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What is a wargame?
By Mary MacCarthy
A wargame is a strategic planning exercise addressing a specific competitive challenge where employees roleplay various market scenarios that may develop over a selected time horizon. Adapted from military wargames, business wargames can address gaining market share, purchasing or divesting a business, launching a new technology or product, managing a competitive product launch, mitigating a supply chain weakness and many other situations. The purpose is to get cross-functional employees into the mindset of key stakeholders and competitors to understand and anticipate:
What are each competitor’s advantages and weaknesses?
How will customers’ needs and wants change?
How may competitors react to market shifts?
How may customers react to these shifts?
What opportunities and threats should we anticipate, prioritize and plan to address?
When executed well, a wargame produces concrete, actionable recommendations based upon a better understanding of the market and customers. The process requires rigorous preparation to ensure the intelligence is as complete as possible, relevant, accurate and timely. Teams of unbiased strategic thinkers use this intelligence and selected exercises to develop strategy and compete against each other.
Depending on the industry, common functions represented on the teams include Sales, Marketing, R&D, Technical Service, Finance, Clinical, Regulatory and Executives. In the end, getting the most value from a wargame requires incorporating the new insights and analysis into strategic plans. Employees that participated in the wargame tend to embrace the resulting strategic plans and drive them to implementation.
DEFINING A VALUABLE WARGAME
PURPOSE STATEMENT
By Mary MacCarthy
The most valuable wargames start with defining a simple, specific purpose statement as it drives the wargame design. Think ahead about how the information from the wargame will be used, such as incorporating it into a business plan, term sheet, proposal, or marketing plan. Document questions you want answered from the wargame to help develop and test the purpose statement.
Here are some examples of real client purpose statements and our supporting wargame design:
1)
Company was launching a product with new mechanism of action into a crowded market and looking for ways to counter messaging from existing competitors before their launch. They also wanted projections on how long it would take to capture significant share. We designed the wargame to identify angles to create space in the market and model market share over time.
2)
Company was looking to increase throughput from their R&D unit, which was not keeping pace with competition. We designed the wargame to identify opportunities and weaknesses in their culture, processes and resource alignment.
3)
Company was looking to enter an adjacent market that lacked a major player. We designed the wargame to help them select the best value acquisition.
4)
Company was asked by a major client to submit a bid in an area they had never competed in before and they wanted to assess the opportunity. We designed their game to understand whether they could compete, who they should partner with, and how to price their bid.
6)
Company was taking a lot of heat from the local media for not being able to juggle the interests of their many stakeholders in operating a regional power-generating dam. We designed the game to improve their understanding of these stakeholders’ interests so they could plan and execute better communications.