Journal of Management

Education
http://jme.sagepub.com/

The Magnetic Sentences Industry Game: A Competitive In-Class Experience of Business-Level Strategy
Maureen Casile and Jane V. Wheeler
Journal of Management Education 2005 29: 696
DOI: 10.1177/1052562905277315
The online version of this article can be found at:
http://jme.sagepub.com/content/29/5/696

Published by:
http://www.sagepublications.com

On behalf of:

OBTS Teaching Society for Management Educators

Additional services and information for Journal of Management Education can be found at:
Email Alerts: http://jme.sagepub.com/cgi/alerts
Subscriptions: http://jme.sagepub.com/subscriptions
Reprints: http://www.sagepub.com/journalsReprints.nav
Permissions: http://www.sagepub.com/journalsPermissions.nav
Citations: http://jme.sagepub.com/content/29/5/696.refs.html

>> Version of Record - Aug 30, 2005

What is This?

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

JOURNAL
10.1177/1052562905277315
Casile,
Wheeler
OF MAN
/ MAAGEMENT
GNETIC SENTENCES
EDUCATIONINDUSTR
/ OctoberY2005
GAME

THE MAGNETIC SENTENCES

INDUSTRY GAME: A COMPETITIVE
IN-CLASS EXPERIENCE OF
BUSINESS-LEVEL STRATEGY

Maureen Casile
Jane V. Wheeler
Bowling Green State University
The Magnetic Sentences Industry Game is a high-energy in-class exercise
designed to help students gain hands-on experience with setting, implementing, evaluating, and revising business-level strategy. Students compete in
teams to create and market sentences using Magnetic Poetry (a product of
Magnetic Poetry, Inc.). Revenues earned are highly dependent on the successful development and implementation of a cohesive business-level strategy. The
game experience should create opportunities for the class to discuss a variety
of strategic issues including external environment, internal environment, competitive dynamics, the advantages and disadvantages of various generic business-level strategies, organizational learning, and strategic groups.
Keywords: business-level strategy; differentiation; low-cost leadership; inclass exercise; Magnetic Poetry

Increasingly, employers are demanding that college graduates have integrative skills (Stephen, Parente, & Brown, 2002) and an interdisciplinary
understanding of the organization (Hartenian, Schellenger, & Frederickson,
2001). These qualities are necessary to help organizations achieve the timely,
yet broad-based decision making and problem solving that they need to
Authors Note: Please direct all correspondence regarding this article to Maureen Casile,
Department of Management, College of Business Administration, Bowling Green State University, Bowling Green, OH 43403; e-mail: mcasile@cba.bgsu.edu
JOURNAL OF MANAGEMENT EDUCATION, Vol. 29 No. 5, October 2005 696-713
DOI: 10.1177/1052562905277315
2005 Organizational Behavior Teaching Society

696

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

Casile, Wheeler / MAGNETIC SENTENCES INDUSTRY GAME

697

compete (Hartenian et al., 2001). They are also critical building blocks for a
learning organization (Dumaine, 1994), that is, an orientation in which the
acquisition of skill and knowledge, and the sharing of these across the organization, are continuous (Kieman, 1993; Quinn, 1992). Yet employees generally maintain an affinity with their functional background, remaining socalled experts in their chosen field (Hartenian et al., 2001).
Business schools have begun to respond to industrys demand for employees who can span professional boundaries but only slowly (Hartenian et al.,
2001; Mosca & Howard, 1997). The delay in this response has been costly for
business schools, causing recruiters to disregard much of a students education, placing far more emphasis on his or her work-related experiences
(Employer Survey, 1995). In addition, other sources of employee training,
such as suppliers and consultants, have displaced 4-year colleges and universities as providers of employee training (Employer Survey, 1995). What is
needed to close the gap between employer needs and business-school offerings are learning experiences that integrate concepts from the different functional areas of the business school (Hartenian et al., 2001). Of equal importance, these experiences should involve what Mosca and Howard (1997)
called grounded learning, that is, learning inductively from interactive
involvement with the phenomena to be studied. In other words, the Magnetic
Sentences Industry Game (the Game) provides a learning experience about
business-level strategy in which students are active participants.
The Game is designed for use in a capstone undergraduate course in business strategy. It is intended to draw on a variety of skills and acquired knowledge and to provide a highly interactive learning experience about the formation, implementation, evaluation, and adjustment of business-level strategy.
The Game is similar to the popular Words-in-Sentences Company Exercise
(as found in the text by Bowen, Lewicki, Hall, & Hall, 1996) in that students
compete with one another in groups that represent organizations. However,
the Game does not emphasize organizational structure as the Words-inSentences Company Exercise does. Rather, a small group of students (generally from three to five) is charged with acting as a top management team.
Their charge is to evaluate the internal and external environments of the organization and to make and implement strategic decisions accordingly. Information about the external environment comes in a rather complicated set of
instructions (Appendix A). To this the students must add knowledge of the
respective strengths and weaknesses of the members of the group to determine what core competencies they may be able to parlay into competitive
advantage. At the beginning of the game, some differences in team capabilities and resources will be inevitable. Some teams will have persons strong in

