My son has $23.6 billion. $7.2 billion in cash.
He also forecast Airbus’ failures with their A380. He’s a rabid fan of the plane and sings its praises constantly…the suites, the capacity, the range. But he doesn’t use them for his own airline. He’s not alone. As this NY Times article notes, no airline in the U.S., South America, or Japan is going long on A380s.
Kalo (not his real name) started his dynasty for $0.99. Perhaps your kid did the same because his net worth comes by crushing the iOS game Air Tycoon.
Far more important: I believe his experience with Airbus’ A380 tells us about how the next generation will make strategic business decisions.
I’ve been waiting to write this post for >10 years. Because I’ve been waiting for a mainstream article about the market success or failure of the Airbus A380 for over ten years. Why? Airbus started the A380 initiative around the same time Boeing started the 787 initiative. In that distant time – before iPhones and Amazon Prime – I came across an article noting this was the one of the few times the two airline behemoths took simultaneous, but fundamentally-different strategic approaches:
- Airbus: A380 – big, heavy (4 engines), high capacity, ideal for hub-to-hub networks
- Boeing: 787 – nimble, more efficient (2 engines), moderate capacity, ideal for point-to-point networks
That old article noted plane purchases had long been political and nationally subsidized. But finally, finally, these planes were different enough to win or lose based on strategic intent – the planes would fly (or not) on their own.
We just had to wait.
Airplanes take years of design, testing, building, marketing, more testing…and waiting for the orders to come in (while the PR people breathlessly claim their plane is winning).
Seems like the judgment is in. But Kalo already knew that.
You see, when I mentioned the NY Times article, Kalo replied…
“You know, I don’t use A380s in my airline.”
Faced with even modest game realism (airplane cost, capacity, fuel efficiency, range, travel patterns…) and the drive to win, respond to the market, and serve his “customers,” Kalo decided his beloved A380 was a poor fit. At 11 years old, he picked the right horse.
Every parent I know hates how much time our kids play electronic games. Meanwhile, our strategic decisions are largely made by old smart people armed with whiteboards or Powerpoint.
I believe future CEOs (i.e., today’s 11 year olds) will not be content with a SWOT analysis or spreadsheet. The directive of these future CEOs will be simple:
Make a moderately realistic simulation game allowing multiple strategies and let people play. Then let’s see who wins.
Takeaways
- Start a simulation mindset for major strategic decisions. Determine the minimum viable model you can use to represent your situation. Use that model to create a game, discussion, or workshop. Play.
- Get familiar with the “Wisdom of Crowds” concept. It’s a critical intellectual foundation for why this approach will work. But without simulation, it can be hard to use.
- Let your future executives, er, children, hone their strategy skills early: guide their games rather than just criticizing them.
