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A U G U ST 2 5 , 2 0 2 2
TEACHING NOTE
Strategy Simulation:
The Five Forces yo
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This teaching note was prepared by Professor Rachel Wilson of Belmont University for the sole purpose of aiding classroom instructors in the
use of Strategy Simulation: The Five Forces (HBP No. 7880). HBP educational materials are developed solely as the basis for class discussion.
These materials are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management.
Copyright © 2022 Harvard Business School Publishing. To order copies or request permission to reproduce materials, call 1–800–545–7685,
write Harvard Business Publishing, Boston, MA 02163, or go to http://www.hbsp.harvard.edu. No part of this publication may be reproduced,
stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying,
recording, or otherwise—without the permission of Harvard Business Publishing.
Harvard Business Publishing is an affiliate of Harvard Business School.
This Teaching Note is authorized for use only by Po Yung Anna Tsui, The Chinese University of Hong Kong (CUHK) until Apr 2023. Copying or posting is an infringement of copyright.
Permissions@hbsp.harvard.edu or 617.783.7860.
Table of Contents
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Quick Facts ............................................................................................................................................. 6
Key Information ......................................................................................................................................... 6

Running the Simulation ............................................................................................................................. 6
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Learn More ................................................................................................................................................ 6
Getting Started.............................................................................................................................................. 7
Teaching Note ............................................................................................................................................... 7
Overview .................................................................................................................................................... 7
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Introduction ............................................................................................................................................... 7
Synopsis .................................................................................................................................................. 8
Learning Objectives ................................................................................................................................ 8
Audience ................................................................................................................................................. 9
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The Student Experience............................................................................................................................. 9
Preparation ............................................................................................................................................. 9
Events Center ....................................................................................................................................... 10
Post-Events Assessment and Optional Reflection................................................................................ 11
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Leaderboard ......................................................................................................................................... 11
Teaching Plan .............................................................................................................................................. 11
Suggested Uses ........................................................................................................................................ 11
Assigning Roles ........................................................................................................................................ 11
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Single-Player ......................................................................................................................................... 12
Solo Play ............................................................................................................................................... 12
Team Play ............................................................................................................................................. 12
Introducing the Simulation ...................................................................................................................... 13
Preparation and Pre-Work ................................................................................................................... 13
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Debrief ..................................................................................................................................................... 14
Gourmet Chocolate Scenario ............................................................................................................... 14
Short-Term E-Scooter Rental Scenario ................................................................................................. 16
Additional Discussion Questions .......................................................................................................... 19
HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 2

Wrap Up ............................................................................................................................................... 20
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The Five Forces Model ............................................................................................................................. 20
Leaderboard Calculation ...................................................................................................................... 22
Teaching the Simulation in an Online Setting ......................................................................................... 22
Setting Up the Simulation and Preparing Students.............................................................................. 23
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During Simulation Play ......................................................................................................................... 24
Debriefing the Simulation Online ......................................................................................................... 24
Final Thoughts about Online Play ......................................................................................................... 24
Technical Guide................................................................................................................................... 25
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Adopting the Simulation and Enabling Student Access........................................................................... 25
Simulation Overview ................................................................................................................................... 27
Student User Screens .............................................................................................................................. 27
Welcome Page ...................................................................................................................................... 27
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Industry Information ............................................................................................................................ 27
Role ....................................................................................................................................................... 28
Tutorial ................................................................................................................................................. 30
Events Center ....................................................................................................................................... 31
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Menu .................................................................................................................................................... 31
Event Decision Section ......................................................................................................................... 32
Event Analysis Section .......................................................................................................................... 35
Event Outcome Section ........................................................................................................................ 35
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Final Industry Assessment .................................................................................................................... 36

Final Reflection ..................................................................................................................................... 37
Leaderboard ......................................................................................................................................... 37
Team Play ............................................................................................................................................. 38
Two Scenarios....................................................................................................................................... 40
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Light Mode............................................................................................................................................ 41
Faculty Administration Screens ............................................................................................................... 42
Setup Users........................................................................................................................................... 42
Setup Events ......................................................................................................................................... 42

Setup Experience .................................................................................................................................. 43
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Setup Run ............................................................................................................................................. 44
Run Progress ......................................................................................................................................... 45
Results .................................................................................................................................................. 45
Facilitator Materials ............................................................................................................................. 47
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Appendices.................................................................................................................................................. 48
Appendix A: Gourmet Chocolate Industry Force Descriptions................................................................ 48
Focal Firm: Dahlia Chocolate ................................................................................................................ 48
Supplier: Xoco Direct ............................................................................................................................ 48
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Buyer: Bread & Circus ........................................................................................................................... 49
Competitor: Ruban de Soie .................................................................................................................. 49
Substitute: Spumoni Co. ....................................................................................................................... 50
New Entrant: Vu Ventures.................................................................................................................... 51
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Appendix B: Gourmet Chocolate Industry Event Text ............................................................................. 51
Cacao Blight .......................................................................................................................................... 51
Governmental Warning ........................................................................................................................ 51
Global Recession................................................................................................................................... 52
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Cacao Cartel.......................................................................................................................................... 52
Contamination ...................................................................................................................................... 52
Appendix C: E-Scooter Industry Force Descriptions ................................................................................ 52
Focal Firm: Veratti ................................................................................................................................ 52
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Supplier: Haegi ..................................................................................................................................... 53

Buyer: Mia Rossi ................................................................................................................................... 53
Competitor: Escapada .......................................................................................................................... 54
Substitute: Fastda ................................................................................................................................. 55
New Entrant: Laiz ................................................................................................................................. 55
Appendix D: E-Scooter Industry Event Text............................................................................................. 56
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Direct-to-Consumer .............................................................................................................................. 56
Battery Supply Chain ............................................................................................................................ 56
Partnerships with Cities ........................................................................................................................ 56

Heightened Regulation ......................................................................................................................... 57
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Entry of Laiz .......................................................................................................................................... 57
Appendix E: The Five Forces .................................................................................................................... 57
Power of Suppliers................................................................................................................................ 57
Power of Buyers ................................................................................................................................... 58
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Rivalry Among Existing Competitors .................................................................................................... 59
Threat of Substitutes ............................................................................................................................ 59
Threat of New Entrants ........................................................................................................................ 60
Appendix F: Pre-Play Discussion Questions............................................................................................. 61
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Appendix G: Complementary Resources ................................................................................................. 63
Appendix H: Release Notes ..................................................................................................................... 64
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QUICK FACTS TEACHING NOTE TECHNICAL GUIDE APPENDICES
Quick Facts
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Key Information
Author Rachel Wilson
Players/Scenarios/Roles Single player and multiplayer, two scenarios, six roles
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Asynchronous Play? Yes, suggested for single-player or solo play
In-Class or Out-of-Class Play Either
Teaching Points Strategy, industry analysis, the Five Forces framework, strategic analysis, profitability,
competitive strategy
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Target Audience Undergraduate, graduate, or executive students in any course where the above subjects are
taught
Accompanying/ Teaching note, introductory slides, and dynamic debrief slides

Supplemental Material
Approx. Time Required Student preparation: None Simulation play: 90–120 minutes Debrief: 45–60 minutes
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Running the Simulation
Technical specifications for this simulation can be found here: (A) Technical Specifications, (B) System Check. The typical steps
for setting up and running this simulation are as follows:
1. In the Setup tab, go through the four sections (Users, Events, Experience, Run) to set up a new run. The class can play
multiple runs of the simulation, but only one at a time.
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2. Make sure to set up students as solo players (against computer players), single-players (against each other in a world),
or arrange teams within worlds in the Setup Users tab before opening the simulation. You can choose to auto-assign
students or manually assign their force and team (if applicable) with the Custom option.
3. Customize the simulation as desired: choose three or five events, choose which scenario to use, and choose whether to
include optional features such as reflection boxes and the industry assessment.
4. Open the simulation for play or you may choose to open the simulation in stages. When students are finished playing,
begin the debrief.
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Learn More
To learn more about this simulation, carefully review the teaching note and take advantage of any or all of the following
resources:
• Free trial • Web tour
• Simulation preview • Information sheet
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For these and other resources visit: https://hbsp.harvard.edu/product/7880-HTM-ENG

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Getting Started
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This teaching note is designed for administrators of Strategy Simulation: The Five Forces (HBP No. 7880).
• The Teaching Note section gives specific information related to the learning objectives and
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teaching opportunities inherent in the simulation.
• The Technical Guide section reviews the process by which a faculty member adopts the simulation
through the Harvard Business Education website and extends that access to students.
• The Simulation Overview section provides screenshots and description of user and administrative
screens.
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• The Appendices section provides further information about the simulation as well as
supplemental reading suggestions.
Teaching Note
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Overview
After providing an overview of the simulation and outlining some technical items, we review the various
tasks and challenges posed for the students. We discuss learning objectives, the types of analyses that
students are expected to perform, and the insights they should develop by playing the simulation and
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then analyzing it. We also discuss how to use the simulation in a course, the simulation’s target audience,
and a suggested teaching plan. Finally, we describe how to customize the simulation, prepare for class,
and facilitate the debrief session.
This teaching note was last updated on August 25, 2022. For detailed release notes, see Appendix H.
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Introduction
Michael Porter’s Five Forces framework has long been taught in business schools and used by strategists
worldwide. It offers a way to understand how an industry’s structure influences competition and
profitability for the firms in that industry. This framework holds that an industry’s attractiveness and
profit potential depend on the interplay of five major types of industry players: suppliers, buyers,
competitors, substitutes, and potential new entrants.
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Although this framework is a powerful tool, students who have little work experience or who have
taken few business and economics courses often have difficulty understanding and applying it. This
challenge reflects two related factors. First, concepts like “buyer” and “supplier” are deceptively abstract
because their meaning and implications within this framework extend well beyond their common usage.
Second, few students have had the opportunity to think about the array of interests and influences that
affect the value chains between suppliers and consumers. Not surprisingly, these students may attempt

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to memorize the basics of each force and the relationships among these forces without understanding the
causal underpinnings that drive such relationships.
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This simulation addresses these challenges by immersing users in an industry setting (either the
gourmet chocolate industry or the short-term e-scooter rental industry) with participants that possess
varying degrees of resources and power. Students are given information about their own role and the
other forces within the industry, and then they must decide how to help their company succeed in
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various events that involve sudden environmental shifts. They compete amidst other motivated forces,
who simultaneously make decisions that attempt to improve their own positions. After students respond
to each event, they see the results of their decisions.
Students who play the simulation benefit in several ways. First, they learn how to apply Porter’s Five
Forces more thoroughly than they would have under more passive forms of learning. Being immersed in
a company and an industry where their decisions have consequences reinforces the insights this
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framework provides.
Second, they begin to develop an allocentric perspective of other forces within an industry beyond their
own. By seeing how other firms’ interests and decisions affect the interactions among industry
participants, as well as the outcomes that ensue from these interactions, students learn to account for
others’ interests when they formulate strategic responses. For instance, the simulation enables students to
see how changing industry conditions affect the opportunities available to substitutes or to potential new
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entrants. Similarly, although a supplier may usually be an attractive long-term source for less-expensive
inputs, that supplier could charge a premium price to a customer that cannot easily find the inputs
anywhere else when a supply shock occurs, and perhaps even threaten to integrate forward.
Third, the simulation lets students develop insight into how the above lessons can apply to situations in
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industries beyond those covered in the simulation. The multiple events that students play through during
the simulation pose different opportunities and constraints for their firm. This repeated practice with
slightly different events helps them understand how such variations can influence a firm’s profitability
and competitive position.
Synopsis
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The origin of this simulation is rooted in an in-class role-playing exercise, conceived in response to the
challenges that undergraduate entrepreneurship students had when they learned about strategic
management concepts they had not yet been exposed to or had forgotten. The simulation combines
action-based learning with realistic scenarios, playable within a single class session and with a reasonable
level of (optional) outside-of-class preparation by the student.
Learning Objectives
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Learning objectives will vary depending on the goals of the instructor and the nature of the class, and the
simulation should serve to support a wide range of learning objectives. After engaging in the simulation
experience, in the context of other learning from reading and classroom lectures, students should be able
to demonstrate an understanding of the following:

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1. Understand roles and motivations of players in the Five Forces framework.
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2. Understand the role of power imbalance as a determining factor of strength of a force.
3. Analyze the interaction between forces.
4. Determine the attractiveness of the industry based on the Five Forces analysis.
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5. Understand that even stable industries have volatility and unpredictable events will occur.
Audience
The simulation is suitable for use in any educational programs which require a foundational
understanding of industry dynamics. This was designed for use at both the undergraduate and graduate
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levels, as well as with professional managers, engineers, and executives. In any field in which people
need to understand the operating environment of an organization, this simulation should facilitate
learning and provoke stimulating discussions that can improve understanding. The simulation offers
instructors a choice of two scenarios—gourmet chocolate and short-term e-scooter rentals—which map to
two levels of complexity. The gourmet chocolate scenario is more straightforward and would be the best
choice for students with little or no business experience. The e-scooter rental scenario, being a newer,
unproven industry and in the service space, is appropriate for students who already have a foundational
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understanding of the framework.
The Student Experience

This simulation is designed to take 90–120 minutes to complete and should be followed by a debrief that
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would typically run for 45–60 minutes. The experience of the simulation unfolds in three segments:
1. Preparation. Students spend a few minutes reading preliminary information about the industry,
each force in the industry, and their specific role.
2. Events center. Students experience a series of discrete events to which they must respond as their
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force. Each event has three sections—Decision, Analysis, and Outcome—and each section runs
with a timer (Decision section: 10 minutes, Analysis section: 5 minutes, Outcome section: 5
minutes). Timers can only be turned off if your students are playing as solo players with the rest
of the forces in their world played by computers.
3. Post-events assessment and optional reflection. After they have played through all the assigned
events, students will take a final industry assessment. There is also an optional reflection they can
fill out about their experience; not filling it out does not prevent them from reaching the end, but
could be useful for students.
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Preparation
Users first familiarize themselves with the industry by reading short descriptions of the six companies
that represent the forces in the chosen industry (gourmet chocolate or e-scooter). You have the option to

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include an initial industry assessment after they read about the different forces. The assessment has users
attempt to guess the relative positional power of each force (high, medium, low) based on their
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understanding of the short descriptions of each. The default setting for the simulation is to only have
students fill out the industry assessment at the end of the simulation, so if you want to use the initial one
as well you need to adjust that on the facilitator side.
After reading about the industry, students will learn which force they will play. Once they have read
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through a longer description of their own company, they will be given a quick multi-choice knowledge
check that asks them to consider their role’s position in regard to the industry as a whole.
Events Center
After reviewing all preparatory information, users will be taken to the events center and start the first
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event. Events are split into three sections: Decision, Analysis, and Outcome. In the Decision section they
will be given a description of the event and then make decisions about how to respond from a pre-set list
of choices. All forces can choose up to three actions except for the new entrant, who is only allowed one
choice. Students also have the opportunity to reflect on the choices they make before they submit their
decisions.
The second section is the Analysis section, where students will analyze three of the decisions that were
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made in their industry. It is possible for users to see a decision that they made in the Analysis section.
They assess how they believe each action affected the force that chose it in isolation (that is, not
considering the total balance of all decisions and external effects of the event). They receive feedback on
each evaluation immediately.
After they assess three decisions, students go to the Outcome section. In this section, the diagram of the
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industry is displayed, and the resulting position of each force is represented via the visual size of each
force. Students can view all decisions made by each force by clicking around this diagram.
Students may perceive some disconnect between the isolated decisions that they analyzed before the
Outcome section and the final outcomes of each force’s position (position is being used here as shorthand
for a firm’s bargaining power and financial position). For example, a student may understand that a
decision positively affected the company when viewed in a vacuum but be puzzled that the same force’s
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position decreased once all decisions and exogenous effects have played out (as displayed on the diagram
in the Outcome section). As such, it may be necessary to pause play between events and conduct an
interstitial debrief after the first event concludes. Students may need help understanding why the quality
of a force’s actions do not always match how the event and the whole industry’s actions affected that
force. After all, a force’s fate depends on its power and the power of other actors, and the nature of the
event itself. Facilitators might also check in after the second event to explain the framework further.
The events cycle repeats through different events, per instructor specifications—the sequenced order
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and number of events is customizable on the facilitator side of the simulation (the default setting is five
events). Please note that events are independent from each other and do not affect the forces’ position in
following events. The effects of one decision set are not carried through from one event to the next, and
each force’s position resets to the starting value.

Post-Events Assessment and Optional Reflection
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After playing through all assigned events, students will take a final industry assessment. If they were
assigned an initial industry assessment at the beginning of the simulation they will see the same prompts
the second time, but this time they should consider their experience and new knowledge of the industry
and various forces as they respond. There is also an optional reflection they can fill out about their
experience; not filling it out does not prevent them from reaching the end, but could be useful for
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students.
Leaderboard
Our experience with simulations has shown that students often enjoy knowing how their performance
compares against the performances of their peers. Because of leaderboard popularity, Strategy Simulation:
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The Five Forces features an option to include a leaderboard which students can begin to monitor once the
first event in a run is fully completed. However, we caution against reliance on the leaderboard as an
assessment or grading tool.
For more detail on how the leaderboard calculates student rank, see the Leaderboard Calculation
section.
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Teaching Plan
This section offers specific suggestions about how to use the simulation in actual classes. Courses and
their logistics obviously vary widely, and the suggestions lend themselves to customization and
modification. Some instructors will decide to have students play the simulation as homework, whereas
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others will use class time (of course, the length of class periods can vary widely among schools).
Suggested Uses
This simulation is designed for use in any course that requires a foundational understanding of industry
dynamics. It can be used in courses that teach strategy, industry analysis, strategic analysis, profitability,
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and competitive strategy, among others. It is suitable for use with students at undergraduate and
masters-levels, and also with executives. The simulation offers instructors a choice of two scenarios—
gourmet chocolate and short-term e-scooter rentals—which map to two levels of complexity. The
gourmet chocolate scenario is more straightforward and would be the best choice for students with little
or no business experience. The e-scooter rental scenario, being a newer, unproven industry and in the
service space, is appropriate for students who already have a foundational understanding of the
framework.
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Assigning Roles
There are three ways to assign roles for The Five Forces: single-player vs. classmates, solo play vs.
computers, or teams vs. classmates.

Single-Player
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If you set up students as single-players, each student will play one of the forces within a “world”
together—i.e., there will be one student playing the focal firm, one playing the supplier, one playing the
buyer, etc., within a world whose decisions affect the other forces’ positions within that world. You can
have many worlds playing simultaneously, and the choices they make do not affect each other across
worlds. If you do not have the exact number of students to fill all forces in all worlds, the remaining roles
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will be filled by computers. The computer players will make logical decisions so as to not unfairly
disadvantage the students in that world.
Assigning students as single-players within a world can be used for in-class or out-of-class play.
However, if you assign students to play as single-players with each other outside of class, each person in
a world must play simultaneously as the simulation is timed.
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Solo Play
If you set up students as solo players, each student will play one of the forces (the default is to assign
them as the focal firm, but you can customize) with the rest of the forces in their world being filled by
computers. Solo play is the only setting where you have the option to turn off the timer. This could be
useful for students whose first language is not English, or students who might have accessibility issues
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that would be aided by extra time with the content in the simulation. Please not that the decision to turn
off the timer is applied to the entire class, it cannot be done on a student-to-student basis.
Assigning students as solo players can be used for in-class or out-of-class play. It is particularly ideal if
you want your students to play the simulation asynchronously or as homework, since they will not be
dependent on the presence of other students to complete the simulation.
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Team Play
If you set up students in teams, two or more students will play one of the forces within a world together
with other teams of students filling the other roles in the world—i.e., two students playing the focal firm
together, two students playing the supplier together, etc. You can adjust the number of students on each
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team (the default is four) and if you choose to customize teams, not all teams have to have the same
number of students. If you don’t have the right number of students to fill all roles with teams, you can
have some roles in the world be filled by single-players or computers.
Assigning students in teams should only be used for in-class play. Team play is fully synchronous, as
not only will students on a team together need to be playing simultaneously, but they also need to be
playing simultaneously with the five other teams in their world.
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Introducing the Simulation
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The instructor plays a critical role in preparing students for simulation play. They ensure that the
students understand the Five Forces model at its most basic, that students understand the characters of
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the roles they are playing, and that students know the backstory of the industry situation.
Preparation and Pre-Work
Students should have some familiarity with the Five Forces framework before they play the simulation. If
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time is available, they could be assigned readings such as “The Five Competitive Forces that Shape
Strategy” (HBS No. R0801E) or Core Reading: Industry Analysis (HBP No. 8101). The latter contains several
interactive illustrations that offer a hands-on treatment of this framework. These suggestions and more
are listed in Appendix G.
If time allows, Appendix F contains a suggested pre-simulation discussion for classes who could benefit
from some help understanding the framework. These discussion questions are also included in the
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introductory PowerPoint deck (HBP No. 7883) that is available on the facilitator side of the simulation
and on the HBP Education website. If less time is available, students can be given the summary of the
Five Forces framework that is included in Appendix E. Other explanations of this model are ubiquitous
throughout strategy and entrepreneurship texts.
Depending on students’ familiarity with business strategy concepts, they may benefit from a short
discussion of what they gleaned from the reading. This discussion could include a summary of the major
ideas from the reading, a question-and-answer period regarding each force, and a short discussion of the
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behaviors that lead to profit maximization. Students could also be primed on each type of force they will
encounter in the simulation as this discussion concludes.

Debrief
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We recommend that instructors begin the debrief by focusing on the focal firm and its competitor before
they expand the discussion to consider suppliers, buyers, substitutes, and potential new entrants. This
approach enhances an instructor’s ability to elicit key themes about industry structure, resources and
constraints, and divergent perceptions of relative power. It does so by helping students derive these
insights inductively, particularly as they hear from students who played other forces. Because each
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industry setting in the simulation (gourmet chocolate and e-scooters) considers five distinct events that
pose different opportunities and threats to the forces, the discussion structure suggested below is
replicated for scenario.
Gourmet Chocolate Scenario
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It is valuable to begin by examining individual choices because doing so offers an opportunity to assess
students’ perceptions of that industry’s strategic landscape for the event in question. Ask students who
played Dahlia Chocolate (the focal firm) what decisions they made, why they did so, and what they
learned from the results of these choices. For instance, in the cacao blight event, students who played
Dahlia Chocolate (the focal firm) often decide to increase or decrease production. If students indicate that
they increased production, have them explain why they did so. Their answers will likely reflect a desire
to capitalize on the potential supply-chain problems of other firms, such as those who source cacao from
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the regions affected by the blight. Conversely, ask if anyone decided to decrease production and why
they did so. Students who chose this option might have been concerned that their cacao prices would
increase significantly, without noting either that the cost of ingredients constitute a small fraction of the
price that Dahlia charges its buyers or that the blight did not affect their supplier or region from which
they sourced.
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Because strategy typically involves multiple decisions made simultaneously, it is then important to
consider the combinations of choices that students made. Effective strategies entail consistency among
choices. One potential example of inconsistency for Dahlia would be to increase its cacao order by 25%
while simultaneously decreasing its production by 25%. (The choices offered for each role prohibit
students from making obviously contradictory choices, such as increasing and decreasing production
simultaneously.) Ask students who played Dahlia whether they made the maximum of three decisions
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that they were able to. For those who did, ask whether they viewed these choices as isolated or as
complementary. If some of your students viewed them as complementary, have them articulate what
objectives they hoped to achieve through their combination of choices. For students who chose fewer
than the maximum number of available decisions, ask why they did so and whether they perceived the
choices they made as being far more important than other possible options were.
Regarding possible combinations, it bears emphasizing that students in roles other than the new entrant
can choose up to three actions for each event (the new entrant can only choose one action, due to its
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largely binary go/no-go role). This constraint is intended to make students consider carefully what they
believe will be the three most impactful—and ideally consistent—combination of actions for their role in
a limited time; requiring them to make too many choices for each event could lead to decision fatigue and
less deliberate decisions. Should any students who played the focal firm raise this issue, ask them what
other choices they would have made and why they believe those actions support the ones they made.