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

698

JOURNAL OF MANAGEMENT EDUCATION / October 2005

grammatical or game-playing ability while others are weak. Some teams may
organize well and quickly while others take more time to work out their relationships. Some teams may try to enhance their internal capabilities by bringing in definitions and even examples of prepositional phrases downloaded
from the Web. These attempts should be viewed as personal initiative and,
therefore, a legitimate source of potential competitive advantage for the firm.
Finally, the teams must choose and implement a business-level strategy. The
Game is designed to offer four of the five strategic options from Porters
generic strategy model (Porter, 1998). The four strategic options represented
within the game are cost leadership, differentiation, focused cost leadership,
and focused differentiation. The game does not accommodate Porters
(1998) integrated business-level strategy.

Overview of the Exercise

Time: The exercise should be conducted over two to three 50-min class periods.
When to Introduce: The Game should be introduced after the class has discussed the external environment (general and industry environments), the
internal environment (resources, capabilities, core competencies, and competitive advantage), and Porters generic business-level strategies (Porter,
1998). Depending on the text and syllabus used, this will often place the
exercise between one third and one half of the way through the course.
Issues such as corporate-level strategy, innovation, globalization, and corporate governance need not be introduced prior to the Game.
Objective: The objective of the Game is to develop and implement a strategy for
maximizing revenue by efficiently producing sentences and selling them at the
highest possible market prices.
Team Size: Students play the Game in Top Management teams. Team size may
vary, however historically teams of three to five top managers have worked
best. It is helpful for all teams to be as close in size as possible since the exercise
is quite labor intensive.
Required materials:
 Game instructions (Appendix AThese are distributed and read prior to
class time and brought to class on game day)
 Magnetic Poetry (a product of Magnetic Poetry Inc., www. magneticpoetry
.com) (one per team)
 large metallic cookie sheet (one per team)
 Sentence Tally Worksheet (Appendix B) (one per team)
 Magnetic Sentences Industry Score Sheet (a multipart Excel Spreadsheet
available from the authors) (one per class)
Stage 1: Strategy formation: As previously stated, the game instructions should be
handed out and read by students prior to the first game day. Before the distribution of any other materials, teams should be given 15 min to devise and document
a business-level strategy for winning the game. The winner of each round of the
game is the team that earns the most revenue from sales of its completed

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

Casile, Wheeler / MAGNETIC SENTENCES INDUSTRY GAME

699

sentences. The game is designed to offer students a variety of choices of business-level strategies. For example:
 Cost leadership strategy: A team could choose to make and sell a large volume of short (three to six word) sentences. These sentences take less time
and fewer words to make and so can be equated during the processing phase
to a cost leadership strategy. They also sell for relatively low prices as noted
in Appendix A.
 Differentiation strategy: A team could choose to make and sell long sentences (10 words or more). These take considerably more time to make than
shorter sentences and require greater coordination among group members.
They also use up more of the firms limited supply of words and syllables.
However, the game is designed so that consumers are willing to pay for this
value added, and so these sentences sell for considerably more than short
sentences do.
 Focused strategy: A team could choose to market sentences of any length to
one or more of three specialty markets. The three specialty markets are purchasers specifically interested in
 Commands (e.g., Sit down here. and Go to the store.)
 Questions (e.g., Is that you? and Are we there yet?)
 Sentences including prepositional phrases. (e.g., He is [around the corner]. and They went [to the movie] [with Rob].)

There are additional rewards for carving out a market niche in a specialty
market. However, to sell in a specialty market, the team must establish a reputation in that market by producing at least 10 marketable sentences for that
market within the round. This constraint can be used in the processing phase
to illustrate the fact that significant resources must be devoted to this strategy.
In particular, a decision to pursue a focused strategy may force the firm to
forego other opportunities because of the investment of time, words, and
organization required to achieve a reputation in the specialty market.
In the strategy formation stage, teams must also consider the prospect of
selling in a hypercompetitive market. This is operationalized in the game as a
market glut, which occurs when too many companies pursue a specific strategy. Any market, focused or general, except the 10-and-up-word so-called
luxury market, may be thrown into glut. In the event of glut, sentences must
be sold at a greatly reduced price. During the discussion phase, the glut can be
used to exemplify why it is important to locate a profitable market niche.
Stage 2: Implementation: After the 15-min planning phase, the instructor should
request one representative from each team to come to the front of the class to
collect one set of Magnetic Poetry magnetized words and one metallic cookie
sheet. The teams will then have 25 min to implement the strategies they have
set for themselves. At the end of the 25-min production run, the instructor
should give each team only 30 sec to send a representative to the instructors
station with the following materials:

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

700

JOURNAL OF MANAGEMENT EDUCATION / October 2005

 the cookie sheet containing all completed sentences

 A sheet of paper identifying the group and any specialty markets for which it
hopes to qualify.
Tabulation of results: A major weakness of the Game is the tabulation of results.
The job is tedious and time-consuming. However, it is useful to do a thorough
tabulation, particularly if the class will be playing two rounds. This will enable
the instructor to evaluate shifts in strategy in response to either success or failure. Getting assistance from one or more graduate assistants is strongly recommended. If classes meet back-to-back, the instructor should have enough sets
of materials on hands to accommodate both classes. As a general rule, the
instructor should leave at least 1 hr to record results for one class prior to recycling the materials for another class. Tabulation of results should proceed as
follows:
 Record results: Group sentences by team and intended specialty market if
any.
 Conduct quality review: Review all sentences to ensure that they meet all
requirements in the instructions (Appendix A). Delete sentences or move to
general markets as specified in the instructions (Appendix A). Note beside
each rejected sentence the reason for rejection so that teams will have adequate feedback and will be able to respond if there is a second round.
 Count words, sentences, and prepositional phrases: Appendix B is provided
to help with the count.
 Enter counts on the Magnetic sentences industry Score Sheet: The score
sheet links information for all teams in a class and automatically determines
whether there is a glut in each market. Glut and nonglut revenues are calculated and totaled with only minimal manipulation by the instructor.
 Make results and feedback available to students: If the class has a Web page,
the entire score sheet can be posted to this page. This is particularly useful if
there is to be a second round. It helps students scope out the competition and
identify markets that are underserved. Numeric scores and quality review
results for sentences should be given to students. However, quality review
results should be provided only to the individual teams rather than to the
entire class.
One round or two?: Although one round of play should provide sufficient fuel for
discussion of major course concepts (internal environment, external environment, and business-level strategy), two or more rounds are recommended for
several reasons. Perhaps the best reason to include a second round is to give the
students a sense of closure. Students generally feel that they have learned much
from the first round, about the game and about strategy. A second round can
give them a chance to test their newfound knowledge. Students are also generally more energized for a second round, perhaps because they believe the challenge of mastering the technical aspects of the game is behind them. In addition, from an instructional point of view, a second run can provide additional
fuel for discussion. The following examples suggest some of the issues that a
second round might open up for discussion.
1. Strategic flexibility: In a second round of play, a group may choose to alter
its strategy in view of new, or newly discovered environmental circumstances. For example, because of illness, one team of three had only two

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

Casile, Wheeler / MAGNETIC SENTENCES INDUSTRY GAME

701

members in Round 2. They revised their strategy to compensate for the labor shortage. Specifically, they changed from a strategy of producing longer (differentiated) sentences in Round 1 to one of producing many small
(low-cost) sentences in Round 2. As a result of this adjustment, their revenues dropped by only 6% even though their labor force had declined by one
third.
2. The risks of strategic change: Although strategic flexibility can produce strong
competitive advantages, a willingness to change strategy to follow every
fad can have the opposite effect in the Game just as it can in real life. For example, if many teams choose cost leadership or focused cost-leadership
strategies, it is likely that one or more markets will go into glut. If this happens in Round 1, then it is likely in Round 2 that these teams will either
switch to a differentiation strategy or target a market that did not go into glut
in Round 1. If, in Round 2, many teams target the one or two markets that
did not experience gluts in Round 1, then these markets are likely to experience gluts in Round 2. A differentiation strategy is a good way to avoid gluts
in this game. However, if the team lacks the internal capabilities to pursue
this strategy, this strategy will probably not be very successful for them.
3. Risks because of changing consumer tastes: This is a risk for any businesslevel strategy but is particularly salient to firms pursuing a differentiation
strategy (e.g., Calvin Klein jeans) or a focused strategy (e.g., boy bands targeted specifically to the teen girl market). Payout rates and glut levels may
be altered in Round 2 to reflect changes in consumer tastes. For example, an
imaginary recession similar to the actual one that began in 2000 could reduce consumer demand for high-end sentences and make it possible for
these to go into glut. At the same time, discounters (such as Wal-Mart and
Southwest Airlines) might not suffer as much as their high-end competitors). In the Game, this would equate to higher payments for short sentences
and lower payments for longer sentences. Or it could be operationalized by
raising the glut ceiling for short sentences and creating one for long sentences. In addition, some focused markets could be eliminated or made less
attractive while others might be created due to changing consumer tastes.
Questions students may ask during the exercise:
Q: What is a preposition?
A: If you have to ask that question, you should probably evaluate your internal
environment to help you decide in which markets you can compete
successfully.
Q: Can we compete in more than one specialty market?
A: Yes, this can be done and has been done. However, you need to manage your
resources carefully to achieve it.
Q: May we ask other teams which markets they are going for?
A: Yes, but they are not required to tell you the truth.
Q: Can we sabotage other teams?
A: What did you have in mind? (Note: Destroying the outputs or raw materials of
other teams is illegal. However, one team discovered a form of legal sabotage
by creating sentences for their true target market while simultaneously creating a large number of very small sentences in other markets to throw those markets into glut. This same team also chose to work very loudly. Most teams work

