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GlobalTech is a struggling electronics firm that manufactures global positioning system (GPS) devices, and things aren't going well. The VP of marketing can't stand the head of R&D, the CEO and the union are at each others' throats and competitors are eroding market share. The company is facing bankruptcy and must turn things around fast.

That's why GlobalTech has invited a consultant to advise them on potential solutions, which could include restructuring everything from the ground up, including layoffs.

It sounds ominous, but don't worry, it's just a game. GlobalTech isn't a real company, just a computer simulation created by Toronto software firm ExperiencePoint Inc. to teach executives how to make better business decisions. But the fictional problems the company suffers — clueless management, lax financial controls and departmental infighting — are daily realities.

By playing around in the simulation, ExperiencePoint co-founder James Chisholm says executives can learn how to make better decisions in the real world. "With a simulation, you can create this experience in one day, in a risk-free space," says Mr. Chisholm. "That gets people talking about the issues ¡K and increases their capability in a very short time."

ExperiencePoint is one of dozens of companies working in the rapidly growing field of "serious games" that teach skills beyond fragging zombies and saving princesses. And business simulations, used in executive education programs and MBA schools, are increasingly popular as younger, game-savvy workers move up the corporate ranks.

"They're going to corporate training courses and they find someone standing at the front of the classroom with a Powerpoint show when they're used to being engaged in a different way," Mr. Chisholm says.

Games have been used in business school classrooms for decades. Mock negotiations that teach corporate strategy or demonstrating the rules of supply and demand through a market simulation are familiar teaching methods. But by turning those models into video games, experts say, the simulations can become more immersive and more detailed.

"All video games teach you something," says Prof. James Parker, director of the Digital Media Laboratory at the University of Calgary and one of the country's leading researchers in the field of serious games. "The idea behind serious games is to use the same kind of environment to let you become skilled at something that other people find useful and interesting."

Most importantly, video games have one fundamental advantage over real life: a reset button. "There's no consequence to failure," says Mr. Parker. "And in fact you learn a way not to do it in the future."

"I'm a big fan of the simulation," says Tammi Langdon, a human resources consultant with Bell Canada who recently used ExperiencePoint's game as part of a management training session. "Teaching people theory is one thing, but being able to apply that theory in real time drives home that concept really well. It's a great team-building exercise."

Serious games have a wide variety of applications and have been put to use in everything from army recruiting to phobia therapy. But the $11-billion (U.S.) North American corporate training and development market is where the money is. Illinois-based Management Simulations Inc. sells games teaching business fundamentals and strategy to corporate clients and schools; Virginia-based Interpretive Software Inc. is more focused on teaching marketing strategy and management. Toronto's Zapdramatic teaches negotiation skills and dispute resolution.

While many of these companies have been around for 10 years or more, the serious gaming industry is still struggling to define itself. Most of the offerings are graphically simplistic — ExperiencePoint's games have all the visual panache of clipart — and can only teach the most general of business concepts. But that's changing quickly.

"The serious game industry is like the computer industry in the Atari years," says Mr. Chisholm. "There are a variety of players out there who are trying different types of design, and defining genres that are going to stick." While he used to spend most of his time convincing skeptical managers of the efficacy of video-game learning, Mr. Chisholm says the conversation has changed in the last few years. "It's now not about 'why,' it's now 'do you have something in this particular area?' "

That's why ExperiencePoint is working on new software that will allow customers to develop their own business simulations, tailored to their needs. The company already offers a variation on its change management simulation tailored for the health care industry, and he believes increased specialization will make the games more relevant to the specific needs of individual customers, and more appealing to the corporate workers who play them.