Let the games begin.

At many companies, games are serious business.

They're not only fun ways to motivate employees, they're great ways to achieve company financial goals. Companies practicing open-book management often play games built around specific revenues and expenditures. The contests teach employees

"If you base a game on a specific goal, you're making it clear - people know what your aim is and have the opportunity to influence it - you can have a tremendous impact," says James Shaffer, an Arlington, Va.-based principal with Towers Perrin who consults with companies practicing open-book management.

"The key is, the game needs to be closely tied to the overall business goals," he says.

THE CROSS-SELLING GAME

One small company, concerned that staff members knew little about the company's services, devised a team game to encourage cross-selling and an awareness of the big picture.

To tackle its problem, Cornwell Jackson Group - a 20-person Dallas firm providing a wide range of tax, accounting, financial planning, management consulting and information systems services - instituted the "Green-White Game." Principal Gary Jackson designated two teams, each with employees representing all of the company's services.

For three months last spring, teams were awarded points for each referral of clients and contracts to any of the firm's services. Teams earned one point for simply referring someone to another service; two points for a "warm referral," such as transferring telephone callers or introducing them to a co-worker; three points for accompanying a referred client to meet a co-worker; and a bonus points for referrals resulting in additional business from an existing or new client. All referrals were reported to Jackson, who served as score-keeper.

Generating numerous referrals to the firm's financial planners during last spring's tax season, "the Green Team blew away the White Team," says Jackson. The prize: After the April 15 tax deadline, the White Team cooked dinner for the Green Team. The company also promised a paid day off and a trip to a local amusement park if both teams reached a certain point total, but that total was not achieved.

The real reward for everyone was a significant increase in business, perhaps adding as much as $200,000 to the company's approximately $2 million in annual revenue. Fifty-two tax-preparation customers were referred for financial planning services, which often generate long-term revenues.

After three months, the staff brainstormed ways to revise and extend the game. One planned improvement was awarding more bonus points for referrals that resulted in larger amounts of revenue. But because the game was so successful, it won't be played during the company's busy tax season. So many leads were generated that following up on them became a problem.

"Games are a great way to solve what we considered weaknesses," says Jackson. "You get so much more participation, it makes your workplace a lot more fun and everyone gets into it. And that's a benefit that's kind of hard to quantify. You can feel it in the air."

THE POSTAGE COSTS GAME

At Colburn-Bertholon-Rowland - a 165-employee insurance administration and brokerage operation with four offices in three states - postage, telephones and paper are major expenses.

To get everyone thinking about ways to cut those costs, the Media, Pa.-based company focused for one quarter this year on postage costs, a simple line item affected by almost every employee. Starting in July, one large office tracked its monthly postage costs compared with those expenditures for the same months in the previous year. Fifty percent of any savings the office posted were put into an incentive pool, to be paid out at the end of the quarter. The remaining 50 percent was added to the company's bottom line - another incentive since the company's employee stock ownership plan controls two-thirds of corporate stock.

"What we're trying to get people to do is focus on things that they have control of, that they understand and that are an integral part of what they're doing," says Suzanne Kreitzberg, the company's former vice president of HR, now an HR consultant to the company.

In the first two months, almost $4,000 was saved.

The firm has done little formal training for the game, using managers and the company newsletter to disseminate information instead. The newsletter includes tips from departments on how they save on postage costs, and facts about how much it costs to mail various items. Departments can borrow ideas from each other and collaborate on consolidating mailings.

But squeezing postage costs can sometimes swell other costs - faxing a document, for instance, saves a stamp but increases the phone bill. To teach employees how to balance and manage expenses, the company planned to add telephone costs to the game in the following quarter. "So as we start to add more tasks to this whole game, employees are going to understand the correlation of how one expense can impact another and how they're going to have to balance that, individually and as part of a department," says Kreitzberg.

The company may add a third expense category - such as paper - to the game, but juggling "more than three [line items] would be too many balls in the air," she believes.

And because a growing company cannot reliably beat last year's expenses in any given category, the game's "rules" will need to be revised. "The plan is to do whatever we can with these numbers until we can't do any more without frustrating people," Kreitzberg says. "This is working right now as an educational process to get people to look at these line items. If it stops working, we'll move on."

According to Kreitzberg, in open-book companies, "The staff really takes control of the game and somebody comes up with a better mousetrap.... Eventually somebody will say something like, 'This really isn't the best measure of this. How about if we look at [the costs] in terms of percentage of sales?'" instead of absolute dollars.

