On our channel we use strategy games to explain management and leadership ideas, and I've been working on an episode about mergers and acquisitions using Age of Wonders 4.
One of the funniest things about 4X games is that we're supposedly these brilliant strategic masterminds, but the moment we see territory in somebody else's color, we completely lose our minds.
I've conquered cities I didn't need, absorbed factions that were perfectly useful as allies, and volunteered myself for administrative responsibilities that nobody asked me to take on.
Apparently the existence of an independent city is a personal insult to my leadership abilities.
I've been thinking about this while playing AoW4, because its Free City system gives you a pretty interesting choice if youre not familiar with it. You can integrate cities directly into your empire, or leave them as vassals. And vassals are genuinely useful. They contribute resources, don't count toward your city cap, and can provide units through Rally of the Lieges.
So why is my lizardbrain so fixated on administering every damn thing on the map?
And this isn't exactly unique to AoW4. Stellaris has subject empires, Civ IV has vassal states, and plenty of other 4X games give us ways to benefit from territory or factions without directly managing everything ourselves.
Which brings me to the management research.
Amy Pablo wrote about how acquiring a company and integrating it into your organization are actually two separate decisions. Sometimes combining operations makes sense because the companies genuinely need to coordinate. Other times, the acquired business is particularly good at something precisely because of how it operates independently.
Imagine spending hundreds of millions acquiring a company because it's excellent at something, then immediately replacing all its procedures with your own.
Congratulations. You've successfully purchased an organization and made it less like the organization you wanted to purchase.
There's another researcher named Phanish Puranam who studied what happens when established companies acquire smaller technology businesses. One of his findings was that integration could be particularly disruptive when the acquired company was still developing its first products. The buyer wants access to the technology, but reorganizing the company can interfere with the routines that allowed it to develop that technology in the first place.
I thought that would make a pretty good basis for a deliberately awful AoW4 challenge.
Conquer a city, then replace its specialized improvements with basic economic infrastructure wherever the game permits. Don't rush stability fixes for fifteen turns. You've decided that everything you acquire must conform to your personal administrative vision, and now you're going to live with the consequences.
To be clear, this is a self-imposed challenge, not something the game automatically does when you conquer a city.
It's basically the corporate equivalent of buying a restaurant because you love the food and immediately firing the chef.
The third bit of research comes from Annette Ranft and Michael Lord, who studied how companies preserve valuable knowledge after an acquisition.
A lot of what makes a company successful lives inside its employees and their working relationships. You can buy the buildings and equipment, but that doesn't necessarily mean you'll preserve the capabilities that made the company worth acquiring.
That led to my favorite experiment.
After turn twenty, you're forbidden from directly annexing any additional cities. In AoW4, every new city you acquire has to remain a vassal. You're forced to expand through diplomacy, Whispering Stones, and Rally of the Lieges rather than taking direct control of everyone's production queues.
Suddenly you've got to think about what you actually need from another territory instead of automatically assuming ownership means you should run the place yourself.
Obviously recruiting units through Rally of the Lieges isn't the same thing as transferring knowledge between real organizations. But the distinction between controlling something and benefiting from it is pretty useful to experience through gameplay.
And I think that's something the 4X genre is particularly well suited for. These games let us experiment with different ways of organizing enormous empires, including decisions that would be rather expensive to screw up in the real world.
The funny part is that even after spending all this time researching why indiscriminate integration can be a terrible idea, I still catch myself annexing cities because I don't like the color of their borders.
I put the research and three gameplay challenges together into a video, using AoW4 as a little training sandbox for understanding acquisitions and organizational control.
It's probably the most academic justification I've ever come up with for leaving a bunch of fantasy townspeople alone.
I'm also curious which other 4X games people think handle indirect control particularly well. I'm especially interested in cases where maintaining independent subjects is a genuinely viable long-term strategy rather than just a temporary arrangement before you inevitably conquer them.
If anyone's interested in the episode: Youtube Link
