HANNAH BATES: Welcome to HBR On Technique—case research and conversations with the world’s high enterprise and administration consultants, hand-selected that will help you unlock new methods of doing enterprise.
Should you actually wish to compete in your trade, it’s a must to suppose like your rivals. How may they reply to your subsequent transfer? What occurs in the event that they outmaneuver you? What’s your plan then?
That is known as company wargaming, or aggressive simulating. And in response to Southern Methodist College adjunct professor Arjan Singh, this disciplined method to state of affairs planning helps corporations take a look at how their methods and ways maintain up out there. The train additionally helps them keep away from blind spots. He talked to host Alison Beard on HBR IdeaCast in 2024 about how corporations can get began.
ALISON BEARD: Now, I do wish to be delicate about this time period battle video games as a result of, as we all know, many individuals on this planet from Ukraine to Israel and Palestine are coping with precise battle proper now. However, clarify for us why you utilize it and what precisely it means.
ARJAN SINGH: Conflict video games are basically costume rehearsals for corporations to actually take a look at and stress take a look at their methods earlier than they deploy them into {the marketplace}. Wargaming may be very in style within the navy. It crossed over into the enterprise world about 40, 50 years in the past. The terminology has caught on since then. It is usually known as aggressive simulations.
Many of the purposes of wargaming within the enterprise atmosphere construct on the ideas from the navy so there’s a whole lot of similarities. Clearly, the matters are very, very completely different. It follows a really related construction when it comes to understanding your key aggressive panorama, your atmosphere, who the important thing gamers are, what typical conditions might emerge as you’re entering into the battlefield. So very related within the navy world, and it crosses over into the enterprise world very, very seamlessly.
ALISON BEARD: And the way does it differ from conventional state of affairs planning?
ARJAN SINGH: So conventional state of affairs planning, the notion there’s actually round considering by way of completely different outcomes that will occur in a aggressive atmosphere. You hope for the very best, however you put together for the worst, and you’re employed out methods constructed on these different worlds which might be there.
Wargaming takes situations to a different component. So it’s not nearly what’s potential sooner or later, however then the wargaming provides layers on when it comes to the doubtless actions of key opponents and stakeholders within the market. After which, the actions that an organization ought to absorb response to that, as properly. So, it actually drives house the actionability and transferring it past an mental train to actually pragmatic subsequent steps for organizations to actually deliver them to life.
ALISON BEARD: So, give me an instance of a battle sport train that you just may give your college students.
ARJAN SINGH: So, the one which we’re operating at the moment at SMU is The Battle for Mobility. And so, the entire notion there and the central theme there’s round, “Who’s going to manage mobility sooner or later?” And so, we’ve acquired six completely different groups which might be represented there. We’ve acquired just a few conventional automakers like GM, Volkswagen, Toyota. Now we have next-generation suppliers like Tesla. We’ve acquired Uber, in addition to Waymo, represented there. And, the entire notion there’s round, “Who’s going to win on this battle, the battle for mobility? What is going to mobility appear like sooner or later? And what if the world evolves to a scenario the place there’s nonownership of vehicles, applied sciences, AI? How would that have an effect on how individuals commute and use transportation sooner or later?”
ALISON BEARD: So, that concept of “the battle for” is perhaps how corporations or groups needs to be occupied with it, the battle for this explicit market or this group of customers?
ARJAN SINGH: Yeah. Precisely. It’s actually across the battles. But in addition, round defining what that battle is and the way do you outline your trade and the battle place and who you’re competing in opposition to?
So, I’ll provide you with an instance. Once we went into the COVID scenario, everybody was at house and acquired accustomed to on-line collaboration toolkits. And after we acquired again into the submit pandemic world, enterprise journey got here again with an enormous drive. And so while you take a look at conventional opponents, you can see the airways are competing with different airways and different transportation suppliers.