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For other students, the number of decisions might have felt like more than enough given the relative
brevity of each round. Ask whether any students felt this way and, if so, why they did. This line of
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inquiry offers an opportunity to discuss—and help students appreciate—the challenges that decision-
makers face while selecting multiple options under uncertainty within a short time. It may also be useful
to ask whether the prompts to explain their decisions helped them articulate their reasoning and whether
they ever changed their minds about what to choose as they did so.
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The accounts provided by students during this initial discussion should offer sufficient information for
initial conjectures about the gourmet chocolate industry and the focal firm’s power relative to the other
forces. Ask students who played Dahlia Chocolate (the focal firm) how powerful they think their firm is
and why. Ask students who played other forces, especially Bread & Circus (the buyer) and Xoco Direct
(the supplier), whether they agree with these assessments. If there is disagreement, note that you will
soon return to this topic.
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To begin transitioning your discussion from students who played the focal firm to analyzing the other
forces and the interactions among them, ask these students how much they considered the potential
responses of these other forces in their decisions. Did they, for instance, assess how Ruban de Soie (the
competitor) or Xoco Direct (the supplier) would act if they attempted to capture value? Did they see
opportunities for Spumoni Co. (the substitute) to make competitive inroads for a given event, and did
they do anything to foreclose such opportunities? Students typically focus almost exclusively on their
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own force during the first event; they begin to consider the interests and potential actions of other forces
only after simulation feedback suggests they should do so.
Continue this transition by asking students who played Ruban de Soie (the competitor) which actions
they chose. Although there are strong similarities between the focal firm and its competitor, having
additional voices enter this conversation helps to highlight potential differences in responses and
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different paths to success. Some students, for instance, may have decided to focus more on enhancing
marketing during the cacao blight, yet achieved similar success as did those who focused on supply and
production. Such examples provide students an important lesson about the potential for different firms in
the same industry to succeed, particularly when they develop distinctive, consistent strategies with
mutually reinforcing decisions.
As you open the discussion to other forces, the conversation should get livelier. For instance, when
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Xoco Direct (the supplier) and Bread & Circus (the buyer), the forces directly in Dahlia’s value chain,
enter the conversation, some short role plays can make these points more salient. In the gourmet
chocolate industry, it should be apparent that Bread & Circus has considerably more power than any
other force does. Nonetheless, students playing the focal firm and its competitor who increased their
prices to Bread & Circus may be surprised to find that their attempts to do so worsened their position.
Have students who played Dahlia attempt to justify this price increase to students who played Bread &
Circus and see how the latter students respond to the former. After these conversations conclude, help
the students articulate key economic factors behind Bread & Circus’s power; it can readily switch
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suppliers, no one supplier—especially one that sells artisan chocolate—provides more than a small
fraction of its goods, and it enjoys substantial economies of scale and scope
Similarly, have students who played Dahlia and Xoco Direct perform a role play when the latter lowers
its membership standards. This exercise should demonstrate that one of Dahlia’s key points of
differentiation is its use of high-quality cacao that is ethically sourced.

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Based on this discussion and their force’s results, students should be capable of articulating some
insights about each force and the industry. Yet they might do so more colloquially, rather than in the
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economic language an executive would use. Thus, during this conversation, you may need to translate
their comments into more abstract language about the industry’s structure, the constraints faced by
certain players, the relative strength of these forces, etc.
After establishing this baseline of understanding, students can better explore the implications of these
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insights. For instance, they might note the danger of attempting to exert leverage over a more powerful
buyer or supplier. Similarly, those who played Bread & Circus will likely see that the actions of other
forces affect it only minimally. Conversely, Vu Ventures’ (the new entrant) lack of resources beyond
funds to invest means that major industry events seldom provide good justifications for these firms to
enter.
If your students have played multiple events, they might have noticed substantial variance in how
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much different events affected their forces. Ask them to what extent they believe this variance reflected
the nature of the event relative to their specific decisions. Some students might be surprised, for instance,
that although they made good decisions, their force’s strength declined. Ask them whether they can think
of real-life examples where similar outcomes might occur. If they cannot think of any, suggest the power
of such events as severe inflation and problems with supply chains that can dampen the results of even
the best-run firms. Conversely, note that sometimes industry forces are so conducive to profitability that
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even average firms look extremely successful.
Students might have also experienced situations when their force’s decisions were negated by other
forces’ choices. They might, for instance, have perceived an event as a reason to scale back, while other
forces attempted to expand their scope. Were they surprised at the consequences of their decisions?
Conversely, were they surprised at how other forces fared? Do they understand why other forces acted as
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they did, and why those decisions affected their own force?
Based on this discussion, students can begin to induce some factors that make an industry attractive to
enter. Ask them if the gourmet chocolate industry is an attractive one to enter and why.
Short-Term E-Scooter Rental Scenario

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It is valuable to begin by examining individual choices because doing so offers an opportunity to assess
students’ perceptions of that industry’s strategic landscape for the event in question. Ask students who
played Veratti (the focal firm) what decisions they made, why they did so, and what they learned from
the results of these choices. For instance, in the battery shortage event, students may decide to increase or
decrease fare price for e-scooter rentals. If students indicate that they lowered their prices, have them
explain why they did so. Their answers may reflect a desire to capitalize on the potential supply-chain
problems of other firms, perhaps grabbing the opportunity to gain market share as others’ prices increase.
Conversely, ask if anyone decided to increase prices and why they did so. Students who chose this option
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might have been concerned that the cost of new e-scooters would increase significantly, and wanted to
cover those costs.
Because strategy typically involves multiple decisions made simultaneously, it is then important to
consider the combinations of choices that students made. Effective strategies entail consistency among

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choices. One potential example of inconsistency for Veratti (the focal firm) would be to increase its e-
scooter order to increase the fleet, while simultaneously launching into alternative product lines such as
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bikes or cars. (The choices offered for each role prohibit students from making obviously contradictory
choices, such as increasing and decreasing production simultaneously.) Ask students who played Veratti
whether they made the maximum of three decisions that they were able to. For those who did, ask
whether they viewed these choices as isolated or as complementary. If some of your students viewed
them as complementary, have them articulate what objectives they hoped to achieve through their
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combination of choices. For students who chose fewer than the maximum number of available decisions,
ask why they did so and whether they perceived the choices they made as being far more important than
other possible options were.
Regarding possible combinations, it bears emphasizing that students in roles other than the new entrant
can choose up to three actions for each round (the new entrant can only choose one action, due to its
largely binary go/no-go role). This constraint is intended to make students consider carefully what they
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believe will be the three most impactful—and ideally consistent—combination of actions for their role in
a limited time; requiring them to make too many choices for each round could lead to decision fatigue
and less deliberate decisions. Should any students who played as Veratti (the focal firm) raise this issue,
ask them what other choices they would have made and why they believe those actions support the ones
they made.
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For other students, the number of decisions might have felt like more than enough given the relative
brevity of each round. Ask whether any students felt this way and, if so, why they did. This line of
inquiry offers an opportunity to discuss—and help students appreciate—the challenges that decision
makers face while selecting multiple options under uncertainty within a short time. It may also be useful
to ask whether the prompts to explain their decisions helped them articulate their reasoning and whether
they ever changed their minds about what to choose as they did so.
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The accounts provided by students during this initial discussion should offer sufficient information for
initial conjectures about the e-scooter rental industry and Veratti’s power relative to the other forces. Ask
students who played Veratti how powerful they think their firm is and why. Ask students who played
other forces, especially Mia Rossi (the buyer) and Haegi (the supplier), whether they agree with these
assessments. If there is disagreement, note that you will soon return to this topic.
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To begin transitioning your discussion from students who played Veratti to analyzing the other forces
and the interactions among them, ask these students how much they considered the potential responses
of these other forces in their decisions. Did they, for instance, assess how Escapada (the competitor) or
Haegi (the supplier) would act if they attempted to capture value? Did they see opportunities for Fastda
(the substitute) to make competitive inroads for a given event, and did they do anything to foreclose such
opportunities? Students typically focus almost exclusively on their own force during the first round; they
begin to consider the interests and potential actions of other forces only after simulation feedback
suggests they should do so.
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Continue this transition by asking students who played Escapada (the competitor) which actions they
chose. Although there are strong similarities between the focal firm and its competitor, having additional
voices enter this conversation helps to highlight potential differences in responses and different paths to
success. Some students, for instance, may have decided to focus more on enhancing marketing during the
battery shortage, yet achieved similar success as did those who focused on fleet size and pricing. Such

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examples provide students an important lesson about the potential for different firms in the same
industry to succeed, particularly when they develop distinctive, consistent strategies with mutually
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reinforcing decisions.
As you open the discussion to other forces, the conversation should get livelier. For instance, when
Haegi (the supplier) and Mia Rossi (the buyer), the forces directly in Veratti’s value chain, enter the
conversation, some short role plays can make these points more salient. In the e-scooter industry, Veratti
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and Escapada have the most power, followed by Haegi (the supplier) and Laiz (the new entrant, a major
company subsidiary). Fastda (the substitute) is weak in this industry, and students playing the Uber-like
company who attempt to steal e-scooter market share may be surprised to find that their attempts to do
so worsened their position. Have students who played Fastda attempt to justify those actions to students
who played Mia Rossi. After these conversations conclude, help the students articulate key economic
factors behind the industry firms’ power; they fulfill a specific user’s need and habits, and a rideshare
platform fulfills a different market.
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Based on this discussion and their force’s results, students should be capable of articulating some
insights about each force and the industry. Yet they might do so more colloquially, rather than in the
economic language an executive would use. Thus, during this conversation, you may need to translate
their comments into more abstract language about the industry’s structure, the constraints faced by
certain players, the relative strength of these forces, etc.
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After establishing this baseline of understanding, students can better explore the implications of these
insights. For instance, they might note the danger of attempting to exert leverage over a more powerful
buyer or supplier. Similarly, those who played more powerful forces will likely see that the actions of
other forces affect it only minimally. Laiz’s (the new entrant) large corporate backing provides the
resources to allow it to enter the market or take some market testing option, no matter the major industry
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events in play.
If your students have played multiple rounds, they might have noticed substantial variance in how
much different events affected their forces. Ask them to what extent they believe this variance reflected
the nature of the event relative to their specific decisions. Some students might be surprised, for instance,
that although they made good decisions, their force’s strength declined. Ask them whether they can think
of real-life examples where similar outcomes might occur. If they cannot think of any, suggest the power
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of such events as severe inflation and problems with supply chains that can dampen the results of even
the best-run firms. Conversely, note that sometimes industry forces are so conducive to profitability that
even average firms look extremely successful.
Students might have also experienced situations when their force’s decisions were negated by other
forces’ choices. They might, for instance, have perceived an event as a reason to scale back, while other
forces attempted to expand their scope. Were they surprised at the consequences of their decisions?
Conversely, were they surprised at how other forces fared? Do they understand why other forces acted as
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they did, and why those decisions affected their own force?
Based on this discussion, students can begin to induce some factors that make an industry attractive to
enter. Ask them if the e-scooter rental industry is an attractive one to enter and why.

Additional Discussion Questions
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The following questions are discussion prompts that could be extended to take up an entire class session.
They are also listed in the simulation debrief decks (HBP No. 7884 and 7902) that can be downloaded
with run data from the facilitator side of the simulation or accessed on the HBP Education website.
1. What did you learn about each role? Did your understanding of the roles change or stay stable
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throughout each event in the simulation? (Focal firm, supplier, buyer, competitor, substitute, new
entrant)
2. Describe the industry’s structure: concentration, constraints, dependencies. You responded to an

industry assessment to rate the forces’ power as high, medium, or low. Did your assessment
change as you played through different events? Why or why not?
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3. Which force seemed to hold the most power in the industry? Why would you pick that force?
What could this mean for other forces in the industry?
4. How did you feel about the relative changes in power that the entire group’s decisions caused
after each event? Were there any outcomes that were a surprise or that confused you?
5. Were there any environmental shifts at the beginning of each event that seemed to have a large
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effect on your force? Which ones? How did they threaten your position or create opportunity for
you?
6. Did the consequences of any of your event decisions surprise you?
7. How did you feel in your role? Powerful? Powerless? Why?

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8. Describe an occasion when you considered other forces an what they might decide to do before
submitting your own decisions.
Focal firm and competitor: How often and in what ways did you consider each other?
Focal firm and competitor: How often and in what ways did you consider the substitute or
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new entrant?
Substitute: Did you consider the focal firm and competitor in the industry while making
decisions? How so?
New entrant: Did you consider the focal firm and competitor in the industry while making
decisions? How so?
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9. What makes an industry attractive to enter? Was this an attractive industry? What features make it
attractive? Are the conditions of the industry so bad that you would suggest exiting the industry?
When would you consider it time to exit an industry?

