Incentive alignment at the manufacturing–marketing interface: Design and validation of a management game

Supply chain coordination problems are frequently found at the manufacturing–marketing interface. Inspired by a case study from the food industry, we designed and validated a management game that focuses on potential conflicts between sales order acceptance and manufacturing utilization. We discuss how individual behavior under distributed decision making can be improved to comply with overall company objectives if system awareness is increased, incentive systems are carefully aligned, and cross-functional communication protocols are improved. An empirical investigation in a controlled laboratory experiment with university students shows the game’s effectiveness to achieve the key learning objectives. The results show that both an aligned bonus scheme and information and communication increase overall performance and decrease frictions between the two functional areas. As a further result from the experiment, we find that an improved bonus scheme has a larger impact than improved communication and information.