Gamification—applying digital game design techniques to real-world problems—may still be a new concept for many businesspeople, but it’s rapidly taking hold in a surprising range of contexts.

Video games are a big business, generating roughly $70 billion in annual revenues worldwide. The Pew Research Center found that 97 percent of Americans between ages 12 and 17 play video games, and, it’s not just them; according to the Entertainment Software Association, the average gamer is 30 years old.

In video games’ 40-year history, game designers have developed a raft of insights about how to motivate people. It’s those approaches that propelled a simple-looking slingshot game like Angry Birds to over 1 billion downloads and that enticed users to spend greater than $1 billion in real money buying virtual goods on Zynga’s Farmville.

What if we could capture the techniques those game designers used to motivate people in other contexts? That’s the promise of gamification. It’s what led global consulting firm Deloitte to embed game missions, badges and leaderboards into its training program, Deloitte Leadership Academy, increasing participation by 37 percent. It’s what made Microsoft turn Windows localization testing into a team competition among its offices, motivating employees to review half a million dialogue boxes and identify more than 6,000 problems, all as volunteers. And it’s what caused the Office of Science and Technology Policy at the White House to organize game-based efforts to address R&D, public health, energy use and other major public challenges.

FTW_Cover_borderLast year, I began teaching courses on gamification at Wharton. I also co-wrote a book, For the Win: How Game Thinking Can Revolutionize Your Business, published recently by Wharton Digital Press. When people ask me why such as bleeding-edge subject belongs in the Wharton curriculum, I tell them it’s our job to train the business leaders of tomorrow. Many of the early examples of gamification focused narrowly on basic marketing goals such as motivating customers to spend more time on a website. Today, gamification is being applied to virtually every area of business: human resources, leadership, operations, innovation and more.

It turns out that gamifying business is actually a very old technique. In his famous self-help bestseller, How to Win Friends and Influence People, Dale Carnegie relates the story of Bethlehem Steel CEO Charles Schwab, who motivated mill workers by scratching a number on the ground that represented the output of each shift. When the next shift arrived, they naturally saw it as a challenge and jumped at the task of beating the number. Simply by introducing feedback and competition, Schwab improved performance.

What companies are doing today with techniques from video games is just a must more sophisticated and scalable application of Schwab’s insight.

I like Dale Carnegie’s story for one other reason. Schwab formed Bethlehem Steel with a partner, a man who wasn’t known for gamification, but left his legacy in another way. His name was Joseph Wharton.