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10. Questions for the focal firm: How would you describe the relationship with your buyer and
supplier? Did you view them favorably or unfavorably? What level of negotiation power did you
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think you had with each of them? Why?
11. What changes in inventory levels or production volume did you make during the simulation?
What caused you to make those changes? In hindsight, were these wise choices in the long term?
Why?
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12. Which of your decisions would have been considered part of your company’s marketing choices?
What decisions did you make in your value chain to support those marketing choices?
13. What is your biggest takeaway from this simulation? How might this change the way you see
competition or relationships between industry players?
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14. Take your role and sketch your own set of five forces with examples of companies that might fit in
each of these roles in a different industry. How would this industry’s structure differ from the
scenario you just played through?
Wrap Up
If the class has covered other related material before playing the simulation, you can reference it by
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asking, Based on the understanding you’ve gained from playing the simulation and the discussion, is the
industry in question attractive? Why? Would you enter that industry?
Conclude the discussion by asking students for their biggest takeaways from the simulation. Some key
themes that often come up are as follows:
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• The power of structural forces.
• The value of understanding your own force’s opportunities and constraints.
• The value of being adaptable—a response that works for one event might not work for others.
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• The need to account for other forces’ interests, strengths, and weaknesses.
• The importance of understanding how the interaction among forces can affect the creation and
capture of value.
The Five Forces Model

The goal of this model was to present a narrative rich enough to engage users in their own role’s
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storyline, but simple enough that the fundamental learning objectives aren’t lost in the “noise” of a
deeply modeled system.
The model uses a shorthand metric, displayed purely visually in the changing size of the bubbles which
represent each force in the industry diagram, to abstractly represent power and financial position. Each
event begins with the forces represented with the same size bubble (meaning, their respective

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power/position metric is hidden). As the exogenous events are presented and the forces contend with
each other to capture value in the face of changing circumstances, the forces’ bubbles changes size
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proportionately to the power that each force possesses.
For example, if a force with a great deal of power is subjected to an increase in cost by a weaker
supplier, the outcome of that event will show that powerful force with a very slight decrease in position
(assuming no other major effects from the rest of the forces). If, however, a force has a starting position
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much weaker than its supplier, that supplier’s increase in its price to the weaker force will cause the
weaker force to decrease much more dramatically (again, assuming no other meaningful effects from
other forces, in aggregate).
The purpose of setting all forces to the same visual size in the diagram is to disguise the “real” size of
the force. Users are observing the relative effects on the forces over the course of the selected events, and
must infer from their observations the respective levels of power that each started out with. After the
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final event is played and analyzed, students should have a sense of how large, medium, or small the role
these forces actually are.
1. Because all users in a “world” submit their decisions at once, there is no intermediate
opportunity for some users to see others’ actions before making their own choices. So the
students must anticipate what they believe their counterparts will do as they plan their own
moves. Similarly, there is no opportunity to negotiate or bargain with each other within the
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simulation.
2. All users are granted the execution of their decisions. That is, there are no decisions which fail
to meet the letter of their descriptions (“Raise prices…,” “decrease monthly order…,” etc.). For
this reason, some decisions include wording such as “attempt to negotiate…”; the attempt
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occurred, but in the case of a negotiation initiated by a weak force against a stronger force, the
attempt may not have been successful.
An example from the model goes as follows: In the gourmet chocolate scenario, there is a Cacao Blight
event; a supply-side problem results in a shortage of raw materials for the focal industry, chocolatiers.
One of the decisions available to chocolatier Dahlia Chocolate, the focal firm, is to increase chocolate bar
production by 25%. This decision drives the following mechanics within the model:
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Dahlia: Increase product by 25%
• Mutually exclusive with decision “Decrease production by 25%”

• Awards a score of +1 to the user/team playing that role
• Has the following effects on all forces’ positions
o Focal Firm (Dahlia): +1, “Increase”
o Competitor: -1
o Supplier: no effect
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o Buyer: no effect
o Substitute: -0.25
o New Entrant (if this role decides to enter the industry): -0.5
• Explanation of effects provided in the Analysis and Outcome sections: “The supply shortage
among other competitors leaves potential to gain market share if Dahlia can produce more to
fill demand.”

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The above sample is just one of about 750 individual decisions available across all roles and events,
across both scenarios. The primary purpose of this model is to tell a story, which is to some extent a
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subjective account of what the effects (both singular and aggregate) of the real-time decisions of the forces
have been, and why. It is not an elaborately modeled economic system which provides enough starting
information for a user to make only optimized decisions. Some decisions have unexpected outcomes that
students should not be expected to be able to anticipate.
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It is important to remind students that this simulation does not accurately assess their business acumen.
Instead, draw their attention to the aspects of the simulation which demonstrate the Five Forces
framework at work: the interactivity between forces, the apparent disparity between their positions of
power, and the reasons that the industry is or isn’t an attractive one for a new entrant.
Leaderboard Calculation
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As mentioned earlier in this teaching note, the leaderboard is provided as an option because students
often seek out some indication of their performance against their peers. However, the leaderboard
ranking should not be considered an indicator of how much of the Five Forces framework the students
understand, or how deeply engaged they were during play. The post-run class debrief or a post-run
assignment is a better assessment tool.
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The two metrics that are tracked in a student’s simulation run are percentage of decisions made which
are considered optimal (all decisions denoted as having a positive, negative, or neutral effect on the
decision’s actor in the model) and the percentage of optimal analyses made of the decisions presented to
them in the Analysis section. Those metrics are listed in the leaderboard in the Decisions and Analysis
columns, and are categorized as “Excellent” (67%+), “Good” (34–66%), and “Suboptimal” (0–33%).
Students will only see their performance as Excellent, Good, or Suboptimal, and will not see the
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corresponding calculations behind it. The same three categories are used in the Weighted Performance
column, which represents the two metrics weighted at 2/3 the Decision score and 1/3 the Analysis score.
This weighted metric is what determines the order in which the users appear on the leaderboard.
The rationale behind using the labels Excellent, Good, and Subpotimal rather than a numbered score
was to de-emphasize the quantitatively-driven aspect of the underlying model. The learning experience
should focus on the narrative of the industry and the interactivity of the forces, not assess students’
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business acumen.
One risk of this weighting and labeling method in the leaderboard is the slim possibility that a user
with higher-ranking labels (e.g., Excellent, Excellent, Excellent) may fall below a user with a set of
seemingly lower-ranking labels (e.g., Excellent, Good, Good). This is a result of the numeric values
behind the labels, and is an edge case which may prompt inquiry in the classroom.
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Teaching the Simulation in an Online Setting

Because simulations are inherently online experiences, a simulation can seem to students like a natural
extension of an online learning environment. As more and more courses shift online, instructors often
have to adjust the way they teach certain materials in an online classroom rather than a physical

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classroom. To aid in this, we have some suggestions to hopefully ease the use of this simulation in an
online setting.
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Setting Up the Simulation and Preparing Students
Most of your simulation setup will function exactly the same as it would if you were teaching on campus.
Prior to play, you will still make your customization choices and set up students as single-players, solo
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players, or in teams the same way you would normally.
If you choose to have your students play as teams during synchronous class time, consider if you want
to move the teams to breakout rooms yourself or if you’d rather teams set up their own video calls to
play. If the latter, make sure to tell students who is in their teams. If you don’t want to facilitate video
calls, the students are able to communicate with other members of their team via the simulation’s chat
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feature.
If playing during class time, you will be available for your students if they run into any technical
trouble or have questions about the simulation. If necessary, you can have students in a world start play
without a student who might need help troubleshooting a problem. Because the sections in the events are
timed, if a student has a technical issue the simulation will still pull everyone in a world along as the
timers run out. Once the problem is solved, the simulation will bring the student to the same event the
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rest of their world is in. If a student joins play late, they will be brought to whichever part of the
simulation the rest of their world is in.
If you choose to have your students play outside of class time and only do the debrief synchronously,
you should only assign students as either solo players or single-players. If you choose to have students
play as single-players, make sure to tell them who else is in their world and instruct the worlds that they
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must set a time to play together.
Practical Considerations When Students Play in Teams Online
The fact that students playing in teams are not generally in the same place physically when they play
online has practical implications that instructors should probably point out when they introduce the
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simulation:
• Only one student can enter choices into the simulation at a time, but students can take the
“Editor” role at any time from their teammates.
• This means students playing in teams will need to agree who will control the decisions, to avoid
wasting time in conflict over decision control.
Playing in an Asynchronous Manner

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The primary advantages of structuring the learning experience asynchronously include the following:
• More efficient use of live class time; obviously, if students play the simulation as homework and
the live class is primarily a debrief experience, it costs less in terms of class time to have student
play the simulation.

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• The convenience for students of self-pacing. They get to choose when to play and—if you have
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turned off the timers—take as much time as they want; some students may learn more when they
do not feel rushed, and many students prefer self-pacing.
During Simulation Play
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If your students are playing synchronously, you can monitor their progress via the Run Progress screen
on the facilitator side of the simulation. If you assigned students to play in teams and you’d like to
observe specific teams’ conversations, consider joining breakout rooms to listen to their discussion. Note,
instructor observation could alter the nature of their conversation.
Debriefing the Simulation Online
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The debrief outlined earlier in this teaching note will still work well in an online setting as it is primarily
discussion-based. If during the content portion of the conversation you would like to write student
responses on a “board” there are a few ways to do this. One would be to share your screen and type
student responses in a Word or Google document. Another would be to have a live Google document
that is accessible to the whole class where students could write their own responses in the appropriate
categories. Finally, if you are working from a tablet with a stylus you could hand write answers for them
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to see.
If students are hesitant to respond to questions in an online classroom, we would suggest looking at the
student data on the facilitator side of the simulation to choose students to call on. The debrief PowerPoint
deck will also input the class results for all forces in all events as well as the overall responses the
industry assessment. Hopefully, once a few students have responded that will help prompt others to
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participate.
Final Thoughts about Online Play
If you choose a mode of play in which students play unsupervised (i.e., asynchronous solo play), you will
probably want to provide students with a list of questions to keep in mind as they play that signal to
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them how to prepare for debrief sessions.
While there are many choices that instructors might make in using this simulation online that we
would encourage, there is one choice that we would not endorse: skipping the debrief or carrying the
debrief out in asynchronous mode. While the game play can certainly be asynchronous, we believe that
an instructor-facilitated debrief is essential, and that a debrief results in better learning outcomes in a
synchronous mode. In a live session debrief, the instructor can direct the group’s focus and coax out
learning that comes from comparing student experiences. Students left on their own will probably not dig
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deeply or compare broadly enough, especially without hearing from classmates who played different
forces. The model that underlies this simulation is complex, and we find that the students do need active
help in inferring valid takeaways from their simulation experiences.

Technical Guide
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Adopting the Simulation and Enabling Student Access
The Harvard Business Publishing Education website allows you to distribute course materials—including
simulations—to students through online coursepacks. Detailed instructions on creating and managing
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coursepacks can be found on our site help page: https://hbpacademichelpcenter.zendesk.com/hc/en-us.
STEP 1: ADD
Add the simulation to a coursepack along with other HBP materials.
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• Search for the simulation on the Harvard Business Publishing Education website (http://hbsp.harvard.edu)
and add it to a new or existing coursepack.
STEP 2: ACTIVATE
Activate your coursepack to gain access to the simulation as a facilitator.
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• During the activation process you can determine payment mode (student-pay or institution-pay) and set
course information (course level, and so on).
• The activation process produces a unique coursepack link that you can email to students or post so they can
access—and purchase, if using student-pay mode—the simulation.
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• The activation process also provides a Manage Simulation link that grants access to the simulation as a
facilitator.
STEP 3: DISTRIBUTE
Distribute the coursepack link to students so they can enroll.
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• When students go to the coursepack link, they will reach a login screen to the Harvard Business Publishing
Education website (if students have an existing account, they can use it to log in; otherwise, they can complete
a brief registration to create an account).
• Student-pay: After logging in, students pay for the materials in the coursepack.
• Institution-pay: After logging in, students are automatically enrolled in the coursepack.
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• Once enrolled in the coursepack, students automatically appear in the simulation.
• If students click “Run Simulation” in their coursepack prior to the simulation being set to open, students will
see the following message: “The simulation is closed by the facilitator.”