However then on this new actuality, there have been a whole lot of different competitors. So it was American Airways, Zoom, Microsoft Groups, the digital world versus the precise necessity to have the ability to go journey. And so, definition is actually, actually essential when it comes to what that aggressive set seems to be like. Corporations that outline it too narrowly can find yourself in conditions the place they could be blindsided by new opponents coming in. And so, that definition’s actually, actually essential when it comes to what that battle might be.
ALISON BEARD: What are the key varieties of video games or situations that you just educate your college students and you utilize with shoppers?
ARJAN SINGH: So while you take a look at wargaming, it actually matches into three completely different ranges. There’s strategic battle video games, which is actually anchored round long-term technique, how core macroeconomic developments are altering the aggressive atmosphere. And so they’re basically answering the query, “What is going to the sport be sooner or later?” That tends to be far more senior degree executives that may get entangled in strategic video games.
The subsequent degree down is operational video games. And while you’ve acquired an outlined area, you’ve acquired outlined opponents. And it’s actually considering by way of the place to play, “What areas does an organization have to be competing in?”
And you then get down into the executional sort of video games, that are the tactical video games. So, these are typically a lot shorter time period. This tends to be centered in on promoting and often has a one to 2 yr time horizon. The core query there’s actually round, “ win, how will we promote extra product within the market, how will we message in opposition to our competitors, and the way will we finally find yourself profitable in that area?”
ALISON BEARD: Yeah. After which, how do you give you the precise situations?
ARJAN SINGH: So, situations is an space which… It’s been very properly documented and written about within the enterprise world. There’s alternative ways of situations. Eventualities will be quite simple. So, it might be so simple as having the group that’s in a battle sport brainstorm a set of key issues that will have an effect on the atmosphere. After which, voting on it and prioritizing which of them they want to deal with. At its simplest kind, it’s a really fast train. It may take a couple of minutes.
The factors for situations is actually round impactful conditions. So, issues that can affect a competitor atmosphere and actually considering of it from an affect perspective, not probability, since you actually wish to play out the situations that would be the most impactful.
ALISON BEARD: So while you’re promoting this proposition of wargaming to your college students and to shoppers, what particular alternatives do you level to that this may yield versus different varieties of strategic planning? After which, what particular issues or dangers do you see it serving to corporations overcome?
ARJAN SINGH: Yeah. The chance a part of wargaming is actually round serving to corporations keep away from blind spots. This tends to occur so much with incumbent gamers which have massive market shares. The perspective tends to be, “That is how the trade is. We’re skilled on this area and we all know it properly, therefore our success. And, we count on this to proceed.” There’s a whole lot of enterprise faculty examples and case research of how that’s led to the downfall of a whole lot of corporations, together with a whole lot of iconic names which might be there. So, it helps-
ALISON BEARD: Kodak, Blockbuster, all of these.
ARJAN SINGH: Precisely. And so, it is a discussion board for having these conversations. And, it’s notably essential when the conversations are going to be uncomfortable. It’s going to problem the established order. It’s going to make a corporation suppose otherwise.
And that’s one of many actual advantages which might be there as a result of in a battle sport, you’ve completely different corporations which might be represented. You break up the group into these completely different teams and inform them, “Assume by way of it like that firm. Take into consideration, ‘What does profitable imply for this group, and the way are you going to assault our group? And, what are you considering?’”
You begin getting actually deep into that thought course of, and it generates a whole lot of insights. Doing this evaluation inside out, actually entering into the heads of the competitors and searching on the market from their vantage level, is immensely priceless.
ALISON BEARD: Why do you suppose that a whole lot of organizations wrestle to interact in that form of in-depth occupied with completely different potential futures and the place their assumptions is likely to be incorrect?
ARJAN SINGH: Lots of instances, it’s only a operate of sources and time. You realize? As a result of companies are busy. They’re busy when it comes to executing. There’s all the time issues to do. And, a whole lot of instances I get pushback when corporations speak about doing battle video games they usually say, “Oh, can we do that in two hours?” And the reply is, “Effectively, you can, but it surely’s in all probability not going to be superb. To do a well-thought-out sport, you want between a everyday and a half.
