Visualization, testing, and learning

[This is the fourth entry of 18 in a game design journal series introducing Spheres & Farms™, a game about real estate brokerage branding in the Puget Sound region. Previous | Next]

The foregoing discussion on price analysis is all that practicing real estate agents and brokers need to know to visualize market prices for their clients. Additional knowledge of summary market data such as months in inventory, days on market, a bit about residential appraisal, real estate law and finance, and market interest rate trends are together sufficient for the agent to properly represent clients and carry on business. That is because most agents serve no more than a handful of markets, either by location, residential type, or demographic sphere. As personal brands, their presence and visibility are limited to what they can physically deliver.

The brokerages and brands for whom these agents work need to think more broadly. Brokerages need to think more broadly than agents. While the agents practice place marketing in miniature—an apt description of home sales—the brokerage brand sells intangibles. Their scope of business comprises those markets of all the agents whom they employ, or might employ in the future. To meet their goals, the brands must be familiar with the aforementioned metrics of market conditions, but must also consider ways to visualize the most effective deployment of resources among these different markets.

From persuasion to discovery

The question is how to evaluate and potentially reset priorities for recruitment, promotion, and office location to maximize brand visibility. Business owners need to visualize and better understand the range of options before selecting a course of action.

The usual means of visualization involve persuasion—seldom discovery—through presentation and argument. Charted data, graphics, and sometimes animation may be used to portray the business environment. For residential real estate, these measures will include listing and selling prices, selling counts or volumes, days on market, and months in inventory. Success in making a case based on these data depends on the willingness of the hearers (or readers) to be convinced, which is easiest in a static environment when no change is called for. When change is needed but not desirable, these methods fall short; Royal Dutch Shell planner Pierre Wack described them as “water on a stone.”²

Over the past half-century, among the methods presented to enable organizations to manage uncertainty, two stand out: the first is scenario planning, and the second is wargaming. A variety of methods have been presented that fall into these two broad categories. Scenario planning is storytelling centered on “bounded reality.” Scenario planners begin by identifying fixed pipeline trends and key uncertainties, then concoct different stories about the future devised around alternative outcomes for the uncertain elements.³ The learning generated from these stories enables the client organization to formulate shaping actions upon those outcomes over which they exert some control, and hedging actions against those outcomes that they cannot avoid or control.⁴

Scenario planning is a broad-brush technique that allows recognition of foreseeable trends and inevitabilities that are in view, but perhaps unnoticed or not fully understood by most participants. Stories must reflect internally consistent outcomes for the various uncertainties to be modeled. Done well, it allows a consensus to brought together on strategies that might otherwise remain controversial or difficult to sell. It can help an organization to answer for themselves the big questions: which markets to target, which products to offer, from whom to source, and how to counter potential supply disruptions.

It is of lesser value where the focus is or must be on prioritizing existing markets under near-term economic conditions, and where the uncertainties are isolated to the organization and its brands—for example, which among several dozen untouched markets should receive priority for entry. Such molecular details are not easily discoverable through scenario analysis, which centers on the macro trends and uncertainties. This is why the foundation products of scenario planning are stories or narratives, because a consensus on what is certain and what is not, and therefore what must be, is more easily delivered at the macro level. From there, the localized impacts on a single organization or participant can be inferred. Storytelling with scenarios is useful for visualization of industrywide outcomes, but offers little guidance into the multitude of small steps that a single brand might take to change its own fortunes under more stable conditions.

Games as a means of market visualization and testing in simulated environments

For that, another means of visualization is needed, one rooted in current realities, yet flexible enough to allow discovery of a wide range of strategies. It must convince by modeling likely contingencies and everyday actions of participants rather than provide a rich, but speculative foretelling of broader trends and events with implications, but no specific guidance for the here and now. Games are one way to experiment with new priorities and strategies before making lasting and high-risk investments. For example, systemic wargaming enables business owners to

test overarching strategies and specific plans before committing their organization, its people, and its resources to a course of action from which there is no turning back. It is a way to experience the future without the risks attendant in the real world.⁵

Not all games are wargames,⁶ and not all games offer systemic design features that allow this kind of testing. In the commercial video game market, many experienced players demonstrably familiar with game design will assume that a narrative is an essential mechanic to any game design. Some such players, especially players of action and adventure video games, will find themselves to be participating as players in strategy games, or otherwise as clients for the outputs of those games. They may be looking for narratives as mechanics that drive the game forward toward a result that they expect.