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

702

JOURNAL OF MANAGEMENT EDUCATION / October 2005

quietly to avoid espionage by competitors. However, the members of this team

stated that they worked loudly to distract competitors. This form of sabotage is
not only legal but also can be compared during the processing phase to companies trying to throw off competitors with press releases and the timing of new
product introductions.)
Processing the exercise: There is much to be said for watching the competition
unfold and drawing discussion questions from those observations. Although
tedious, the experience of tabulating results can also help the instructor get a
feel for what happened and what would make for good classroom conversation. The following is a list of possible topics and sample questions for debriefing. The instructor should pick and choose from these as the experience of a
particular class dictates.
1. Issues to consider in forming and revising a business-level strategy. Examples include
Internal environment:
(a) I noticed you downloaded a list of prepositions and brought it to class
today. Why? (This was most likely an attempt to develop a capability
within the group that would hopefully be more difficult to imitate than a
capability for making questions or commands).
(b) I noticed that Team 4 had some members creating sentences and others
in charge of lengthening sentences. What was your teams strategy, and
how well did this tactic help you achieve it?
(c) No one entered the prepositional phrases market this time, although
Team 1 fell short by only one sentence. Team 1, if we were to play
another round, would you make another attempt to gain a reputation in
the prepositional phrases market? (This question attempts to get students thinking about learning curves and the value of doing something
that is difficult to do.)
External environment:
(d) Why did you believe the market you chose was less likely to go into glut
than some of the others? (Questions such as these usually prompt students to share their assumptions about the mindsets and abilities of
competitors)
(e) If we were to play another round, would you continue to pursue the same
market or go into another one? (Again, this question is intended to provoke thinking about the mindsets of competitors and their likely
actions)
2. Advantages and disadvantages of various business-level strategies: For
example:
(a) Teams that pursue a cost-leadership strategy are more likely to find
themselves selling at reduced prices in glutted markets. In addition, cost
leaders must generate considerable volume to compete with firms that
choose other strategies.
(b) A differentiation strategy, although it offers high margins, is difficult to
achieve with the materials available and the time constraints of the production run.
(c) Teams that attempt a focused strategy may fail to focus sufficiently and,
therefore, fail to gain a reputation with the target customer group. This is

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

Casile, Wheeler / MAGNETIC SENTENCES INDUSTRY GAME

703

as close as the game can come in one round to the real-life risk of being
out-focused by a competitor.
3. The importance of having an overarching strategy to help direct effort and
functional-level decision making: The instructor might begin by asking
something such as What was your groups strategy going into the production run? While many groups develop fairly specific strategies and means
for implementing them, some will generally start out with a fairly general
strategy. For example, a team might answer the question above by simply
stating just to make as many sentences as we could. With this latter type
of group in particular, it is helpful to ask how they would change their strategy if another round were played. This question also works well with
groups that abandoned their initial strategy during the production run. After
students have had a chance to consider the strategies of their specific
groups, the instructor can ask if they perceive a value to having a strategy
for this exercise and, if so, what is that value. Students can generally see at
this point that an unclear strategy reduces their ability to exploit the design
of the game and their natural abilities to earn above-average returns.
4. The need for strategic flexibility as implementation issues (e.g., availability
of raw materials, time constraints, or skill of workforce) arise: Particularly
salient in Round 1, since the strategy session occurs before teams have examined the Magnetic Poetry Words and syllables, students often find that
managing the raw materials (words, letters, and syllables) is difficult and
central to their success. During the production run, they may begin to develop coordinating mechanisms to help one another find words. If the instructor observes this type of behavior during the production run, he might
ask a series of questions such as the following:
(a) Was it more difficult than you anticipated finding words you could use?
(b) How did you cope with this obstacle?
(c) What changes did you make to your strategy or to your tactics when you
ran into this problem?
5. How different strategic groups can coexist within the same industry: The
instructor can do this by identifying two or more teams with similar scores
but very different strategies. For example, one team may have excelled in
the prepositions market because they correctly predicted that few others
would successfully enter it. Another team may have achieved a high score
by pursuing another specialty market or the high-end market.

