Russian pride may just be a little hurt after the latest edition of the Global Management Challenge. The Russian Federation were the defending champions, hot favourites and the hosts of this year’s edition of the world’s biggest real-time strategy and management competition.

Instead of celebrating, they had the dubious pleasure of congratulating the former Soviet republic of Ukraine on their triumph. The Ukrainians were besides themselves, enjoying the taste of victory, made sweeter by a win on Russian soil in only their fourth time in the competition.

Sweet victory

Of the 25 participating countries in this year’s competition, only eight ever get a shot at the prize. The team of university students maintained the second highest share price throughout the final decisions of the last round and enjoyed the highest profits.

“We are unbelievably happy. I don’t know if there’s anyone happier in the world than we are now,” Ukraine’s team leader Markiin Serchynskyi told Macau Business moments after the results were announced in the oil boomtown of Khanty-Mansiysk.

The Ukrainian GMC local organiser (see Play the Game) was no less elated. “Ukraine might not always be seen for what it is but the results of today prove the country has a bright future,” said Anna Degterev.

“These young managers [competing in the local heats] are tomorrow’s leaders and they are an example to the Ukraine: that well-thought-out objectives and better results can be achieved with hard work and good decision making.”

The Global Management Challenge is the world’s biggest strategy and management competition, counting more than 400,000 participating university students and junior managers throughout its 30-plus year history. Teams of up to five members run a listed company competing to achieve the highest share price in their market by making decisions in five areas: human resources, production, sales and marketing, accounting and finance.

Top performers

The challenge saw some outstanding performances. The team from Finland
performed strongly, losing by the slimmest of margins.

The team from Turkey competed with one member short and the duo was able to secure a finals spot, beating veteran teams such as Portugal. Grinding though the five decision periods of the final, the Turks achieved the fourth highest share price of the competition.

Macau and Hong Kong had very promising starts, blasting through tough opponents in the group phase. Both the Macau team – consisting of five mainland students enrolled in the Macau University of Science and Technology – and Hong Kong – featuring three mainland students from Hong Kong University of Science and Technology – entered the second and final rounds leading their respective markets. Along the way, key decisions came up short and both SARs finished in the middle of the qualifying table.

The mainland, with an impressive track record of five Gobal Management Challenge wins since 1999, finished in sixth place overall.

Hello again

Macau will host the final in April. It will be the third time Macau has welcomed the competition since 2002 and there are some changes ahead.

Next year’s edition of the challenge will see the introduction of a new simulator that will affect major decisions in two areas. There are changes to the way competitors manipulate share transactions and steep prices will be posted for the company’s carbon footprint.

Lisbon-based company Sociedade de Modelos de Gestão, which owns and runs the global competitions, expects more than 30 countries and regions will take part, with a few first timers.

“Africa is very keen to join” said president of SDG International Committee Luis Alves Costa. This year’s final was marked by Ghana’s debut as the second African country to join the competition after Portuguese-speaking Angola.

The participation of the oil-rich country has prompted a wave of applications from neighbouring nations.  Already in the final stages of negotiations are Ivory Coast, Benin, Burkina Faso and the East African, Portuguese-speaking country of Mozambique.

Other countries already signed up and ready to compete in next year’s edition are Venezuela and Kazakhstan. Also guaranteed is Middle East participation. The members of the Gulf Cooperation Council – Kuwait, Bahrain, Saudi Arabia, Qatar, United Arab Emirates and Oman – will begin organising local and national heats next year.

Costa said negotiations were continuing in Europe, where the simulation already enjoys a high penetration rate, including Norway and Sweden. Potential ventures are being explored in Chile and elsewhere in South America.

Play the game

The competition’s simulation program is EDIT 515, created by economists at the Department of Operational Research at Strathclyde University in Scotland. Their challenge, posed by the Glasgow Chamber of Commerce 36 years ago, was to create software to test a company’s strategic management decisions. In a typical challenge, participating teams receive data from the last five quarters and have to devise a business strategy.

