The Independent Management Game 1994: Teams clear first round

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THIRTY teams from a range of industries and geographical locations have battled through the first round of the Independent Management Game to win places in the semi-finals, writes Roger Trapp.

Most of the qualifiers in the game, sponsored by National Westminster Bank, lifted their imaginary companies' share prices above the ecu1.12 at which they started, with a few showing dramatic rises. For instance, the 'Paul Smith' team from Ashbourne, Derbyshire, pushed theirs to ecu1.78, while the BPP Accountancy Courses achieved ecu1.50.

Among those that have not reached the next stage are two complete 'melt-downs', with share prices of zero and several teams struggling at less than ecu1, said Bill Robertson of organisers, Edit 515.

However, there were also some hard-luck stories where only tenths of an ecu divided the successful from the failures.

The business that the teams were charged with managing manufactured a highly seasonal product, which caused many internal conflicts between marketing and production. Profits were hit by wild fluctuations in stock.

Teams tended to chop and change between policies, instead of recognising that the key ingredients of success were combining a clear strategy with proper forecasting.

Although some participants managed to rectify a poor start through improved management, bad results early on tended to lead to low or non-existent dividends, with an adverse effect on the share price.

Mr Robertson said the game's 'realistic and comprehensive simulation' introduced specialists such as bankers and accountants to marketing, production, personnel and other matters, while those with more general backgrounds gained experience of accounts and finance. 'For some, the exercise was a real eye-opener, especially the stressed banker who rang up game control to find out why the game bank would not raise his overdraft limit,' he said.

The semi-final, which starts on 27 September, will see the teams managing the same company from a new starting point, under different economic pressures.

Five teams will contest the final at a London hotel in November, and the winner will compete in Europe next year.