KGame is an online game development company that was set up in Shanghai in 2008. The company mainly recruits young employees because of their familiarity with gaming. One of its key management practices resembles an older type of game—a card game. At the beginning of each month, every employee receives seven theme cards, each of which is marked with an attribute, for example, “super-competent”, “super humorous”, “super hard-working”, or “super supportive”. The employees then give the cards to the colleagues they feel are most deserving of acknowledgment. All the cards have to be given out. At the end of the month, as a kind of performance appraisal, KGame counts how many cards each employee has and rewards are handed out publicly, based on these scores. Sometimes surprise gifts are also distributed, which employees seem to find particularly exciting. As one member of staff puts it, “We’re not only developing games, but also working in a game, which makes us believe in the concept of games all the more.” Boosting employee creativity is at the top of its executive's agenda, and to facilitate creative culture building, KGame locates all of its 400 employees (known as “members”) in one open-plan room, with no separation between managers and other staff. Junior employees are free to walk around and chat with colleagues of all levels. Surrounding this huge main office is a massage room, gym, ping-pong room, and a play area, alongside discussion rooms and many other facilities. The design of the work—and play— environment ensures that people have ample resources to stimulate them mentally, and many opportunities for communicating with—and getting to know—each other in various situations and contexts. The senior management team encourages openness and attaches a high degree of importance to equality. For ex-ample, in response to the call that went out on Twitter, KGames’ CEO took the “Ice Bucket Challenge” in the of-fice, together with five other members. This sent out the message across the organization that the CEO supported raising funds for ALS (Amyotrophic Lateral Sclerosis) and that he was willing to do the Challenge in front of his entire team. This philanthropic gesture significantly enhanced his image. “He’s not old-fashioned, but full of passion, the same as me,” commented one young member. “When he took the challenge, I really got the impression that he meant it, and I found that personally inspirational. He’s a doer, not a talker. I believe in him, and in the organization.” “I hope our members see themselves as the owners of KGame rather than an agent or an employee who’s only working here for the money,” says the CEO. “They’re not just working for KGame: they’re also working for their own aspirations.” KGame sets clear core values of beauty, art, innovation, and player satisfaction in its online games. These values influence the company’s recruitment criteria as well as its general organizational practices. The CEO again: “We’re confident that every KGame member believes in our games and shares our values. For example, we want them to regard a beautiful game figure as a unique contribution to beauty and art. There’s no standard operation process for creating beauty; you can only achieve it by exploring and testing. So, we give our members a lot of room to try out their ideas, with all the resources they need but without having to worry about concepts like ‘failure’ or ‘punishment.’ So far, our member turnover rate has been very low, and we’ve always found it easy to attract talented young people.” Initially, KGame’s management style attracted criticism: traditionalists doubted its validity, believing that employees’ industry experience should be as important as their creative values. But the organization’s stunning success has silenced those critics. In the first six months of 2015, one particular KGame made around $60 million in revenue, achieving a top-three ranking in the Chinese online gaming market. Confident and ambitious, KGame has expanded beyond Shanghai and opened offices in Nanjing, Taipei, and Singapore to explore international markets. Anchored to its core values and organizational culture, the company plans to develop more online games completely internally by integrating new technologies such as big data, IP management engineering, and VR techs. The company’s success is reflected in the capital market, with over 50 million registered users and over 2 million active daily users. It successfully launched in the Shenzhen Stock Exchange in China as a publicly listed company and was the top game stock in the Chinese stock market. Over the past three years, its stock price has increased steadily, from an average of 84.6 RMB/share to 98.4 RMB/share and finally to 114 RMB/share. Recent investment reports rank KGame among their highest recommendations. This case is based on an actual organization, but names and some characteristics have been changed to maintain anonymity. Discussion Questions

1. Why do you think the appraisal game (the one that involves the values card distribution) works so well at KGame?

2. Why do investment institutes recommend KGame?

Answer rating: 100% (QA)

Answer Explanation 1 The appraisal game of KGame has allowed employees to share thei... View the full answer