It is often necessary to reinvent or replace games as they become obsolete or their objectives are met. "Somebody usually takes the lead. And as they learn, the staff is becoming much more sophisticated in devising games," says Kreitzberg.

"The people who are going to play the game should determine what the game is," says Shaffer. He favors a decentralized approach, letting relevant groups of employees devise and play games that make sense and achieve important goals.

THE TIME SHEET ACCURACY GAME

At Mid-States Technical Staffing Services, an Iowa-based provider of temporary staffing, design and engineering services, one small team of workers invented a game to boost the accuracy of time sheets.

Mid-States has 60 employees, 140 contingent workers, and five design centers where engineers and designers do work outsourced by clients. It's important that employee time sheets be accurate, on time and properly coded so clients can be billed correctly.

But in 1995, only 69 percent of time sheets were error free, says John Hentges, a Dubuque design specialist whose duties included collecting time sheets from 24 workers every Monday morning and totaling their billable hours. Inspired by the professional basketball playoffs that spring, Hentges devised the "NBA Time Sheet Championship," exhorting "Need Better Accuracy."

Hentges arbitrarily divided 24 employees into six teams. Workers got 10 points for each error-free sheet. Three points were deducted for late forms, 2 for missing information, and 1 for math errors.

Why a team, instead of an individual, competition? Hentges "wanted people to work as a team to help check each other's time sheets" and to develop some peer pressure to increase accuracy. He distributed team scores weekly, including examples of time sheet mistakes. "I kept employees informed - I felt that was important, because otherwise people would lose interest in the game."

Midway in the 10-week game, time sheet accuracy increased to an average of 75 percent. It often hit 100 percent some weeks near the end of the game. Since then, Hentges says, someone else has assumed responsibility for tallying time sheets, and is amazed at how accurate they are, even when participation grew to 40 employees.

The contest was winner-take-all, with trophies and gift certificates for the winners. "At the end, two teams were very close and it became pretty competitive."

The games companies play are usually team-oriented, even if teams must be arbitrarily created from larger groups of employees. Teamwork increases the peer pressure to achieve the goal, and the mutual help brought to bear on it. "The more you can get people having fun playing the game," the more successful the game will be, notes Shaffer.

RULES OF THE GAME

Games can be devised around any worthwhile goal as a fun means to an end.

Shaffer advises that games contain an appropriate linkage among four elements: the level of effort required, the desired results, the potential rewards, and the extent to which the rewards satisfy those involved.

The rewards need not be money - parties, gifts or a prime parking spot can be appropriate. At Springfield ReManufacturing - the Springfield, Mo., factory that's considered the spiritual birthplace of the open-book management movement - a plant manager promised he and the management team would dance through the plant in dresses if the staff worked 500,000 hours without losing time to an accident. Crew members enjoyed the performance so much they hit 1 million hours to see an encore. They were still counting at 1.3 million hours during Shaffer's last visit.

Games that award money should ideally be "self-funding," generating their rewards from savings or additional revenues created by the game. The proportion of funds shared with employees can vary widely, with a 50-50 split between employees and the company's books considered "pretty healthy," Shaffer says.

Workforces that practice more advanced open-book management may prefer receiving lower percentages of the proceeds from simple games. Earmarking more of the fruits for the bottom line helps strengthen the company's financial position to achieve other longer-term goals. Flowing the money through to the income statement and balance sheet may also improve payouts from broader bonus and compensation plans.

While many simple games are easily designed around expenses, revenue-oriented games are also possible. They can be used to reward employees for landing a big contract or for another significant achievement. Decide beforehand what the reward will be. Maybe a big celebration is in order, or earmarking 5 percent of profits from a new account for an employee reward.

In any type of game, Shaffer recommends "keeping score" very visibly and regularly. Large barometers and scorecards effectively communicate the goal and progress of the game, keeping them prominent in employees' minds. Games - and their underlying goals - heed the principle that "What counts is what you count. . . . When people are counting something, they realize it's important."

Shaffer cited a furniture warehouse that reduced its damage costs 35 percent almost immediately, simply by starting to track costs.

Whatever the game, employees must be given the skills and the authority to influence the numbers, Shaffer says. Teaching and trusting employees to exercise their judgment to pursue specific goals can dramatically change their attitudes.

At Colburn-Bertholon-Rowland, says Kreitzberg, "It's made a tremendous difference - not only in the way people work, but in the way they come to work."

Leon Rubis is editor of HRMagazine.