Variations
Having students evaluate and tally outputs: The Game is designed to fit into a 50min class time frame. However, if the instructor has the luxury of a longer time
frame, she or he may choose to have students do their own quality control and
tallying of scores. To do this, the instructor should call time and have a representative of each group bring to the front of the class the results and the sheet of
paper identifying specialty markets targeted as in the shorter version of the
game. The instructor should then instruct the representatives to exchange cookie
sheets and conduct quality control review for one another. The instructor

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

704

JOURNAL OF MANAGEMENT EDUCATION / October 2005

should also provide students with tally sheets to complete. Using the completed tally sheet, the instructor can quickly enter data to the computerized
score sheet.

There are several disadvantages to having students evaluate one anothers

work. First, there is no guarantee that the quality control representative in
charge of a given groups output will understand the specialty market well
enough to evaluate the output for that market. This is particularly problematic with the prepositional phrases market. Having students evaluate one
anothers work may also lead to considerable variability on how far the rules
are stretched in evaluating output. This could lead to justified skepticism on
the part of participants about how accurate the game results are. Finally,
when students evaluate and tally one anothers work, no permanent record of
sentences is made prior to recycling the materials. This will reduce the information that the instructor has to draw on when determining how best to process the exercise. For example, the numerical score alone will not show for
which specialty markets a group tried but failed to achieve a reputation. Nor
will it show by how much a group failed. Without this information, it will be
impossible for the instructor to determine whether the group changed strategy or persisted with new tactics in a second round.
One clear advantage of having students evaluate and tally one anothers
work is that it can save a great deal of time for the instructor. In addition,
while one member of each group is serving as quality control coordinator, the
other members of the group can be instructed to review the results of the
round and plan revisions to their strategy and tactics. Admittedly, these discussions will be only preliminary because groups will still be waiting to learn
which markets went into glut. However, it is a good opportunity for groups to
document their learning process before it is forgotten in the next round. In a
sufficiently long class period (75 to 90 min), it may be possible with the student quality-control option to provide immediate feedback to the groups
about which markets went into glut and which did not, as well as team scores
and rankings from the round. This option is particularly desirable in longer
classes (2 to 3 hr in duration) because it will enable the instructor to conduct
two rounds in one class period. It is not advisable to conduct a second round
before students know the results of the first round. Students should also be
given time after results are known to revise their strategy and tactics and to
record these changes for use in the processing phase of the exercise.
Extrinsic motivators: Students who fare well in the Game often ask what their
reward will be. To date, the exercise has never been administered for a grade or
for any other extrinsic reward. The game relies on students natural drive to
compete, and their sense of accomplishment at creating really cool sentences

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

Casile, Wheeler / MAGNETIC SENTENCES INDUSTRY GAME

705

as sources of intrinsic motivation. Generally, these have been enough to generate considerable enthusiasm for the exercise. As one student stated during the
second round of play Were on flames here!

Students do receive participation credit during the processing phase of the

exercise for drawing links between the game experience and the strategic
concepts it is intended to represent. It might be interesting to compare game
effort and performance between graded and nongraded administrations.
However, there are some issues to be considered if the exercise is to be
graded. First, students may well consider it unjust to grade them on an exercise that favors those with a strong command of English grammar. This may
be particularly true in a class where many students have learned English as a
second language, or where there is considerable variability in the quality of
K-12 educations. In addition, the application of extrinsic rewards may actually quell intrinsic motivation (Deci, 1972).
One form of reward that seems to stoke rather than suppress intrinsic motivation is recognition. When scores are announced, the instructor does not
praise winning teams or rebuke those that did not do well. He or she may
check in privately with poorly performing teams to see if they need help or a
further explanation of the requirements of the game. However, students seem
to respond well receiving samples of the more unique and interesting sentences that were created in the previous round. For example, in a recent iteration of the game, some teams received notoriety for the following sentences:
Most piratey sounding sentence: Beat and pound his head on top of a ship! so
screams bloody death. Group 3
Most likely to replace live long and prosper as the Vulcan greeting: Soar
smoothly through eternity and have no sad sleepless days. Group 13
Best melodrama: Leave these delirious visions of his love at my death. Group 14
Best gossip: Do you see him deliriously whispering to his shadow? Group 4
Best accusation: Did you drool deliriously in his hair? Group 8.
Trashy but poetic: Some essential needs for woman let man dream and sweat.
Group 5; and When goddess screams like bloody hot lust, I will say, Live!
Group 5

These acknowledgments were delivered via a document posted to the course

Web page at the end of two rounds. However, in the future, they will be delivered at the end of each round orally in class so that the class can appreciate
them together. They will have to be offered with a disclaimer, however, as
many of the sentences, without using foul language, still manage to conjure
up pornographic or violent images. Most students find these amusing; however, it is possible for someone to be offended by them.

