Winners in the Grand Game
October 6, 2010 By: Alan CameronThe Grand Game was held at GPS World's Leadership Dinner during the ION conference in Portland, on the evening of September 23. Roughly 138 GNSS community VIPs attended. 18 of the guests were GPS Heroes, some of the individuals (and their spouses) who built the program in the early 1970s. Many had not seen each other since those days. GPS World, dinner sponsor Rockwell Collins, and Dr. Brad Parkinson joined in recognizing these pioneering individuals with small personal mementos.
After dinner, 108 of those present played the Grand Game. To briefly recap, here is the game structure. A rules overview appears in an earlier blog. An even more complex set of detailed rules was distributed to team captains just prior to the dinner.
Parameters: Played by 12 teams (tables) of 9 players each, for four 15-minute quarters (constrained by time, we played three quarters in Portland).
Object: To reach a quantified goal by the end the game, by striking deals with other teams to exchange various assets. Each team has a different goal (consisting of assets it must obtain from other teams) and a different set of assets that it can offer in trade.
Teams
GPS System Operator, Galileo System Operator, GLONASS System Operator, Compass System Operator
U.S. Industry, European Industry, Russian Industry, Chinese Industry
U.S. User Community, European User Community, Russian User Community, Chinese User Community
Assets: System operators have money. Industries have both satellites and receivers. Users have money.
Goals: System operators seek to launch satellites (purchased from industry) to generate an increasing number of signals (for users). Industries seek to profit from the sale of satellites and receivers; the more signals that operators can broadcast from space, the higher the value (price) of receivers they can offer. Users seek greater capability, measured by the number of advanced (multi-frequency) receivers they can accumulate over time.
And now, the results, given by divisions. For the overall Grand Game Winners, you have to read all the way to the end of this story.
The SYSTEM OPERATORS division was won by the Galileo System Operator, captain Dorota Grejner-Brzezinska commanding. By the end of the third quarter or the year 2025, they had amassed an astonishing constellation of 87 satellites (accounting for others that had reached end-of-life by that stage), an overall performance score of 231 against stated goal of 30 satellites.
Team member Allison Kealy reveals their strategy: "Basically, our team had three women who considered shopping their strong point and opted for a purchasing role.
"We attempted an initial purchase of residual GPS satellites from the GPS Operators, with team negotiators really committing and offering whatever it took for the transaction to be completed. We then attempted to forge an alliance with them to create some sort of monopoly in the operator world. As the evening continued, however, our approach basically degraded into buying all satellites possible, thereby preventing other operators from having access. At one point we negotiated a purchase of 50 Chinese satellites for $2B in one brief transaction. We had relatively little contact with the users, and ironically this seems to replicate reality.
"Lots of shouting, a few lost voices, lots of scheming, lots of passion, lots of commitments, too much competition, and a team captain with a keen eye for a bargain led to a great night!"
Captain Grejner-Brzezinska adds, "Our strongest political asset was my chief negotiator: David Turner!"
GLONASS System Operator, led by Chris Hegarty, took second place with a score of 186, representing 75 satellites against a goal of 35.
Compass System Operator, captain Greg Turetzky, kept 55 satellites in orbit by the year 2025, for a score of 155 against goal 35 satellites.
The GPS System Operator with Michael Glutting in command maintained a worthy constellation of 60 satellites, compared to a goal of 45, for a score of 133. The gamemaster was unable to confirm reports that three back massages ("whatever it took") offered by the wily women shoppers of the Galileo contingent lulled GPS master strategist Javad Ashjaee into a state of quiescence.
The greatest profit margin in the INDUSTRY division was amassed by the Russian Industry, captain John Betz. The team had gross revenues of $9.6 billion for the five-year period 2020 to 2025. After paying off all costs associated with satellite and receiver manufacture, they kept profits of $4.85 billion. Averaging with their scores in the first two quarters, they finished with an overall performance rating of 157.
Betz submitted this detailed brief: "The Russian Industry team began the first quarter with the discovery that two of its hats had disappeared, restricting the number of team members who could leave the table without being arrested as spies. We received no sympathy from the Marshalls, and determined to do the best we could even with this handicap. During the first quarter, users and industry were slow to spend their money, and we found our receiver manufacturing costs were higher than the price most users were willing to pay. At our sales meeting after the first quarter, we resolved to increase our sales volume. In the second quarter, we sold an increasing number of receivers and frequencies, but later determined many of them had been sold for less than our cost. Our satellites sold briskly in the second quarter, since their lifetime of two quarters would let them endure through the third quarter, projected to be the end of the game. At the end of the quarter, we observed many users and operators desperately trying to spend large amounts of remaining cash, so at our sales meeting we resolved to encourage large purchases early in the following quarter. In the third quarter we rapidly negotiated the sales of large blocks of multi-frequency receivers, and large blocks of satellites. As the quarter closed, we found we had sold out, and had time to ponder whether finishing the game at three quarters was an archetype of the real world of GNSS, where it seems we’re never quite finished, and always waiting for the next event."
