The key to running a successful business is never losing sight of the big picture.

That’s the lesson Whitefish High School senior Bentley Smith gleaned after running an imaginary company for eight weeks earlier this semester. He and partner Zach Maassen put their heads for business together to run Ramrod, a fictitious company that makes and markets Blu-ray players.

Their efforts were good enough for second place in the High School Business Challenge sponsored by the Montana Chamber of Commerce. Fellow Whitefish High seniors Cole Havens and Ryan Rouse came in third with their company, Peruvian Panda.

About 50 schools across Montana entered teams in the challenge — more than 400 students overall. The top teams received scholarships from the Montana Chamber and will be recognized at Business Days at the Capitol Thursday and Friday.

Havens and Rouse each received $250 scholarships. Smith and Maassen won $500 apiece. First place and a pair of $1,000 scholarships went to a duo from Melstone High School northeast of Billings.

It was a disappointing loss for Smith and Maassen, who had led the state consistently throughout the competition. They ultimately lost because of their cautious approach to the market, Smith said.

“We tried to play it safe at the end,” he said.

In the contest, student partners played the roles of chief financial officer and chief executive officer of their imaginary business. Together they decided how many Blu-ray players to produce, what to spend on advertising, how much to spend on product development, and how much to pay in dividends.

Throughout the competition, teams faced trials that forced them to make tough decisions. In the final “quarter” — one week represented three months in the competition — Ramrod dealt with defective products.

“We had a choice of recalling all our products or sending out advertisements that we would refund them free of charge,” Smith said.

He and Maassen decided to offer customers the chance to contact the company if their Blu-ray players were defective.

It seemed a less expensive option than recalling everything, but Ramrod’s imaginary shareholders weren’t thrilled with the decision.

The company’s stock value still increased that quarter, from $91 a share to $98.75 a share. The Melstone team ended up at $113.95 a share.

Peruvian Panda stock climbed to $96.09 a share by the end of the competition. Havens said he and Rouse had a successful dividend payment strategy, in which they paid stockholders little in the beginning and gradually increased payments each quarter, until the payments were maxed out at the end.

“That’s actually what helped us,” Havens said.

Learning to make money was only part of the competition, said Jeremy Anderson, the marketing teacher whose students at Whitefish High competed in the business challenge. Students also were faced with ethical dilemmas that could make or break their companies.

Their goal, Anderson said, was to make decisions that encouraged the highest stock price and a high moral compass.

“Trying to balance that is real interesting,” he said. “One group was doing very, very well, and they chose not to do health care [for their employees].

“They lost 25 percent of their workers and production fell off. Their stock went from $60 [a share] to $15.”

Most of the ethical decisions involved things that would directly impact employees’ lives, including health care, retirement fund contributions, drug searches and Internet time, Smith said. Students had to decide whether a money-saving option might cost more in the long run.

“The trick is just to make your employees happy,” he said. “We bought all the health insurance we could.”

It was a good real-world experience, Havens said.

“We learned more of what the real world’s going to be like, the kind of stuff it seems like you’ll have to know what to do,” he said, adding that how to manage money was one of the biggest lessons he learned from the challenge.

As for the secret to business success, Havens and Smith both said success depended in part on factors beyond their control.

“You kind of have to have a feel for it, I guess,” Smith said.

“Guess and get lucky half the time, and know what you’re doing half the time,” Havens advised.

Havens attributed a lot of his team’s success to luck. Some teams in the state had competed in the business challenge once or twice before and knew what to expect. This was Havens’ first time competing.

It was Smith’s second competition; last year his team finished fifth in the state. The two years have taught him that businessmen can’t lose sight of the big picture.

“Even when you make little decisions, you think about what’s helping the company, not necessarily that situation,” he said.

Reporter Kristi Albertson may be reached at 758-4438 or by e-mail at kalbertson@dailyinterlake.com