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

706

JOURNAL OF MANAGEMENT EDUCATION / October 2005

Benefits of the Magnetic Sentences Industry Exercise

Recognizing the importance of strategy: The Game helps students see the importance of having and following a cohesive organizational strategy. The teams
must coordinate their efforts to gain maximum rewards. Stellar individual performances, even stellar group performances, are not rewarded well by the
game unless there is an overarching strategy behind them.
Firsthand experience with strategic thinking in a relatively short time frame: The
Game helps students move from operational thinking to strategic thinking by
mandating a strategy session prior to each round of the game. During these
strategy sessions, raw materials are not available, and the instructions (Appendix A) give the team guidance as to the kinds of issues they should be tackling
in these sessions.
Experience-based opportunities to discuss strategy formation: The Game provides a basis for discussion of three important strategic concepts. First, students must consider factors in the external environment including markets,
rules, prices, gluts, and competitors. They must also consider internal factors
such as labor, raw materials, time, knowledge, skill, and core competencies
that may be stored in cross-functional capabilities. Finally, given their assessment of these factors in the internal and external environments, students must
consider which business-level strategy(ies) are likely to work best for them.
Process observation and processing flexibility: During planning sessions and production runs, the instructor is free to move about the room and observe.
Observed behaviors and statements may be recalled during processing of the
exercise to demonstrate a correlation between the Game experience and course
concepts. For example, depending on the instructors observations of students
experiences with the game, he or she may identify good opportunities for discussing additional course concepts such as competitive dynamics, strategic
flexibility, and organizational learning as they contribute to the development of
sustainable competitive advantage.
A high-energy hands-on experience: The Game is a very kinesthetic learning
experience. It involves a great deal of manual manipulation and requires students to move chairs, desks, or whatever they can move to set up a team work
station. Students have a lot of fun playing the Game. Although they generally
start out quiet, there is considerably more laughter and joking as the game
wears on, and they become more creative in their sentence making. Coming
relatively early in the course, it is a good icebreaker to help students meet and
get to know one another by working together. Students also begin to enjoy the
sentences they create. Although the rules require that sentences make sense,
this rule is generally stretched to accept any sentence that could make sense in
some context.

Limitations of the Game

Integrated business-level strategy: The Game forces teams to choose between cost
leadership and differentiation strategies. There is no option in the game that
accurately represents an integrated business-level strategy.

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

Casile, Wheeler / MAGNETIC SENTENCES INDUSTRY GAME

707

Class time required: The exercise cannot be successfully administered and processed in one regular class period. Two to three sessions are the minimum to
run and process the exercise.
Level of complexity and realism: Although the Game is a simulation, it is a highly
simplified one. It is not intended to replace more complex Web-based business
simulations that can run for part or all of the semester as part of a Business
Strategy course. Rather the exercise is designed to provide insight and handson experience with a few fundamental aspects of business-level strategy.
Relating the game experience to strategic concepts: While some students can easily discern which game options represent a cost leadership strategy, a differentiation strategy, and a focused strategy, others need help to do so. Therefore, it
is important to begin processing the exercise at a fairly basic level before moving into nuances such as how a strategy was chosen or revised.

Conclusion
The Game is an active and competitive exercise. It creates an enjoyable
and personal experience of setting and implementing business-level strategy,
even for students with little or no real-world business experience. To succeed
at the Game, teams must accurately assess their own skills and respond to
complexity, uncertainty, and dynamism in the external environment. To successfully process the Game, an instructor must show students how their personal experiences with the game reflect the challenges faced by top managers
in real-world organizations as they attempt to set, implement, evaluate, and
revise business-level strategy.

Appendix A
Instructions for Playing The Magnetic Sentences Industry
Game (50-Min Class Format)
Today you will develop a strategy for, and operate, a company in the Magnetic
Sentences Industry. Your raw materials are 440 words and syllables provided by the
instructor. You will not lose or misplace a single one of these objects. You will arrange
the words on the cookie sheets provided into English language sentences. These sentences will be the finished products that you will then sell in the market at the prices
listed below.
All sentences must make sense and must be grammatically correct.
Your goal in this exercise will be to develop a business-level strategy that will
enable you to maximize revenue for the first period and to revise your strategy as
appropriate to maximize revenue for the second period as well.
Beyond the 440 words and syllables that are allocated to you, no additional raw
materials will be provided.