Game designer Raph Koster has argued that narrative is not a mechanic.⁷ Instead, among games that are organized as decision trees, or directed graphs, it is a kind of feedback that runs parallel to the alternative paths that can be followed by the player. It is otherwise irrelevant to the player’s input or resolution. Video games deliver this feedback through a combination of film, writing, visual arts, and music. Compared with more systemic strategy games and board games, among which the inputs include, for example, deciding upon strategy for multiple pieces, the feedback for videogames is often outsized relative to each player’s input and the resolution of that input. For these games, both of the latter may be very simple in comparison with the spectacle presented as feedback.

Such games cultivate a kind of player who is captivated by the experience of an expected result rather than by opportunities to learn. Not everyone will immediately appreciate the business insights yielded by a systemic gaming experience. These players may be more likely to appeal to heuristic-based biases when interpreting unfavorable results.

When such fallacies are raised, it is wise to resist them. Speaking as designers, Herman, et al. advise, “the participants can fight the scenario, but we always caution them against it … the power of the game is in the experiential learning of the real experts.”⁸ The player objectives are defined in game terms, yet the purpose of the game itself is discovery. For that to happen, borrowing from Koster’s description of game models, the resolution (i.e., the “black box”) and the player’s input must each be calibrated with real-world data for the game’s feedback to deliver any value. Otherwise, that feedback may satisfy the player, but no learning has occurred, and the exercise has been meaningless.

Systemic games emphasize inputs and resolutions that interlock with others to model externalities and other systematic effects. Understanding these interactions is a key benefit to participants in this kind of game. Features of Spheres & Farms^™ that reflect systemic design include the following, among others:

A listing at a location partly meets, and therefore reduces the demand for other listings in that location.
A sale among a marketing sphere reduces the demand in that sphere, and thus the number of potential sales by other brokers working in that sphere.
An economic cycle shift either increases or reduces the demand, and thus the numbers of potential sales, to all spheres, including geographic farms.
Certain events may induce small, localized shifts in demand to marketing spheres or geographic locations.
High concentrations of sales, such as in new developments like condominium towers, generate tangible and intangible resources that can be redeployed into promotions at other locations.

² Pierre Wack, “Scenarios: Uncharted Waters Ahead,” Harvard Business Review, September 1985.

³ Peter Schwartz, The Art of the Long View: Planning for the Future in an Uncertain World, New York: Doubleday, 1991.

⁴ James A. Dewar, Carl H. Builder, William M. Hix, and Morlie H. Levin, Assumption-Based Planning: A Planning Tool for Very Uncertain Times, Santa Monica: RAND, 1993. Scenarios should never number more than three or four, built around critical uncertainties that are causally linked. Business strategy should not be built to counter low-likelihood contingencies. Decision makers must be aware of these contingencies, but cannot divert too many resources to anticipate them.

⁵ Mark Herman, Mark Frost, Robert Kurz, Wargaming for Leaders: Strategic Decision Making from the Battlefield to the Boardroom, Booz Allen Hamilton, 2009; p. 13.

⁶ There is much controversy in the wargaming community as to what counts as a wargame and what does not. We will not wade into that here; we are only referring to the mechanics and process of wargaming.

⁷ Raph Koster, “Narrative is not a game mechanic,” Raph Koster’s Website, 12 January 2012 (https://www.raphkoster.com/2012/01/20/narrative-is-not-a-game-mechanic/).

⁸ Herman, et al., p. 152.

From persuasion to discovery

Games as a means of market visualization and testing in simulated environments

Schedule of entries