And so, then there’s logistics round getting individuals collectively, particularly in case you’re doing a strategic sport and there’s senior administration concerned. Their calendars are very guarded and laborious to get onto, not to mention asking for eight to 12 hours of their time for this. So, time and sources tends to be a part of it. And, the opposite half is cultural. Some organizations should not snug having their assumptions challenged. There’s a whole lot of construction hierarchy that comes into play. And in case you’re questioning a few of the senior individuals and their considering, it’s not taken the appropriate method. So, culturally it may be a problem, as properly.
ALISON BEARD: What info do individuals want or ought to they be given earlier than they begin?
ARJAN SINGH: So usually for a sport, you need to have a briefing doc that’s acquired sufficient background for everybody to be educated in an space. And one of many key distinctions is, for corporations which might be in a selected space they usually’re doing a sport with that area that they know rather well, so your pre-briefing paperwork tends to be so much lighter as a result of it’s an space that persons are accustomed to.
For areas that corporations want to get into or construct data in a short time, video games even have an effective way of doing that very, in a short time. And in these situations, the briefing paperwork can be much more complete.
Usually talking, the briefings are primarily based on market info, aggressive intelligence that you just may need. After which, actually deep diving into the businesses and never solely the cores of apparent metrics, however actually delving deeper into earlier battles, what they’ve executed in earlier situations, different classes from historical past that may be utilized right here.
ALISON BEARD: And so, then what occurs within the precise sport?
ARJAN SINGH: So, the sport is a collection of plenary classes adopted by breakout rooms, the place the groups work collectively. So in a typical sport, you’d begin with an introduction. You’ll give perspective when it comes to the subject, the core subject that you just’re making an attempt to resolve, what actions you’re anticipating to return out of it. You could current a bit of a part of the briefing doc so that everybody is on the identical degree of data.
After which, you undergo a collection of workout routines. And, the primary spherical you’ll usually say, “Okay. For the corporate that you just symbolize, construct a method to win within the market and suppose by way of varied levers that you just’re going to make use of. But in addition, actually take into consideration, ‘What does profitable imply for you? Shat does profitable imply on your group?’”
As a result of in a market, though you might have direct opponents, every firm often has a special definition of profitable. And so, it’s actually to know what that thought course of is, profitable, after which the course of these strategic themes that they’re going to return after.
You may also put in particular asks round, “How would you assault your group? How do you view the group, and what are the precise issues that you just’re going to do to remove market share or gross sales or different metrics that you just is likely to be ?” After which from that time onwards, the groups will put together their displays, they’ll come again, they’ll current. There’ll be panel of judges, doubtlessly, that can give suggestions. And the groups will usually return, they’ll revise their methods primarily based on suggestions, primarily based on how the competitors’s going to be attacking that. After which, you begin going by way of a collection of workout routines that delve deeper and deeper and deeper into that entire matter space.
After which the video games, usually, they conclude on the finish with turning it round from the corporate’s perspective. And the core query there’s, “Primarily based on these rounds of wargaming and battles that you just’ve gone by way of, what are the important thing insights that you just’ve generated? The place do you suppose are the most important alternatives to what you are promoting? The place are the most important dangers which might be there? The plan that you’ve proper now, are you ready for a few of these conditions?”
After which finally, it’s actually round driving actions. And, you prioritize: “What are the core issues that have to be executed proper now, proactively? What are the issues we now have to attend till they begin enjoying out within the market?” And a profitable sport really has names of departments or people subsequent to every of these motion objects who’re accountable and accountable for transferring that ahead.
ALISON BEARD: Yeah. That’s helpful. I believe we’ve all had the expertise of going to an off-site and brainstorming nice concepts, after which simply form of nothing occurs after. You talked concerning the battle for mobility that you just did along with your college students. Are you able to give us an instance of a battle sport that you just’ve executed with a consumer just lately?