STEP 4: CONFIGURE
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Configure the simulation for your class.
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• Click “Manage Simulation” from your coursepack view.
• Go to “Setup” to configure the simulation.
• In the Setup tab, go through the four sections (Users, Events, Experience, Run) to set up a new run. The
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class can play multiple runs of the simulation, but only one at a time.
• Make sure to set up students as solo players (against computer players), single-players (against each other in a
world), or arrange teams within worlds in the Setup Users tab before opening the simulation. You can choose
to auto-assign students or manually assign their force and team (if applicable) with the Custom option.
• Customize the simulation as desired: choose three or five events, choose which scenario to use, and choose
whether to include optional features such as reflection boxes and the industry assessment.
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• Open the simulation for play or open the simulation in stages. When students are finished, begin the debrief.
Help Resources
Tips to Optimize Computer Performance During a Simulation
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1. Restart your computer. Computers that have not been restarted in a long time can run slowly. A restart will
help your computer’s speed and your overall simulation performance.
2. ONE browser + ONE tab. Simulations work best with only one browser and one tab open. Opening the
simulation in more than one browser or tab has a negative impact on performance and on your data.
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3. Clear your cache. Clearing your web browser’s cache can help eliminate any potential issues. This is especially
important if students have opened the simulation before or previously played a different simulation on the
same machine. Instructions can be found here: http://forio.com/hbp-support/how-to-cache.html
4. Close all other programs and browsers. Running fewer programs allows your computer to devote more
speed to the simulation.
5. Turn off other wireless devices. Multiple devices simultaneously trying to access the wireless connection at
the same time can weaken the network strength. You may also have devices that are holding on to connections
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from other distant locations. Shut off the wireless connections on all your devices and turn it back on for the
device you will be using for the simulation.
For technical and account support, contact Harvard Business Publishing Customer Support:
WEB: http://hbsp.harvard.edu/contact-us
E-MAIL: techhelp@hbsp.harvard.edu
PHONE: 1-800-810-8858 (+1 617-783-7700 outside the United States and Canada)
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FAX: +1-617-783-7666
Please visit our website for the latest device technical requirements http://hbsp.harvard.edu/tech-specs

Simulation Overview
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Student User Screens
Welcome Page
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Once users enter the simulation they are brought to the Welcome page. Before the facilitator opens the
simulation, a message will let users know that the simulation is not yet open. Once you open to Prepare
or Play, the “Begin” button is clickable for students.
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Industry Information
Once the simulation is open, students will be able to access all of their introductory information. The
facilitator may choose to restrict students to Prepare only, which would allow students to see information
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about the industry and their role in the simulation. They learn about the industry first, by clicking
through the industry diagram for short bios about each force.
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If the facilitator chooses, they can include an optional Industry Assessment after the students learn
about each of the forces in the industry. The option to include it or not can be found on the Setup
Experience tab on the facilitator side of the simulation. In the assessment, students determine if they think
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each force has high, medium, or low power in the industry based on the information they have so far.
This assessment is identical to the one students will fill out after they complete all assigned events in the
run.
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Role
After learning about the different forces in the industry, students will see a pop up telling them which
role they are playing.

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After clicking “OK”, students will see the details of their specific role in the industry.
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Once they learn more details about the role they are playing, students will fill out a Knowledge Check
to determine how well they understand their role within the industry.
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Tutorial
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After they have gone through all of the industry and role information, students will immediately see the
tutorial. The tutorial walks students step-by-step through the different elements they will interact with in
the simulation. They can always return to the tutorial through the three dots in the upper right corner.
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Events Center
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After going through the tutorial, students will arrive at the Events Center. Each event can be opened after
the one prior is completed, and students can review their decisions from past events by returning to the
Events Center through the menu in the upper right.
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The first student to click “Get Started” for any event will see a pop up confirming that they want to
start the event for all players in their world.
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Menu
There is a menu in the upper right of the simulation that students can access at any time. From the menu,
students can access the industry and role information from the beginning of the simulation, the Events
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Center, and the leaderboard (if enabled).

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Student also have access to settings from the menu, where they can opt to switch from dark mode to
light mode, or to turn the animations in the simulation on or off.
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Event Decision Section
Once a student opens an event, they will see a modal with the event description on it. They can return to
the event description at any time from the “Description” button at the upper left.
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Once they have read the event description, students will see a list of decisions they could make in
response to the event. Each force except the new entrant can make up to three decisions for each event—
the new entrant can only make one decision for each event. There are also optional reflection boxes for
students to describe how they feel about their choices and if they would have made alternate ones.
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The Decision section has a 10-minute timer running as soon as a student opens the event. They can see
the timer right below the Event Decision label at the top left. Facilitators can choose to extend the timers
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by 50% if needed. Facilitators can also choose to run the simulation with no timer only if students are
playing as solo players with computers playing the other forces.

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Once students click “Submit” they will see a pop up confirming their decisions.
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After a student has submitted, they will see an Up Next modal that lets them know what is coming in
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the next section and which other forces have already submitted their decisions. Students can only move
to the next section after all forces have submitted or the timer runs out.
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Event Analysis Section
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In the Analysis section, students will consider actions taken by a few forces in response to the event and
determine if the actions increased the force’s position, decreased it, or if there was no change. It is
possible for students to see some of their own decisions in this section.
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The Analysis section has a five-minute timer that can be seen just below the Event Analysis label at the
top left.
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Event Outcome Section

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In the Outcome section, students can see how well they weathered the event in comparison to other
forces in the industry. The diagram will adjust each force’s size based on their position after they all made
decisions. If students click on the different forces in the diagram they can see the decisions that were
made and if they increased, decreased, or did not change that force’s position. Just like the Analysis

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section, the Outcome section has a five-minute timer that can be seen just below the Event Outcome label
at the top left.
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If students want to return to the Analysis section to remember their responses to forces’ decisions they
can do so by clicking the “Return to Analysis” button at the bottom right.
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Once all students have finished reviewing the Outcome section, either by clicking “Continue” or the
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timer running out, the next event will be available to start in the Events Center.
Final Industry Assessment
After students have played through all of the events they will see a Final Industry Assessment. Here they
will assess the power of each force in the industry based on the experiences they had while playing
through the simulation. If facilitators chose to have students fill out the industry assessment at the
beginning of the simulation as well, comparing the two assessments should reflect changes between the
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two.

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Final Reflection
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At the very end, students have the option to fill in a final reflection about their simulation experience. The
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reflection is optional and not filling it out does not prevent them from reaching the end, but could be
useful for students.
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Leaderboard
If the facilitator has chosen to activate the leaderboard, students will be taken to it at the end of the
simulation to see how they fared compared to their classmates. If you opted not to use the leaderboard
for the whole class, students will only see their information. They can also access the leaderboard at any
point in time during simulation play via the menu at the upper right.

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If students click “Continue” from the leaderboard, they will be returned to the Events Center where
they can go into each event and review their decisions and analysis if they want to. This could be useful
during the debrief.
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Team Play
In team play, students wills see their team members when they receive their role assignments.
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One person for each team is the editor. That person inputs decisions for the team. Other players will see
all choices and changes being made in real time but cannot make changes or click submit. Students can
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see who the editor is by the pencil icon on the right side of the page just below the menu.
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A student can take control of the editor role at any point in time. If the editor role is taken by another
student, they will see a warning pop up before confirming that they want to become the editor.
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After a new student becomes the editor, all players on the team will receive a notification at the top of
the page informing them of the change.

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Teams also have the ability to chat within the simulation. The decisions that they make for each event
will also appear in the chat.
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Two Scenarios
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Facilitators can choose between two scenarios for the simulation, the gourmet chocolate industry and the
short-term e-scooter rental industry. This is the Events Center for the e-scooter scenario.
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Light Mode
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Both scenarios are available in dark mode and in light mode. This only affects the color scheme in which
the simulation is displayed, students can switch between the two as they prefer. Dark mode is the default,
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but if students want to adjust their screens to light mode they can do so from the settings tab in the menu
in the upper right.
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Faculty Administration Screens
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Setup Users
Facilitators begin on the Setup page which walks through the steps required to set up the simulation. To
begin, facilitators will select user configuration in the Setup Users section. This is where you will choose if
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students will be playing the different roles as teams with other teams in a world, as single-players with
other single-players together in a world, or as solo players with computers playing the other roles in a
world.
You can configure your user settings manually or with the auto-assign feature on the page. If you need
to make changes after students are assigned to different roles, use the drop-down feature to the left of the
student names to reassign them.
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Setup Events
Once you have completed setting up users, the next step is to determine how you want the events to run.
You can choose either the gourmet chocolate or e-scooter scenario on the Setup Events tab. You can also
decide if you want students to play three or five events, or if you want to customize the number and
order of events.
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If you choose to customize events, you can adjust the number of events students play and the order in
which they appear.
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Setup Experience
The Setup Experience tab is where you can make customizations for timers and optional features. The
standard timer gives students 10 minutes for the Decision section of each event, five minutes for the
Analysis section of each event, and five minutes for the Outcome section of each event. The Final
Industry Assessment also has a five-minute timer. You can choose to extend the timers by 50% if your
students need more time with the material. You can only choose to use no timer if the students are
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playing as solo players with all other roles in their worlds played by computers.
You can determine whether or not you want students to fill out an Initial Industry Assessment or final
reflection on this page. You will also decide if you want to use the leaderboard, manually open events
yourself or allow students to open them, and determine if the animations will be on or off.

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Setup Run
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The Setup Run tab is where you can see the current status of the simulation and open it for play. There
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are two ways to open, Open to Prepare, which allows students access to all of the introductory
information, and Open to Play, which opens the simulation fully.
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If you have forgotten to save any of your choices in the earlier portions of the Setup tabs, a pop up will
appear warning you about what you missed and that you cannot make changes ones the simulation is
open.

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Run Progress
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The Run Progress page is where facilitators can see which section of the simulation students are currently
in. It shows who is playing which role in which world and how far along they are in the simulation. If
necessary, you can also reset events from this page.
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Results
The Results page gives you access to student responses for the Decision section, Analysis section,
Industry Assessment, and the leaderboard. You can see this in real time as well as after simulation play is
complete. You are also able to export the data as an Excel spreadsheet or download it into the debrief
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deck.
The information on the Decision and Analysis sections can be sorted by role and event. Each of the
charts will download into the deck (i.e., you will see all choices made by all forces for all events) if you
choose to use the debrief deck.

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The Industry Assessment shows the results across the class for each force. You can choose to see what
the entire class thought about each force individually. Again, each version of this chart will appear in the
downloaded debrief deck.
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The leaderboard on the Results tab gives you the same information that students can see on the
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leaderboard if you have opted to turn it on for student play.
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Facilitator Materials
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The introductory slides can be found on the Facilitator Materials tab.

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Appendices
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Appendix A: Gourmet Chocolate Industry Force Descriptions
Focal Firm: Dahlia Chocolate
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Short Description
Dahlia Chocolate, named for a flower with chocolate-colored varietals, is an artisanal chocolate
manufacturer whose primary market is the southeastern United States. The company's products boast
Fair Trade certified cacao sources, and their marketing materials emphasize their old-fashioned approach
to handmade chocolates. End customers purchase the 2.75-ounce chocolate bars—with innovative flavors
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like chili and cherries, brown butter bacon, or gorgonzola pear—from retailers for a recommended price
of $6.99.
Long Description
Dahlia Chocolate's small-scale operation earns high return on its $700,000 in annual sales, as the unusual
flavors, promise of an ethical supply chain, and placement in high-end retailers and grocers appeal to
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customers willing to pay top dollar for what they see as a rebellion against mass food production. Even
after sourcing the cacao (the beans from which all chocolate is derived) from Xoco Direct, a Fair Trade
certified cacao farmers co-op in the Dominican Republic, adding organic and unusual flavors, and
applying a slow manufacturing process, the variable cost to produce each chocolate bar amounts to only
$0.25. Your company then sells 60% of the bars to regional organic grocer Bread & Circus, a well-
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established brand who pre-determines a per-bar price of $4. The rest of the chocolate products are sold to
individual retailers and local gift shops for $5 per bar, which they then price for resale.
Supplier: Xoco Direct
Short Description
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Xoco Direct is a farmers' cooperative which provides high-quality cacao bearing the prized Fair Trade
certification. Collecting a small annual membership fee, Xoco Direct provides technical assistance,
training, and interest-free loans to 7,500 small cacao farmers in the Dominican Republic and Ghana, who
are subsequently able to cut out the cartel middlemen of the global cacao market to trade directly with
companies such as Dahlia Chocolate. The Fair Trade certification allows cacao buyers the assurance that
farmers are paid a living wage for their harvests as opposed to the continuously diminishing prices paid
by corporate chocolate buyers and cartel nations.
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Long Description
Xoco Direct is a Fair Trade certified cacao cooperative that supplies companies in the United States and
the European Union with raw cacao. Your co-op earns $3 million in sales annually with a moderate
growth rate. You train and rely on 7,500 member farmers to produce high quality cacao according to fair

