The hardest leadership leap is not from manager to director, but from leading a team to leading a function, and thinking strategically, like an enterprise leader. Many capable leaders stall at this stage because while they can manage their people well, they have had little opportunity to practice enterprise-level trade-offs and decision-making under pressure.
Traditional leadership development programs, with their emphasis on frameworks and classroom learning, rarely provide the safe but stretching environment needed to prepare leaders for this shift. Too often, leaders only learn these skills once they are already in the role, at significant cost to them, their teams, and the organisation.
Leadership simulations are immersive, scenario-based experiences that enable leaders to practice enterprise-level decision-making in a safe and accelerated manner.
Simulations change that. By compressing years of learning into days, simulations give leaders the chance to step into enterprise-level roles, face complex, real challenges happening in the business, and make the kinds of decisions they will one day be accountable for. In a safe environment, they practice weighing trade-offs, testing strategies, and learning from both successes and mistakes, with immediate feedback to accelerate growth.
The strategic case: How simulations accelerate leadership growth
Leadership simulations help address the gap that many leaders face when transitioning from leading a team to leading a function or thinking strategically at an enterprise-wide level. They do this by addressing five areas that traditional development approaches often miss.
Experiential learning that sticks – strategic and enterprise-wide thinking is one of the most complex capabilities for leaders to develop. Simulations offer hands-on, immersive experiences that replicate real-world scenarios, allowing participants to acquire practical skills they can apply immediately. Research shows participants can experience a 25% increase in learning and 20% improvement in overall job performance following effective leadership training.
Risk-free strategic experimentation – in the safety of a simulated environment, leaders can experiment with different strategies, make mistakes, and learn from failures without real-world consequences. This encourages the kind of creative risk-taking and innovation that drives competitive advantage while building confidence in complex decision-making. This is particularly valuable for emerging functional leaders, who often need to test enterprise-level judgement without the cost of learning only once they’re already in the role.
Enhanced engagement and motivation – the interactive, competitive nature of simulations captures attention and drives active participation in ways that traditional training often cannot match. As one recent participant noted: “This was one of the most valuable training sessions I’ve had. Bringing in real leaders to get their input on scenarios was a really strong learning tool.”
Real-time feedback and reflection – simulations provide immediate feedback on decisions and actions, creating powerful learning moments that promote self-reflection and continuous improvement. Participants can assess their performance, identify areas for development, and adjust their strategies in real-time.
Systems thinking development – most importantly, simulations require participants to shift from a team’s lens to an enterprise lens, considering multiple variables, interdependencies, and consequences simultaneously. This helps develop the systems thinking and strategic perspective essential for leadership roles in enterprises.
Where simulations deliver maximum impact
Leadership simulations can be particularly valuable in six key organisational contexts:
- Strategic shifts or transformations – when organisations need their next generation of leaders to step up from team-level roles to functional roles and understand new strategic priorities and trade-offs
- Extended leadership team development – building enterprise thinking across broader leadership populations beyond the C-suite
- Strategic planning processes – “war-gaming” strategic choices and decisions as input to broader planning cycles
- Integrated leadership programmes – enhancing existing development initiatives with high-impact experiential components
- High-potential talent development – providing emerging leaders with executive exposure and strategic thinking opportunities
- Strategy cascade and alignment – helping leaders at all levels understand and debate strategic choices through scaled simulation experiences
Inside SMG’s leadership simulation approach
What makes the SMG approach distinctive is its focus on preparing team leaders for enterprise responsibility. Our simulations are designed not just to test decision-making but to accelerate the transition from operational to strategic leadership.
SMG’s leadership simulation creates a challenging and engaging development experience tailored to your organisation’s specific strategic context. Participants work in cross-functional teams of 5-7, taking on C-suite roles including CEO, CFO, CIO, and Chief Customer Officer to tackle strategic and tactical business challenges.
The format is deliberately intensive: teams compete over a full day to deliver maximum business value across multiple stakeholder dimensions, working to ensure sustained commercial success across multiple business cycles. Each scenario presents three imperfect solutions with trade-offs relating to customer, people, financial, operational, or risk considerations, reflecting the complex decision-making leaders face daily.
What makes this approach distinctive is the integration of senior executive panels who provide real-time feedback and challenge team recommendations. This creates authentic learning moments where participants gain exposure to executive thinking while testing their own strategic reasoning.
Customised leadership simulations for your context
Many simulations focus on leading teams or organisations in an abstract context, such as climbing Mount Everest or managing a fictitious company in an unfamiliar sector.
There’s a logic to this, as the designers don’t want the participants’ organisational knowledge to distract from the focus on solving problems and building new skills (“I know what to do in this situation, we faced it last month!”).
But this is also a valuable missed opportunity to build not just enterprise leadership capability, but also organisational understanding. With that in mind, we work with clients to customise our library of business scenarios to their unique context.
For a retail bank, this included scenarios related to bank closures and customer overcharging. Leaders at a large airline grappled with the trade-offs involved in introducing dynamic pricing. At the same time, a high-potential talent cohort at a leading superannuation provider addressed issues related to sustainable investments and the automation of their member services.
All live business issues for these organisations, as well as significant leadership challenges to contend with.
What participants say about simulations
Recent participant feedback consistently validates the effectiveness of this approach across three critical dimensions:
Strategic learning – “It presented a view to show decisions are not as easy as they seem, and having debrief sessions with leadership provides insights you may not have initially considered.”
Practical relevance – “These scenarios were realistic and relevant to challenges that happen across the industry. It helped me assess my current capability and look at improving skills.”
Network building – “Really fantastic – I’m not a natural networker, but I’ve met and made some great connections. A large group of us are going to lunch next week!”
The strategic opportunity: Moving beyond traditional leadership training
In an era where 50-70% of new leaders struggle within 18 months, the toughest failures often come when leaders are promoted from team-level to functional or enterprise roles. They have not been given a safe space to practice the shift. Leadership simulations offer a different – and demonstrably more effective – approach to building strategic thinking and enterprise leadership capability than many traditional development methods.
The opportunity for many organisations lies in moving beyond conventional approaches that may not be delivering the strategic impact they’re seeking.
Why should organisations invest in leadership simulations?
Because simulations achieve dual outcomes: they build faster, more effective leaders while giving Boards and CEOs confidence that their people have been stress-tested against real business challenges before taking on enterprise responsibility.
How to explore leadership simulations for your organisation
SMG’s leadership simulations are fully customisable to your strategic context, operating environment, and development objectives. Whether delivered in-person or virtually, these experiences can create a lasting impact that translates directly to improved business performance.
As organisations continue to grapple with the increasing complexity and pace of change, there is a growing recognition that leaders need to think systemically, act decisively, and navigate complexity with confidence.
If you’re interested in exploring how leadership simulations might accelerate your organisation’s strategic capability development, we’d welcome the opportunity to discuss your specific needs and context.