ARJAN SINGH: So, wargaming tends to be a quite common exercise within the pharmaceutical biotech area. I don’t suppose I do know of 1 massive pharma biotech that has not executed a battle sport. So, all of them do it. And, a part of the rationale there’s you’re spending over a billion {dollars} to deliver a drug to market. There’s important pores and skin within the sport. And so usually, within the pharmaceutical trade, there tends to be a whole lot of wargaming as belongings are delivered to market, finish of Section 3, finish of Section 3, Decide to File, after which as soon as they begin launching into {the marketplace}.
And so, one current sport I’ve executed within the pharmaceutical area. And it was a possible blockbuster they’re bringing to market so their expectations are over $5 billion in income for the product. And so, the sport adopted the same construction to what I outlined. We acquired into particulars. And after we began entering into situations, one of many situations that got here up within the dialogue was round, “What if the FDA doesn’t approve the product?”
And in order you may think about, there was a whole lot of opinions within the room round, “Effectively, that will by no means occur. We all know what we’re doing.” Lots of defensiveness, as properly. And we mentioned, “Look, that is what it’s a must to do, is to actually put together for the worst and hope for the very best.”
And so, they went by way of the state of affairs they usually checked out, “If the FDA doesn’t approve the product, what’s going to they do?” They got here up with a playbook on what to do there. Conflict sport was accomplished. And about lower than a yr later when their approval date got here up from the FDA, the product was not authorized.
And so as an alternative of panicking, as an alternative of claiming, “Oh, now what will we do?” They went and regarded on the output from the battle sport and mentioned, “Look, we now have a playbook right here. We all know precisely what we have to do. There’s sure alerts within the information that we now have to reanalyze.” There’s these different issues that they needed to do. They form of executed on that and resubmitted it with the FDA. The product was authorized afterwards as they’d gone there.
ALISON BEARD: So it looks like a part of the objective is to determine the way you may fail earlier than you really do, or the way you’re going to take care of a loopy shock like COVID.
ARJAN SINGH: Precisely. The way you may fail earlier than you really do. The COVID shock was really an fascinating one. We’d executed, with the scholars in 2017, The Battle for the Traveler, which was a sport by which we had a few airways, American, Delta, we had the OTAs, Expedia, reserving.com. We had TripAdvisor, Marriott, which is a conventional lodge chain. The entire notion is everybody’s making an attempt to manage the traveler and everybody’s saying, “Hey, ebook on our web site. You don’t should go elsewhere.” Airways now are saying, “We’ll provide you with loyalty factors for not simply flying, we’ll provide you with loyalty for bank card expenditure and eating and different components, as properly.”
And in that sport, apparently in 2017, we really had the COVID state of affairs, which was the scholars had gone by way of constructing base case methods for the businesses they symbolize, how they’re going to win. And, one of many issues that got here out after spherical one was each single firm that was within the room had one specific assumption that their methods have been primarily based on, which was, “The journey growth in the US is more likely to proceed. And, that’s what we’ve constructed our methods on.”
And so the state of affairs we gave them, we made it very generic simply saying that, “Occasions occurred on this planet the place it’s going to have an impact of declining demand for journey by as much as 95%.” We put a remark in there from a fictional analyst saying that, “The journey growth in the US, the best way that we’ve recognized it, is lifeless. Leisure journey’s lifeless, and enterprise journey goes to take about three years to recuperate.” So, that was basically the COVID scenario.
And the scholars’ reactions first was, “Oh, no method. That is by no means going to occur. It’s foolish situations.” And we mentioned, “No. Undergo it.” And, each single firm needed to rework their technique and their playbook primarily based on that one assumption altering, that the market growth’s over. It’s going to be over for the following three years or so.
ALISON BEARD: So, it looks like the output from these classes is a playbook for quite a lot of situations that then you may put into motion and ensure is carried out if these situations come up?
ARJAN SINGH: That’s, and that’s actually the important thing to driving actionability after a battle sport. As you’d talked about, all of us have been to these conferences, which I name fascinating, nice discussions, a whole lot of nice thought course of that’s there. However then, it doesn’t actually result in something. Proper? And actionability, actually, from a battle sport comes from the playbook. And, the playbook’s usually structured round, “What actions ought to a corporation take? What these subsequent steps are. What are the actions to take versus a few of the situations?”