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trade standards. In return, Xoco Direct charges high prices to chocolatier buyers like Dahlia Chocolate so
that you can pay your farmers a strong per-kilogram price for cacao. By banding together in a
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cooperative, farmers are more able to set desired prices to earn a living from their harvests.
Cacao trees take several years to mature enough to produce large pods, which are then harvested,
fermented, and dried in the sun before packaging for customers. Droughts and rising global demand for
cacao are predicted to result in future widespread shortages, pushing Xoco Direct to be continuously
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expanding your membership, investing in infrastructure, and educating future generations of cacao
producers.
Buyer: Bread & Circus
Short Description
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Bread & Circus is a regional premium grocer with 100 locations across the eastern United States. The
stores offer a moderately wide range of products: dry goods, hand-picked produce, freshly baked breads
and desserts, a wide selection of luxury candies, take-home gourmet meals, and a curated selection of fine
wines. This grocer emphasizes hometown intimate customer service and positions itself as a curator of
elevated food offerings. Their efforts in customer service have earned it the Best Specialty Grocer national
award from The Atlantic Traveler magazine.
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Long Description
As a regional grocer, Bread & Circus is positioned as a niche provider of a more elevated grocery
experience. When customers walk in the door of Bread & Circus, instead of being greeted with the
industrial metal building look and pale fluorescent lights of typical big box supermarkets, they
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experience hardwood floors, the smells of newly baked breads, fragrant cut flowers, and fresh brewed
specialty coffees.
Bread & Circus is no small operation, however; you have expanded to over 100 locations in the eastern
United States. Because of your company's retail reach and comfortable profit margins, suppliers strive to
be shelved in your stores. Whereas each typical Bread & Circus supplier represents a fraction of a percent
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of your total revenue, frequently Bread & Circus may comprise a very large share of each supplier's
annual sales. Bread & Circus reserves a section of each store's floor plan for an elaborate candy shop. In
addition to an antique truck display of flowers and large apothecary-style jars of candy by the pound,
Bread & Circus carries 10 lines of chocolates from premium manufacturers such as Ruban de Soie and
Dahlia Chocolate. Most of these chocolatiers sell 3–10 different chocolate products at the Bread & Circus
stores.
Competitor: Ruban de Soie

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Short Description
Ruban de Soie is Dahlia Chocolate's principal rival in the gourmet chocolate industry. The company sells
chocolate and confections, specializing in bonbons and luxurious filled chocolate bars. Ruban de Soie has

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a commitment to fair trade sourcing and producing finished chocolates of the highest quality, using
affluent young social media influencers known for their commitment to international social causes to
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promote the products. A 3-ounce bar of Ruban de Soie's chocolate typically retails for $8 on their website,
in boutiques and major department stores, and in grocers like Bread & Circus.
Long Description
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Ruban de Soie is the brainchild of Johnson & Wales-trained confectioner Emily Rothschild, who
envisioned creating a rare moment of bliss and peace for her customers through delectable chocolates.
Your company has grown over eight years to $1 million in annual sales, and your products appeal to fans
of smooth, rich chocolate who are happy to pay premium prices to support fair wages for farmers.
Ruban de Soie sources cacao from Chocolate Be'Cause, a nonprofit organization in Indonesia that
teaches entrepreneurial skills to cacao farmers and operates as a channel for selling their cacao. Ruban de
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Soie produces most of your chocolates by hand, causing a higher per- unit variable cost structure, but you
still make each chocolate bar for about $0.50. About 20% of Ruban de Soie's chocolate sales are through
your website at $8 per chocolate bar. Major retailers like Bread & Circus provide 50% of Ruban de Soie's
annual revenue, while the remaining 30% comes from sales made in department stores and boutiques.
You sell your chocolate to these various retailers at $5 per bar, who then mark it up for their customers.
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Substitute: Spumoni Co.
Short Description
Spumoni Co. is a Wisconsin dairy creamery and ice cream producer. The company earns annual revenue
of $5 million and sells its ice creams both to restaurants and through retail channels like Bread & Circus.
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Spumoni Co. positions itself as a premium ice cream, featuring dense textures and deep, unique flavors
such as Vanilla Cabernet, Fireside Marshmallow, and Italian Flag Spumoni. Some of their products are
chocolate flavored with real cacao, others include cacao-based mix-ins. They suggest a premium retail
price for their ice cream products of $5 per pint in stores, and sell to grocers for $3.50 per pint.
Long Description
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Spumoni Co. is an industry substitute, which means that while your products are categorized in a
different industry than Dahlia Chocolate and Ruban de Soie, the products satisfy the same need for the
consumer in different ways. In essence, substitutes create a ceiling on both the prices that companies in
the gourmet chocolate industry can charge and that customers are willing to pay before purchasing the
substitute ice cream. Some of Spumoni Co.'s chocolate ice cream flavors sold at Bread & Circus, such as
Black Forest Gateau or Salted Caramel Dark Chocolate Fudge, sell just as well as some of the high-end
chocolate bars. The ice cream has been so popular in various restaurants and grocers that you have also
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launched a series of food trucks in university towns and beach areas to expand your reach and test new
flavors.

New Entrant: Vu Ventures
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Short Description
Vu Ventures is a small group of investors who have recently sold their previous enterprise, a third party
logistics (3PL) service for perishable gourmet food boxes. After noticing an unmet desire for gourmet
chocolate items and desserts to be included in these boxes, the group set out to start a new venture,
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possibly centered around gourmet chocolate. They are carefully studying the chocolate industry and have
$1.5 million that they can use to invest in a new venture. They are observing Dahlia Chocolate and Ruban
de Soie to watch how events in the market affect these current players, and are considering these events
as they decide whether (and how) to enter the gourmet chocolate arena.
Long Description
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As a potential new entrant to the gourmet chocolate industry, Vu Ventures would desire to gain market
share, acquire important resources, and earn return on your investment. Your previous experience in the
3PL industry may not directly apply to chocolate, so you are still open to interesting and timely
opportunities in several industries as forces in the chocolate environment shift. Depending on the
decision to acquire an existing manufacturer or start from scratch, you may also introduce new capacity
that would result in additional upstream demand and downstream supply.
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Vu Ventures continues to monitor changes in the chocolate industry—such as supply disruptions,
competitive moves among interesting players, and consumer preferences—to discern when would be the
best time to launch. Upon launching, you will need to build a brand name for the company and your
products among a world of aspiring chocolatiers and formidable forces. Your liability of newness upon
start up would mean that you have low bargaining power with cacao suppliers, low price bargaining
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power with distributors and retailers of any size, and limited ability to unseat or disrupt established
competition such as Ruban de Soie and Dahlia Chocolate. Any move you make would need to be
carefully considered along with shifts in demand and supply in your external environment.
Appendix B: Gourmet Chocolate Industry Event Text

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Cacao Blight
A fungus blight has befallen a portion of the world cacao crop, shrinking yields 30% for this season. This
could last up to three years. Fortunately, none of Xoco Direct’s farms, or the cacao suppliers for Spumoni
Co. and Ruban de Soie, have been affected by the blight.
Governmental Warning
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The United States’ Food and Drug Administration has issued a warning. There is a study that shows a
specific chemical in cacao causes a detrimental change in brain chemistry. The governing body now
requires that all chocolate carry a warning of this effect, while suggesting that consumer’s limit their
consumption of cacao-based products.

Global Recession
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A global economic recession hits, causing unemployment to double around the world.
Cacao Cartel
A cacao cartel has formed within two major cacao-producing countries. The new cartel has announced a
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30% increase in prices of its output, claiming this will help bring better earning and living conditions for
its farmers. This cartel controls a majority of the world’s cacao, and major buyers are in tentative support
because of its claims to help farmers. Xoco Direct is not under the direction of the cartel, but all players in
the industry will feel the global impact of this cartel’s decisions. Ruban de Soie currently purchases cacao
from a supplier in a country that is part of the new cartel.
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Contamination
A large direct chocolate competitor of both Dahlia Chocolate and Ruban de Soie has announced a
contamination of product and will miss a quarter of order fulfillment while shutting down and
remediating the plant.
Appendix C: E-Scooter Industry Force Descriptions

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Focal Firm: Veratti
Short Description
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Veratti is one of the top 10 e-scooter rental companies in Europe. They rent almost 35,000 midrange-
quality scooters in 85 cities across 16 countries. Users can locate scooters on their phones and then rent
and pay for them on Veratti’s app to save commuting time. Riders can leave the e-scooters at their
destinations, where the next rider can find them to use. In addition to some hourly employees who
charge e-scooters, the company incentivizes local riders through minutes of riding time to collect,
maintain, and charge them as well.
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Veratti charges 0.20€ per minute for riders but does not charge a base 1€ unlocking fee like most of their
large competitors. This cost is above the average 0.10€ e-scooter rental fee, but most riders are less
sensitive to price fluctuations and more ready to use e-scooters that are near their location and that they
can rent easily through a pre-installed app.
Long Description
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Founded in 2015 in Milan, Italy, Veratti has grown extremely quickly. The company has raised $1 billion
in five rounds of funding and now operates 85 fleets of e-scooters in 16 European countries. Veratti rents
stand-up e-scooters featuring headlights, optional speed controls, and larger tires, allowing for better
control around tight corners with pedestrians around. They also allow customers to leave e-scooters at
their destinations, making Veratti e-scooters especially convenient to ride. In 2019, Veratti started using
Haegi as their supplier, South Korea’s largest e-scooter and micromobility equipment manufacturer.

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Many threats in the e-scooter industry affect Veratti, such as local ordinances against e-scooter clutter,
rider age, and maximum speed. Veratti also experiences an industry-wide profitability problem with
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their business model, as the batteries in the e-scooters cannot be replaced, making an e-scooter’s lifespan
too short for Veratti to break even on it.
Supplier: Haegi
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Short Description
Haegi, founded in 2018, is the largest e-scooter supplier in South Korea. They offer seven popular product
lines and have a 10% global market share. Haegi supplies both Veratti and Escapada with their e-scooter
lines, with Escapada’s seated-option e-scooters priced at 600€ and Veratti’s line costing an industry-
average of 400€ per scooter.
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Haegi is currently the only supplier with an easy-to-operate flip-up seat. A large majority of Haegi’s
sales come from e-scooter rental companies worldwide due to their affordability and reputation for
reliability. Currently, Haegi adds a 40% markup to any e-scooters bought from their website and sold
directly to end users.
Long Description
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Haegi’s e-scooter lines vary in their reliability, charge time, riding comfort, and speed. All of Haegi’s
commercial market e-scooters feature lithium-ion batteries, anti-theft devices, digital speedometers,
extended-life motors, LED headlights, optional speed control systems, and magnesium alloy wheels for
added strength.
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The average life expectancy for a Haegi e-scooter is five months in a rental use situation, one month
longer than other manufacturers' e-scooters. For larger e-scooter rental client purchases, Haegi will also
create special modifications to their main products. Haegi started to develop a new product line of e-
bikes in 2019 to accommodate the growth in product lines of their main buyers, but put the project on
hold in early 2020 due to the global pandemic.
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Buyer: Mia Rossi
Short Description
Mia Rossi is an Italian software developer who recently graduated from university and moved to Rome.
Like other typical e-scooter renters, Mia is in her mid-20s, lives in a large city, and finds it much easier to
get to other parts of town if she occasionally rents an e-scooter. She is moderately price-sensitive when it
comes to taking an e-scooter; living in the city is expensive after all.
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Mia does pay attention to high- and low-reputation companies, as some e-scooter rental companies in
Rome occasionally neglect charging the scooters overnight, and others are well-known for dangerously
poor maintenance. Mia is a typical e-scooter user, representative of millions of others who might
regularly rent or purchase an e-scooter for their daily use.