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

708

JOURNAL OF MANAGEMENT EDUCATION / October 2005

MARKET PRICES
Unless there is a glut (as discussed below under that subheading), your finished
products will sell out on the market at the following prices:
 Any sentence of 3 to 6 words will sell for $7 per word.
 Any sentence of 7 to 9 words will sell for $8 per word.
 Any sentence of 10 or more words will sell for $9 per word.
 There is no market for sentences of fewer than 3 words.
GLUT
If the industry average of 3-to-6-word sentences produced exceeds 5 per company,
there will be a glut in that segment of the market. In that case, your finished product
inventory will sell for $4 per word instead of the customary $7.
If the industry average of 7-to-9-word sentences produced exceeds 4 per company,
there will be a glut in that segment of the market. In that case, your finished product
inventory will sell for $5 per word instead of the customary $8.
Historically, there has never been a glut in the 10+-word luxury market.
Please note that producers that hold a recognized market position in one or more of
the specialty markets can continue to sell in these specialty markets at regular prices
unless a glut also occurs in that market.
SPECIALTY MARKETS
Although nearly everyone needs magnetic sentences of all kinds, three distinct
groups of consumers are especially interested in specific sentence types. These consumer groups are considered specialty markets. These three specialty markets are discussed below. A company cannot sell product in a specialty market unless it has an
established reputation in that market. To establish a reputation and sell in a selected
market, an organization must produce 10 or more sentences that are appropriate to the
category within the period. If fewer than 10 sentences are produced in a given specialty market, then these sentences must be sold on the general market and not to the
specialty consumer group.
SPECIALTY MARKET #1: COMMANDS
A number of military and paramilitary organizations purchase command sentences in bulk from recognized suppliers. A command sentence must be directive in
the sense that it tells someone to do something. Examples are:
John, go to the store.
Get out of here and dont come back.
Watch out for trucks.

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

Casile, Wheeler / MAGNETIC SENTENCES INDUSTRY GAME

709

If you can establish a reputation in this market by producing 10 or more command

sentences in the period, you can sell them at regular market prices plus $10 per sentence.
A glut will occur in the command market if the industry average of sentences produced per firm exceeds 4. If a glut occurs, no premium will be paid for these sentences
and they will sell for $4 per word for 3-to-6-word sentences and $5 per word for 7-to9-word sentences.
SPECIALTY MARKET #2: QUESTIONS
Scientists are always looking for good questions to investigate. If you can produce
10 or more sentences in the form of a question, you can sell them in this specialty market. Sentences sell at regular market prices plus $10 per sentence.
A glut will occur in the question market if the industry average of sentences produced per firm exceeds 4. If a glut occurs, no premium will be paid and sentences will
sell for $4 per word for 3-6 word sentences and $5 per word for 7-9 word sentences.
SPECIALTY MARKET #3: SENTENCES
CONTAINING PREPOSITIONAL PHRASES
Members of the High IQ club, Mensa, are always looking for sentences that make
them sound intelligent. They particularly like sentences that contain prepositional
phrases. If you can establish your company in this market (by producing 10 or more
sentences containing prepositional phrases), they pay a $10 premium per prepositional phrase, even if theres more than one in a sentence.
A glut will occur in the prepositional phrase market if the industry average of sentences produced per firm exceeds 4. If a glut occurs, no premium will be paid for these
sentences and they will sell for $4 per word for 3-to-6-word sentences and $5 per word
for 7-to-9-word sentences.
Quality Control
Punctuation may be assumed as long as the wording would work with appropriate
punctuation.
A group may sell in more than one specialty market during a production run as
long as they qualify (by producing 10 or more sentences) in both markets. No sentence can be sold more than once. Therefore, should the group produce a sentence that
is a question and includes a prepositional phrase, the group will have to specify when
handing in their outputs in which market this sentence is intended to be sold.
At the end of the production period, one representative from each company will
bring forward his or her companys output. At this time, the representative must also
provide the following information in writing along with his or her output:
1. name of group member to be contacted with production run results
2. number on the groups box of raw materials and cookie sheet (should be the
same)

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

710

JOURNAL OF MANAGEMENT EDUCATION / October 2005

3. Specialty markets (if any) in which the group intends for its outputs to be sold.
(Please clearly segregate sentences for each market. However, sentences of different lengths can be ordered in any way within a market grouping).
Because of the time limitations of this class, the instructor will review finished goods
inventories after class to ensure that:
1. sentences make sense.
2. sentences are grammatically correct.
3. sentences belong in the specified category (general 3 to 6, general 7 to 9, general 10+, specialty market 1, 2, or 3)
4. reputation has been appropriately established in any specialty market in which
the organization is operating (10 or more acceptable sentences produced).
Nonsense sentences and grammatically incorrect sentences will be discarded in their
entirety with no opportunity granted to the producing company to repair them.
Sentences that do not qualify for a given market may be moved to another market
and sold there at market prices.
If, as a result of quality control screening, the number of acceptable sentences produced in a given specialty market drops below 10, then none of the sentences produced for this market may be sold there. They may be moved to other markets for
which they are applicable and sold there at market prices.
Tabulation of Results
For each firm, the instructor will record:
1. number of sentences passing quality control in each of the 7 categories
2. number of words in accepted sentences in each category
3. if appropriate, number of prepositional phrases accepted in sentences in that
category.
The instructor will combine results for all firms to determine which markets have
gone into glut. She or he will then tabulate total revenue by firm and place this information, with calculations, on the course Web page. In addition, one selected representative from each organization will receive a typed copy of all sentences submitted.
This list will identify disqualified sentences and will give the reason for disqualification. In addition, if the instructor removes any sentence(s) from the intended market
and sells them in another market, reasons will be given on this listing (e.g., sentence
does not contain a prepositional phrase or fewer than 10 sentences accepted in this
category).
YOU MUST DOCUMENT YOUR GROUPS
BUSINESS-LEVEL STRATEGY PROCESS
A well-thought-out business-level strategy is essential to success in the Magnetic
Sentences Industry Game. Whether your strategy is effective or ineffective at the start