European Industry, led by Sam Pullen, finished with a higher third-quarter gross of $10.4 billion, but profits fell to $4.15 billion once production costs were assessed. Their game-averaged score amounted to 124.
U.S. Industry, with Matt Harris at the helm, pulled $7.85 billion in revenue in the last period, but only $1.6 billion in profit, for an overall game rating of 117.
Chinese Industry, captain Tim Murphy, grossed $4.85 billion, with $1.25 billion in profits, and an averaged score of 115.
All three latter industries fell victim to their own over-eagerness to sell, or to buyers' demands for lower prices, as they undercut their own production costs, to varying degrees at different stages of the game. Thus each generated a negative cash flow and large holes out of which to dig themselves. The hard-nosed approach of the Russian merchants carried the day.
In the USER division, the purchasing power of the Chinese User Community took first place. Frank van Diggelen led the team that corralled a staggering total for the period 2020-2025 of 11 blocks of triple-frequency receivers (each block consisted of 50 million receivers), 5 blocks of 4-frequency receivers, and 5 blocks of 5-frequency receivers. This gave them an overwhelming performance score of 709 when compared with a given goal of one block of triple-frequency receivers and two blocks of 4-frequency receivers. No doubt the rapacious price demands of this market group was responsible for the profit backslide, cited above, of three entire industries.
Van Diggelen recalls, "It was a fabulous evening, one of the best. Thanks again.
"My team was China Consumers: Per Enge, Bruce Peetz, Sherman Lo, Grace Gao, Olivier Casabianca, Francois Erceau, Steve Malkos, and Jason Goldberg.
"The most memorable thing, by far, was after I’d sketched out a team plan for who would negotiate what, Grace, assisted by Sherman, leapt into the fray, and was soon taking care of all the business 10 times more effectively than all the rest of us together. We were left to tally the numbers, count money, and drink the wine -- activities we found hard to keep up with, the speed with which Grace made things happen.
"As the evening wore on, we all enjoyed it more and more, and we are quite convinced we must have won.
"I’ve attached a picture of the team [shown at the top of this story], as well as an action shot. The action shot is from my iPhone4, so it’s not great print quality, but it is georeferenced (I hear there’s a great GPS in that phone :-) )"
The U.S. User Community compiled a much-much-more than respectable score of 217, reflecting a game-end asset total of one dual-frequency block, seven 3-frequency receiver blocks, and two four-frequency blocks. This user group was headed by Sasha Mitelman. All user communities, by the way, had the same overall goal.
The European User Community, captain Ron Hatch, finished with a score of 155, with four dual-frequency blocks of 50 million receivers each, and three triple-frequency blocks.
The Russian User Community seems to have taken a very conservative approach to the market, amounting to hoarding nearly all their cash. Captain Alison Brown may have had to contend with some naysayers or adherents to old technology. The team finished with only two blocks of four-frequency receivers, but was sitting on a nest egg of $6.2 billion. Perhaps they were positioning themselves for a big run in the period 2025-2030. Regretably the fourth quarter of the game never took place, as time ran out.
And now for the GRAND WINNERS of the GRAND GAME of GNSS:
First Grand Winner: Chinese User Community, scoring 709 and undermining much of the world economy in the process.
Second-place Grand Winner: Galileo System Operator, score 231.
Third-place Grand Winner: U.S. User Community, score 217.
Fourth-place Grand Winner: GLONASS System Operator, score 186.
Not the results you expected? What is this, the real world? Admittedly, all game results reflect not only the performance of the players but the guesswork performed by the gamemaster in compiling the metrics and the goals governing the game. Perhaps we'll return to this again in 2011, with an expanded and more complex GigaGrand Game of GNSS.
This closing strategic insight from first mate Per Enge on the winning Chinese Users team:
"Yes, the Chinese User's group concentrated the negotiation power entirely with Grace. However, please know that the other team members did have very important jobs. For example, I was the Conformance Officer. I was responsible for making sure that all team members were wearing their hat should they leave the table. Bruce Peetz was the CSO -- Chief Stemware Officer. He was responsible for assuring that all team members had a glass of wine. We also had a CPO -- Chief Paperclip Officer, who was responsible for making sure that the paper clips [representing frequencies] were firmly attached to the receiver cards."
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