Long Description
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Mia Rossi works about three kilometers from her flat, a distance that most days provides her with a nice
long walk to work and fresh, fragrant morning air. However, when major project deadlines make for long
work hours, walking becomes tiring if she also wants to get home at a decent time, get reasonable sleep,
and wake up in time to be back at her office to meet her team.
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Owning a car would be too much of a hassle, as there really is no affordable place to park one near her
apartment or office, so she takes an e-scooter to work two or three times a week. This gives her 20 extra
minutes in the morning before she leaves. When she’s heading out the door, she opens up both the
Veratti and Escapada apps to find out where the nearest e-scooter is to her flat. She lives about four
blocks from the nearest Escapada charging dock, but sometimes if she's lucky a Veratti rider will have left
an e-scooter even closer.
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Competitor: Escapada
Short Description
Escapada was founded in Barcelona, Spain in 2018 by American Alexander Levy to provide e-scooters for
rent in tourist destinations. Since their founding, Escapada has grown to provide a total of 30,000 e-
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scooters in smaller coastal and mountain towns across Europe and the Mediterranean.
Escapada’s point of differentiation is that they require customers to dock e-scooters into nearby
charging stations at the end of a ride. While this adds time and detracts from the convenience of the
service, it keeps towns free of haphazardly-discarded e-scooters and provides a self-sustaining charging
operation. Escapada's e-scooters have additional features such as a flip-up seat and airless honeycomb
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tires that never run flat. Escapada charges a 5€ unlock fee and just 0.07€ per minute for riding.
Long Description
Alexander Levy launched Escapada in 2018 out of Barcelona, Spain. He wanted to create an e-scooter
company without the burdening overhead of maintenance expenses and the unsightliness of e-scooters
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discarded along scenic pathways. Utilizing foot traffic data patterns, Escapada creates hotspot docks in
pedestrian-heavy areas of cities. When a rider comes to the edge of a service area, GPS on the e-scooter
alerts the rider that they need to leave the e-scooter in a nearby dock nearby.
Escapada customers sign an agreement upon registering that they are committed to keeping the cities
beautiful and bringing e-scooters back to a dock or face a 25€ fine. This keeps the need for outsourced
staff in each city to a minimum, and the e-scooters can charge while docked for the next person. This
system also convinces cities who block other e-scooter rental companies to allow Escapada to enter their
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markets and assist the company with dock placement.
Another major point of differentiation is Escapada's safer, more durable ride. Using a line of Haegi e-
scooters, they offer a version made from aircraft-quality aluminum with airless heavy-duty tires and a
flip-up seat for more stability and less leg fatigue. The e-scooters can drive about 25 kilometers (km) per

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hour and can travel 30 km on a full charge, given their larger 36-volt battery. Escapada charges a 5€
unlock fee and just 0.10€ per minute to ride.
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Substitute: Fastda
Short Description
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Fastda is a car-based rideshare service that operates in most EU countries, with coverage in cities with
populations over 250,000. The app-based platform has a goal to provide each passenger with a car in
under 15 minutes.
The expense of a 5-kilometer ride (15 minutes average) for the customer is around 10.50€. In addition to
ride-sharing, Fastda also offers a food and grocery delivery service called Fastda Essen. This product line
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is new and represents about 15% of Fastda’s total revenue.
Long Description
Fastda was founded in 2014 in Munich, Germany by three Technical University of Munich graduates who
wanted to take advantage of the ride sharing wave in Europe. To combat foreign rideshare competition,
Fastda developed several points of differentiation. One of their best features is an in-app translation
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service to help visitors navigate and communicate with drivers in countries where they do not speak the
native language. When passengers enter their destination into the Fastda app, they are given an option of
whether they would like the nearest driver to come pick them up or whether they would like to go green
by waiting for an electric vehicle.
In congested European cities, customers are likely to opt for e-scooters over ridesharing, whereas in
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smaller cities, customers often prefer ridesharing apps like Fastda over using an e-scooter to go moderate
distances. Customers also consider trains and subways for transportation to highly frequented areas.
New Entrant: Laiz
Short Description
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Laiz is a potential new entrant line to the e-scooter rental market, developed by an alternative products
research and development division of Mundare LLC, the second-largest US-based electric car
manufacturer. Recent supply chain disruption caused Laiz to consider new streams of revenue, including
the international micromobility and last-mile transportation markets.
Laiz’s high level of value chain integration has resulted in the perfect interchangeable battery for e-
scooters worldwide, a battery that would solve the profitability problems of most companies in the
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industry by extending the average e-scooter lifespan to 18 months. However, no e-scooters currently
being built have the capability to remove their lithium-ion batteries, let alone to replace them. Laiz is left
to contemplate if this is the right time to move to market, and if a full e-scooter manufacture and rental
function is the right model to use to benefit from this new battery invention.

Long Description
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In 2021, driven by microprocessor supply chain disruption, major electronic car manufacturer Mundare
LLC moved to explore other sources of revenue and international growth. The company created the Laiz
division to develop a replaceable lithium-ion battery with extended charge holding time as well as new
models of e-scooters to use them. Internal business plans on the new division and its product line have
reached completion, featuring finished prototypes, internal plans for sourcing parts, approved
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manufacturing capacity expansion plans, and options to reallocate staff from auto lines not operating at
capacity.
Laiz e-scooters offer many of the features current competitors' e-scooters have: LED headlights, rugged
tires, sturdy but light frames, and stellar speed, but their market-breaking point of differentiation lies in
Laiz’s power source. All other e-scooters on the market feature integrated lithium-ion batteries that
cannot be replaced when they stop holding a charge. Due to their relationship with their parent company,
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Laiz’s batteries are easily replaced when they have lost their charging functionality, extending their e-
scooter’s expected rental lifespan to exceed 18 months. This capability more than quadruples the current
profit a rental platform could expect from each e-scooter in the fleet. This patented feature, along with the
production of the extended life batteries, under the control of Mundare. All that is necessary is for the
market to shift in a way that opens the strategic window for Laiz to launch.
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Appendix D: E-Scooter Industry Event Text
Direct-to-Consumer
Haegi's manufacturing competitor, Finesse, opens pop-up retail stores in shopping centers across the
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European Union. They sell their own value line and seated line of e-scooters for 500€ and 750€, each,
directly to consumers. These e-scooters are of good quality, with integrated lithium-ion batteries.
Battery Supply Chain
Haegi and other leading manufacturers are experiencing a disruption in international transportation for
the lithium batteries that power their e-scooters due to problems with Back Bay Battery, a major battery
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source. Not only are they unable to meet demand and short-term orders for e-scooters, but they must also
consider increasing the prices of their e-scooters to offset increases in pricing for alternative batteries.
Partnerships with Cities
Ten major EU cities including Rome have collaborated in a Green Transportation Pact. They have agreed
that it is time to capitalize on the improvements in carbon footprint that e-scooters have over gas-
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powered automobiles. These cities are starting to subsidize e-scooter use, reducing prices to consumers
by 50% and helping rental companies collect, charge, and maintain the e-scooters.

Heightened Regulation
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The European Union, in an attempt to reduce the negative effects of e-scooter proliferation, has decided
to limit the number of e-scooters in urban areas. In addition, all rental e-scooters must now be docked
and charged at specified parking sheds and helmets must be worn while riding.
Entry of Laiz
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Spurred by predictions of moderate market growth, Laiz has been given approval to fully enter the EU
and US e-scooter rental markets using their own e-scooter lines. The strategy is to position the company
as a provider of highest quality, fastest e-scooters. They also intend to sell e-scooters to own in retail
outlets for 800€ each and to sell their rechargeable batteries to e-scooter manufacturers worldwide. Laiz
estimates that in two years, they will be able to create a global fleet of 60,000 e-scooters.
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Appendix E: The Five Forces
This section includes information about each of the forces as well as key considerations that students
should use in making decisions within the simulation.
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Power of Suppliers
All value-adding processes require inputs. The suppliers that provide these inputs can hold more or less
power relative to the customer firms that buy the inputs to make industry products. When suppliers are
more powerful than those with whom they do business, it can result in unsatisfactory terms for their
customers. Pricing, product features, production time, and product quality are a few of many
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characteristics of the exchange that could be impacted by a power imbalance. When suppliers are less
powerful than the companies they sell to, all these listed facets of the transaction can be negotiated to
favor the customer.
A few major situations can occur to cause suppliers to have greater power than the firms who comprise
their customer base in an industry. Some more common drivers for high supplier power are listed below:
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• Only a small, concentrated group of a few suppliers exists for needed inputs.
• The set of suppliers gets most of its revenue from alternate customers and industries.
• It is difficult or costly to switch between suppliers.
• Suppliers have low switching costs to do business with other customers.

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• Suppliers can differentiate their products from one another, such that desired features may
only be obtained from one or a few alternative suppliers.
• Suppliers may provide an output that adds so much value, it renders substitutes unusable or
very unfavorable.

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When a firm’s supplier holds most of the negotiation power in the relationship due to these reasons, an
unfavorable impact on profitability can follow. A few results of a power imbalance between firms and
their suppliers could be
• A buyer concedes to pay higher prices for inputs than intended because it cannot get inputs
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with that level of quality or features elsewhere.
• A customer is unable to pass on a cost increase dictated by a supplier to its consumers, who
refuse to pay the increased price to them.
• A buyer must use inputs with lower quality or reduced features than it had originally intended
to keep its costs of goods reasonable.
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• Suppliers who desire to capitalize on the profit a powerful customer is earning could develop
resources and capabilities to expand and compete with their customers in their own industry,
increasing the rivalry of competition in that industry.
As a major part of the industry analysis is not to merely identify the power of suppliers as low,
medium, or high, but to examine more closely what drivers of profitability exist in its structure, it is
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important for students and players of this simulation to pause upon having been first introduced to the
simulation characters. At this point, players should consider the relative size of the character companies,
the impact that switching suppliers could have and the reasons for that impact, and the rarity of the
inputs to the industry’s major products. Such an examination could help students more easily empathize
with their role once the rounds begin, as well as aid them in making more informed decisions.
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Power of Buyers
Just as suppliers can develop greater negotiation power in industry transactions, buyers of a company’s
products can pressure profitability from another direction. Buyers tend to affect industry profitability by
either pressuring firms to lower prices on products, request higher quality of products, or better customer
service. In industries with many sellers and fewer buyers, these buyers can work simultaneously with
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several seller firms to find the best deal. Several industry conditions can cause the power of buyers to be
higher:
• The number of potential buyers to sell to is low.
• Buyers typically purchase in high total cost/high volume purchasing patterns.
• There are few meaningful points of differentiation for competing with other sellers.
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• It is easy for buyers to switch from working with one seller to another.
• It would be relatively easy for buyers to begin producing one’s product themselves, cutting out
the need for seller firms.

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• Buyers are price sensitive due to low profit margins or tight cash reserves.
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When an industry has these listed characteristics, its firms tend to experience lower profitability and
freedom to dictate prices and product features. More often, firms will need to be wary of buyers’
expressed needs and demands. Under these conditions, when industry shifts constrain buyers’ options,
often the seller firms can find themselves pinched by both their more powerful buyers and suppliers to
partially (and sometimes wholly) absorb the profit shock of the shifts.
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Rivalry Among Existing Competitors
The rivalry among competitors refers to the sum of actions and decisions that firms take in order to lure
customers toward their product offerings and away from other competing firms’ offerings. Such actions
could include price discounts, innovative products, and marketing and design thinking around better
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meeting customers’ needs. These decisions tend to affect profitability through altering the revenue that
products bring in, and through modifying the cost of operating, producing, servicing, and marketing
products.
When the number of competitors in a specific industry is high, then the intensity of this rivalry is also
higher, usually driving profitability downward. Firms scramble to take customers from each other, a
behavior which is intensified if there is little growth in the industry. The harder it is to leave an industry
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and transfer knowledge and assets into a more open field industry, the more intense the competitive
behaviors become as well. Competitors may lower prices to try to drive volume, increase sales and
advertising budgets to become more visible to customers, or add features to products that cause them to
be more costly to produce, just to drive sales volume upward or allow them to charge more or attract
dissatisfied market members.
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Intensity of rivalry becomes especially destructive to profitability if competing firms perceive that their
main method of customer attraction is through price reduction. Lowering prices is a powerful motivator
for customers to switch vendors, especially when products are seen as interchangeable and a point of
differentiation is hard to discern between products. Ensuing price wars tend to erupt as eschewed firms
try to regain customers by lowering their own prices in retaliation. Other firms not initially involved may
find themselves drawn into this price competition as their own customers become attracted to the lower-
priced offerings, and the entire industry’s revenue begins to suffer with little to show in the way of net
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new market size. Firms that operate in industries where product is perishable, such as in food retail or
entertainment, may find price competition particularly alluring. Nonprice rivalry, such as redesigning
products to better match customer needs, is more likely to add value to industry offerings and result in
higher prices for products due to their increased value.
Threat of Substitutes
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Substitute goods or services typically exist outside of a firm’s traditional set of industry competitors and
offer a solution to the same customer need, only in a different way, such as in the case public
transportation and ride sharing. Substitute products may not offer as direct or attractive a solution, but a
customer often compares the price to value relationship between an offering and its substitutes offerings,
such as considering the prices of hailing a shared ride versus taking the public bus with the convenience
of the shared ride over finding a local bus stop in time to reach the intended destination.