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

Casile, Wheeler / MAGNETIC SENTENCES INDUSTRY GAME

711

of the game, it is likely to change during the course of the game as you learn more
about your competitors and yourselves. To help ensure group-wide understanding of
your strategy, and to help you recall the evolution of your strategy throughout the
game, please take notes or minutes during strategy sessions. Ideally, these minutes
should contain the following information:
 our companys goals
 our planned means of achieving those goals
 our selected target market(s)
 what we considered in setting our goals and means and in selecting target markets (What did we see as our strengths and weaknesses, threats and/or
opportunities)
 what (if anything) came up during each of the production periods that caused
us to reevaluate our strategy.
 how (if at all) did our business-level strategy change from Period 1 to Period 2.
 If we were to play this game for another period, would we change our strategy? If so, how.
GAME AGENDA:

Day 1:
1.
2.
3.
4.
5.

Read instructions: (before class!!!)

Arrive and form groups: (5 minutes)
Devise and document a strategy: (15 minutes)
Production run: (25 minutes)
Get information, unused raw materials, and output to the instructor: (30 seconds)

Day 2:
3.
1.
2.
3.

Arrive and form groups: (5 minutes)

Devise and document a strategy: (15 minutes)
Production run: (25 minutes)
Get information, unused raw materials and output to the instructor: (30 seconds)

Day 3:

1. Discuss Magnetic Sentences Industry Game Exercise and how it relates to

strategy in general and to business-level strategy in particular.

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

712

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012

# Sent.

3 to 6

7 to 9

10+

General Market

Word Count by Sentence Length

3 to 6

7 to 9

10+

Command Market
3 to 6

7 to 9

10+

Questions Market

3 to 6

7 to 9

7 to 9

10+

10+
Words P. Phs Words P. Phs Words P. Phs

3 to 6

Prepositional Phrase (P. Ph) Market

1. Ensure that the sentence passes quality control and so can be counted. Sentences that do not pass quality should not be included on this
form.
2. Determine whether the sentence can be sold in the general market or any of the specialty markets.
3. Count the number of the words in the sentence.
4. Enter the word count for the sentence in the correct column based on items 2 and 3 above.

Instruction: For each sentence in the output you are reviewing, please:

Appendix B
Magnetic Sentences Industry Game: Sentence Tally Worksheet

Casile, Wheeler / MAGNETIC SENTENCES INDUSTRY GAME

713

References
Bowen, D., Lewicki, R., Hall, D., & Hall F., (1996). Experiences in management of organizational behavior (4th ed.). New York: John Wiley.
Deci, E. L. (1972). The effects of contingent and non-contingent rewards and controls on intrinsic motivation. Organizational Behavior and Human Performance, 8, 217-229.
Dumaine, B. (1994, October 17). Mr. learning organization (P. Senge). Fortune, 130, 147157.
Employer survey of the National Center on the Educational Quality of the Workforce. (1995).
Philadelphia: Trustees of the University of Pennsylvania.
Hartenian, L. S., Schellenger, M., & Frederickson, P. (2001). Creation and assessment of an integrated business course: One colleges experience. Journal of Education for Business, 76(3),
149-159.
Kieman, M. J. (1993). The new strategic architecture: Learning to compete in the twenty-first
century. Academy of Management Executive, 7(1), 7-21.
Mosca, J. B., & Howard, L. W. (1997). Grounded learning: Breathing life into business education. Journal of Education for Business, 73(2), 90-93.
Porter, M. E. (1998). Competitive advantage: Creating and sustaining superior performance.
New York: Free Press.
Quinn, J. B. (1992). The intelligent enterprise: A new paradigm. Academy of Management Executive, 6(4), 48-63.
Stephen, J., Parente, D. H., & Brown, R. C. (2002). Seeing the forest and the trees: Balancing
functional and integrative knowledge using large-scale simulations in capstone business
strategy classes. Journal of Management Education, 26(2), 164-193.

Downloaded from jme.sagepub.com at OhioLink on August 28, 2012