The global challenge has allowed thousands of youngsters a risk-free opportunity to experience being a top manager of an organisation and making the executive decisions that, ultimately, determine the company’s fate.

Heats for the challenge are organised by a franchisee of Lisbon-based Sociedade de Modelos de Gestão (SDG) in concert with media partners worldwide. In Macau, SDG Asia holds the franchise and the competition is organised by the Macau Management Association.

Sponsors include the Macau Foundation, Golden Crown Development, The Hong Kong and Shanghai Banking Corporation, CEM, Macau Government Tourist Office, the Macau Trade and Investment Promotion Institute, the Monetary Authority of Macau, BNU, CTM and AICEP Portugal.

Macau Business and Business Intelligence magazines – flagship financial publications in English and Chinese published by De Ficção Multimedia Projects – are media partners of the competition. For more information, log on to www.gmc-asia.com

Changing perceptions

Located in the heart of Siberia, the Khanty-Mansi Autonomous Okrug seems a bizarre choice to host an international competition of young and aspiring managers from the four corners of the globe.

By May, the still freezing weather is no longer drawing the massive winter sports crowds that flock to the region for its slopes. And the city itself has little more to offer the weary business traveller than the breathtaking views of forest trails and a couple of malls in the central district.

The city is an island of land surrounded by a thick forest and harsh mountains where distances to the next towns are measured in the hundreds of kilometres. The biggest avenues out here are the freezing Irtysh and Ob rivers, snaking their path to the northwest. As one organiser said: “The delegates can’t get lost here but they’re also not going anywhere.”

Hard money

Why Siberia and why Khanty-Mansiysk? Hard currency. The country is keen on changing the perceptions of the harsh, frozen steppe, with its history as a destination for party malcontents on the way to the gulag.

Today’s Siberia is the hub for one of the country’s highest denomination bargaining chips: oil, gas and mineral wealth. If Soviet-era Russia was a superpower, Siberia under the Russian Federation is, quite literally, the powerhouse. Its pipelines reach beyond neighbouring countries, supplying energy-hungry Europe and fuelling a respectable chunk of the world economy.

Khanty-Mansiysk might have been built to demonstrate the new power of the Russian Federation in the era of globalisation. As an administrative capital it does not house the thousands of workers from the oil and gas fields or mineral deposits. It does however feature the regional headquarters of the exploration concessionaires, housed on main square.

The city’s roads are wide, the children’s parks bright, but both are empty; the infrastructure is there but underused. The airport is relatively small but modern, but there’s only one flight to Moscow a day.

“It’s an abnormal city,” a Moscow-based journalist told Macau Business. It is different from other oil cities because “everything is so clean, brand new and empty” he says.

Albeit remote, the city has the infrastructure required to hold international events. Recently it has hosted the Chess World Cup and the Biathlon World Championships and the European Union-Russia Summit in 2008.

Organisational talent

The organising committee of Global Management Challenge, clearly went out of their way to ensure the eclectic delegations enjoyed the event. The game’s national organiser, the government’s Academy of National Economy, the local government and patron the Russian Ministry of Industry and Trade took charge.

While the level of service was generally good, smiles were few and far between in an omnipresent mix of austerity and apathy. But the Khanty-Mansiysk 2009 International Final did top most of the previous editions of the event covered by Macau Business.

Aside from enforcing an almost clockwork competition, organisers showed their skills by turning some of the duller sections of the official programme into warm cultural experiences.

On the other side of the spectrum, arguably to emphasise the business sense of the event, a conference of management and governance in Russia ran alongside the second and final day of competition.

The Macau Management Association, the organiser of the 2010 International Final, has its work cut out for it when it hosts the 30 teams gearing to compete in the challenge next year.

The association’s deputy secretary-general and head of the Macau delegation to Khanty-Mansiysk Paulina Luk promised a special experience: participants will be immersed in a “unique cultural business environment” where East first met West. Macau is definitely up to the challenge.