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The greater the price of the original offering, the more a customer will consider whether the price
differential between the product and substitute is “worth it,” given the added benefit of the original
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offering. If the customer cannot find a rational reason to pay the price differential, the customer may
switch to the substitute. Therefore, the threat posed by substitutes places a double onus on a firm: set
pricing as an acceptable trade-off to a customer’s perceived inconvenience of using the substitute and
ensure points of differentiation from substitutes that are meaningful and valuable to customers.
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Substitute offerings provide a particularly tricky threat to firms for several reasons. First, without an
intimate knowledge of customer preferences, considerations, and behavior, a firm cannot easily discern
which alternatives would be in customers’ decision sets. Secondly, technical changes can occur in
previously irrelevant substitute industries that render their products more attractive to customers and
place them in the customer’s decision set. Finally, changes in customer behavior and priorities can make
room for previously irrelevant products to suddenly have a place in customers’ decision sets; for
example, a societal shift to work late at night might render daycare or public transportation less attractive
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as currently offered. Ultimately, the threat of substitutes requires firms to continually interact with their
customers to identify not only their buying decision parameters but also to understand their behaviors
and needs.
Threat of New Entrants

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New entrants are firms that are either considering moving into an industry space to compete or are
starting up at present. These firms could be independent ventures, but they could also be offshoots of
already existing companies in other industries, many of whom arrive with plentiful resources to compete
in the new industry. Rarely does the market size for an industry’s products immediately grow along with
the new entrant’s appearance; thus, the only way a new entrant can increase revenue is to take market
share from an existing competitor. For this reason, the arrival of new entrants increases the level of
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rivalry. As this increase in rivalry occurs, profits can decrease through reduced volume of sales or
temptations to compete based upon lower pricing.
A major theme in understanding the threat of new entrants is understanding the concept of barriers to
entry. Much like ancient city walls, the barriers to entry for new business ventures help to protect current
competitors in an industry from threats like new entrants. Some of these protections include
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• Cost savings from being able to spread fixed costs over more units produced (economies of scale)
• Strong loyalty of a large body of current customers
• The time, money, or effort it would take a customer to switch to use a new competitor’s products
(switching costs)
• Considerable resources needed to start a business in an industry

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• Current competitors’ abilities to access retail or wholesale connections to customers
• Government policy that favors some firms over others
• Expectations of major competitor retaliation in response to a startup

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When these barriers or walls are high in an industry, the likelihood of firms starting up to compete in
the industry is lower. When these barriers are mild, low, or non-existent, the threat of new entrants
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starting up in the industry is high. Thus, the threat of new entrants depends on both general industry
conditions and barriers to entry, and the resources and capabilities of firms scanning an industry for
entry.
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In summary, the Five Forces framework is used to understand the flow of economic value between
players within and stakeholders of an industry. Is it kept as return for the central competitors comprising
an industry, or is it negotiated away to channel members due to competitive conditions? When
considering the structural impact of the five forces, students should consider the role that they play amid
fleeting macroeconomic conditions. For example, if the threat of competitors is high and a governmental
policy is passed which reduces demand, how will that governmental policy affect coexisting competitors?
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How will this policy impact the desire of new entrants to go ahead and start up in these market
conditions? Upstream, how does this governmental policy change impact the suppliers of this newly-
constrained market? Considerations such as these comprise the heart of this simulation and allow
students to practice planning from the perspectives of each of the five forces’ roles.
Appendix F: Pre-Play Discussion Questions

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Optional: The roles that students will play are described within the simulation; however, some
instructors may wish to underscore this introduction with a class discussion to ensure that students
absorb facts that are important to the simulation storyline.
Q: If you were to explain the Five Forces framework in simple terms to a friend, what would you tell them?
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A: The Five Forces framework is a way to explain industry structure and economic health. By
understanding the relationships and motivations of competitors, buyers, suppliers, and others involved
with a particular industry, we can understand what makes that industry more or less profitable.
Q: What are some of the most memorable ideas that you took away from the pre-reading?
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A: Answers will vary as this is more of an icebreaker or explanation of ideas, however, students often
give these types of answers:
• When the five forces are strong, industry profitability is lower. When the five forces are weak,
industry profitability is higher.
• Buyers can erode your profitability by asking for lower pricing or by demanding products with
better features. Suppliers can damage your profitability by requiring you to pay higher prices for
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the inputs you buy or by delivering product to you with low quality or features.
• The more of any one type of player that exists in each role, the less power each individual player
has in that role against others in the Five Forces framework. For example, the more buyers exist
in the market, the less power each buyer has to demand concessions from sellers; the more

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suppliers that exist, the less negotiation power each supplier has with customers to enforce
pricing or hold back on quality.
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• Depending on the level of age or experience of students, students may express surprise that the
Five Forces model is based more on profit maximization than on corporate responsibility, or that
it seems zero-sum or ruthless in nature. It is helpful to these students to explain that adept
strategists use the considerations of the model to maintain a healthy industry structure. It is
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beneficial for customers, suppliers, competitors, potential entrants, and substitutes if industry
players consider both their own long-term profit maximization for longevity and other players’
long-term profit maximization to ensure a balance between continued supply of valuable product
and overall economic health.
Q: Describe each force. Think of one way that each one impacts the others in any given industry (Draw the Five
Forces diagram as students call out each force or use an existing diagram of the framework and point to each force as
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students explain it.)
A: Power of buyers. Buyers are the customers who purchase goods from each industry. They try to buy
goods which have needed features at low prices.
Power of suppliers. Suppliers are the firms upstream from industry members, who sell inputs, services,
or goods for resale to the focal firms. Suppliers try to negotiate the highest price possible for these
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products or try to minimize their costs to produce those products.
Threat of new entrants. New entrants include already existing firms in other industries who are
considering entry into a new industry, or nascent firms wishing to compete in the focal industry. The
threat of these entities is that they could bring new value to dissatisfied or underserved customers and
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displace current competitors.
Substitute products or services. Substitute products or services serve the same needs of the same
market but meet those needs in ways that would place them in other industries, such as busses, cars, and
bicycles all meet the same transportation needs in different ways. The existence of these substitutes places
a price ceiling on what focal firms can charge for their offerings and threatens focal firms with the
possibility of innovations that could displace them in customers’ selections.
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Competitive rivalry. Competitors are relevant firms in the same industry who solve similar market
problems with similar goods or services. They pose a threat to each other through their price offerings
and through the relevancy of added product features to customers.
Q: What is a profit maximization motive? What are some examples of things a firm within the Five Forces model
can control or manipulate to maximize its profit, relative to other forces in the model?
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A: A profit maximization motive is the desire for the firm to grow its net income as large as possible, to
reinvest in marketing, production, expansion and the like, or to return to owners as a return on their
investment. Firms can manipulate drivers of revenue or costs to improve profit maximization. Examples
of firm profit maximization behaviors could be increasing pricing to be consistent with value provided,
decreasing pricing to increase volume sold, improving product features, signing long-term contracts with

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exclusive suppliers, landing deals with nationwide retail outlets, and negotiating for lower costs with
current suppliers.
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Appendix G: Complementary Resources
Suggested Pre-Play Reading
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Casadesus-Masanell, Ramon. Core Reading: Industry Analysis. HBP No. 8101 (Boston: Harvard Business Publishing,
2014, 2022).
“The Explainer: Porter’s Five Forces.” Harvard Business Review website, June 10, 2014.
https://hbr.org/video/3590615226001/the-explainer-porters-five-forces, accessed August 17, 2022.
Magretta, Joan. What Is Strategy?: An Illustrated Guide to Michael Porter. (Boston: Harvard Business Review Press,
2020).
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Porter, Michael E. “The Five Competitive Forces That Shape Strategy.” Harvard Business Review 86 (January 2008):
78–93.
Porter, Michael E. “What Is Strategy?” Harvard Business Review 74 (November-December 1996): 61–78.
Further Reading
Anthony, Marilyn, and Shreshthi Mehta. “Urban Axes: First Mover in US Experiential Entertainment.” HBS No.
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W21102 (Boston: Harvard Business School Publishing, 2021).
Bartlett, Christopher A., Rachel Gordon, and John Lafkas. “RoboTech: Storming into the U.S. Market.” HBS No.
918-501 (Boston: Harvard Business School Publishing, 2017).
Campbell, Andrew. “The Basic Principles of Strategy Haven’t Changed in 30 Years.” Harvard Business Review web,
April 23, 2015. https://hbr.org/2015/04/the-basic-principles-of-strategy-havent-changed-in-30-years, accessed
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August 18, 2022.
Casadesus-Masanell, Ramon. Core Reading: Introduction to Strategy. HBP No. 8097 (Boston: Harvard Business
Publishing, 2014, 2022).
Costantini, James, and Dawn Jarish. “PopChef: Creating a Tasty Foodtech Business.” HBS No. IN1622 (Boston:
Harvard Business School Publishing, 2018).
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Etsy, Benjamin C., and Lauren G. Pickle. “Tempur Sealy International (A).” HBS No. 718-422 (Boston: Harvard
Business School Publishing, 2017).
“How Industry Competition Theory Can Help Fix U.S. Politics.” Harvard Business Review, April 23, 2021.
http://www.kaltura.com/tiny/0rpsm, accessed August 18, 2022.
Inkpen, Andrew C. “Tanner Pharmaceuticals and the Price of a New Drug.” HBS No. TB0477 (Boston: Harvard
Schotter, Andreas, and R. Chandrasekhar. “AutoNiche Inc.: Facing Up To Disruption.” HBS No. W20901 (Boston:
Harvard Business School Publishing, 2020).
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Simons, Robert. “Strategy Execution Module 2: Building a Successful Strategy.” HBS No. 117-102 (Boston: Harvard

Appendix H: Release Notes
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Date Simulation Changes Teaching Note Changes
August 25, 2022 Released the simulation. Released the teaching note.
Released introductory slides (HBP No. 7883),

debrief slides (HBP No. 7884 and 7902), and
Quick Start Guide (HBP No. 7882).
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Key Information ......................................................................................................................................... 6

HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 2

Final Industry Assessment .................................................................................................................... 36

HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 3

Supplier: Haegi ..................................................................................................................................... 53

HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 4

HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 5

Players/Scenarios/Roles Single player and multiplayer, two scenarios, six roles

In-Class or Out-of-Class Play Either

Accompanying/ Teaching note, introductory slides, and dynamic debrief slides

For these and other resources visit: https://hbsp.harvard.edu/product/7880-HTM-ENG

HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 6

HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 7

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3. Analyze the interaction between forces.

The Student Experience

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Post-Events Assessment and Optional Reflection

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HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 12

Preparation and Pre-Work

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Gourmet Chocolate Scenario

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HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 15

Short-Term E-Scooter Rental Scenario

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Additional Discussion Questions

2. Describe the industry’s structure: concentration, constraints, dependencies. You responded to an

6. Did the consequences of any of your event decisions surprise you?

7. How did you feel in your role? Powerful? Powerless? Why?

HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 19

• The power of structural forces.

• The value of understanding your own force’s opportunities and constraints.

The Five Forces Model

HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 20

Dahlia: Increase product by 25%

• Mutually exclusive with decision “Decrease production by 25%”

HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 21

Teaching the Simulation in an Online Setting

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must set a time to play together.

Practical Considerations When Students Play in Teams Online

Playing in an Asynchronous Manner

HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 23

During Simulation Play

Debriefing the Simulation Online

Final Thoughts about Online Play

them how to prepare for debrief sessions.

HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 24

• Once enrolled in the coursepack, students automatically appear in the simulation.

HARVARD BUSINESS PUBLISHING | Strategy Simulation: The Five Forces 25

• Go to “Setup” to configure the simulation.

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Center, and the leaderboard (if enabled).