role of junior executives in the supply chain management department of a RightByte technologies. They receive a report from the CEO describing the current processes and its main problems. With this information, the students are requested to find out the root causes of the problems and come up with a solutions. They have to take into account the following design principles for the new solution: impact on customer service, cost savings, and ease of implementation.

From this point on, the teams will analyze each piece of the supply chain to make the deep diagnosis: supply-demand planning, transportation, warehouse management, sales order management, central order fulfillment. Once the diagnosis and requirements are well established, the teams develop a suggested solution. Finally, top management requires the team to prepare a change management evaluation to see if the company is prepared to undertake such a complex project.

Course 5: Investment Readiness
Help a small tech company raise funds for an international expansion in a second round
Next.TV is a small company that has been very successful in the local market. It has developed a software package to automate an editorial department of a television channel. Most of the main domestic channels have already implemented the package, and now the company wants to go international.

Students are hired as expert consultants to prepare the company for this second round of financing and to present the project to venture capitalists. Students do several tasks that they have already carried out in previous modules, plus some new tasks, but now they do them in an integrated manner and with much less time. For example, they analyze their starting point (P&L and balance sheet), enhance the product value proposition, prepare a sales plan, perform a management audit, prepare the internalization plan, prepare financial planning, write a business plan, identify potential VC firms to pitch, analyze offerings, and negotiate a term sheet.

Course 6: Ethics and the Law
Ethical and Legal Issues in Corporate Governance
Here students pretend they work for the government as someone who adjudicates disputes between companies and makes decisions about ethical and environmental issues. Students confront a series of cases, each of which question legal and ethical issues relevant to business, including topics such as off-shoring legal issues, labor disputes, and confronting major tech companies about privacy. Students produce decision-briefs on legal, regulatory, and ethical cases.

Course 7: Innovate
Design a New Product or Service as a Joint Venture
Students role-play that they have been hired to work as the head of a division in a multinational company. They must design a new product or service as a joint venture with another company.

Students make a presentation to the CEO, and then the board of directors, to sell their ideas. This course includes skill practice related to innovation, negotiation, and writing contracts.

We launch in January.


  • Tue, 29 Jun 2010
    Post by Susan Landay

    I just learned of a new tool out there called eActivity.

    eActivity is an online application that lets you build custom eLearning Flash activities to be inserted in whatever eLearning platform you are using. You don't need to install any software because it works off the web. Premium subscription offers 56 interactivity templates.

    Monthly subscription is $49.00/month Free 30-day trial is available

  • Wed, 16 Jun 2010
    Post by Seema Chaudhary

    This is a wonderful Quick Start Guide for people who are looking for help in sorting out diffrences and similarities between so many eLearning tools. This review has the right selection of products and also all the critical information is highlighted in a well organized fashion. This link is defintely worth forwarding to educate the trainers, presenters and teachers who are willing to transform their content to more interactive content.

  • Tue, 17 Nov 2009
    Post by roger schank

    Student fixation on content is understandable. They live a system where education means content delivery followed by a test. I am surprised however that you agree with them. Content ought to be, and is in any story centered curriculum, what is remembered long after the course is over. There is hardly as student who can pass an exam that they passed a year before (without studying for it again.) But experiences are remembered if they are interesting, emotional, and full of lessons learned about what to do next time or how to do something. If your course made students perform -- it had plenty of content.

  • Wed, 11 Nov 2009
    Post by Jyoti Bawane

    Dr. Schank, This is Jyoti Bawane, who also recently finished teaching her first online course in India to train students to be as teachers. This course was also based on scenario-based learning, which was developed under the guidance and training received from Dr.Som Naidu. The course was to enable teachers to work in networked environment and be a social change agent. We received a good response from our students, and the best part was a few were initiatlly planning to drop-out, however during the end of this course, these students reviewed their decision and gave the best presentations on the e-seminar. To be honest, my course had absolutely no content, it was all performance based, either go to the field and try out or demonstrate in a hypothetical situation. Infact, few students did complain that there was no content, i am sure these few have not realised that unconsiciously they have developed certain performance skills. i would not blame them for complaining since this is how the traditional education system functions.

    Dr. Naidu shared your work with us and iam glad to see this approach been widely accepted.

    regards jyoti