So if state of affairs occurs, construct a playbook in response to that. Perceive the important thing insights that you just’ve generated in your competitors, what their sizzling matters is likely to be, what are the areas the place they’re weak, the place you can actually focus in on? And having all these particulars in a quite simple format, to make use of transferring ahead.
Then, the opposite profit to a playbook is that that is the output of the stakeholders within the group. So, this isn’t a 3rd occasion telling them what to do or one particular person, it’s everybody aligning as a bunch when it comes to, “We perceive the core points. We perceive the place our alternatives are. We align on what our subsequent steps are going to be.” It’s a a lot faster technique to mobilize a corporation in the direction of a selected objective or actions.
ALISON BEARD: Yeah. I like the purpose you made within the ebook about how consultants may are available in and say, “Proper. That is what you need to do.” After which, they’re not ever liable for the end result of what they’ve really useful. There’s an enormous distinction. And so, how usually ought to organizations repeat this course of?
ARJAN SINGH: Lots of organizations do wargaming on an annual foundation. So, a few of the finest at school corporations have built-in battle gaming into their planning course of, so their annual planning course of. They’ll kick that off with a battle sport, take a look at completely different features of their aggressive atmosphere, after which they get into their planning.
So, that’s form of finest observe. Relying on trade, it’ll fluctuate. So in case you’re strategic points and also you’re in a conventional trade, you in all probability have to do one as soon as each couple of years or so. Should you’re in a fast paced space like know-how or others, you can do it yearly, you can do it a number of instances a yr. After which, it additionally will depend on the subject space, as properly. So for instance, in case you’re bidding on a big contract that’s value billions of {dollars} and also you’ve acquired a 18-month to 24-month gross sales cycle, I do know of corporations in these conditions, they battle sport each week.
ALISON BEARD: Hmm. Wow.
ARJAN SINGH: Yeah. I imply, for a few of the massive ones, just like the Jedi contract, I do know there are some corporations that did weekly ones. When there’s $10 billion on the desk, you attempt to work out not solely what you’re considering, however all the important thing stakeholders, and what that battle may appear like and all of the permutations and mixtures there, for which you’d want important quantities of rounds of state of affairs planning and wargaming.
ALISON BEARD: Yeah. So, it sounds such as you’re saying that particular groups inside organizations also can use this course of to consider their aggressive technique on a smaller scale, like signing an enormous deal.
ARJAN SINGH: Completely. You realize the gross sales workforce can discover a whole lot of profit from with the ability to promote extra product, meet their objectives. It may assist from a advertising and marketing perspective. There’ve been others, analysis and improvement, finance, technique. Lots of completely different purposeful areas can profit from this, however their matters might be completely different. Advertising and marketing can be eager about very various things from say, R&D and others. And so, it positively has an area for various areas inside a corporation, in addition to for start-ups.
This isn’t only a toolkit for giant organizations. The bigger organizations do spend a whole lot of effort and time on it. It is a quite simple toolkit that start-ups can use when it comes to in case you’re bootstrapped, you’re bringing a product to market, simply position play and see how the competitors’s going to react. It can save you a whole lot of expensive errors by doing that internally earlier than you begin deploying your methods externally.
ALISON BEARD: Have you ever ever had an occasion the place a battle sport led an organization within the incorrect route as a result of they didn’t come to the appropriate conclusions?
ARJAN SINGH: There’s been just a few. Mistaken route when it comes to optimizing belongings and prioritizing their developmental plans, it’s occurred a few instances. And, one of many primary causes for that was round not likely having the appropriate background info on the realm. It was an rising space, and they also needed to make sure assumptions on what was more likely to occur.
The massive subject there was the best way that they considered it was from their firm’s lens, not the competitors’s lens. That was a mistake that occurred, the place they ended up getting into a special route. However with monitoring and persevering with to look and having early warning alerts that you just take a look at, you may course appropriate very, in a short time. And so in that occasion, there are particular assumptions and hypotheses that that they had in an motion plan getting out of the workshop. They began deploying it. After which in a short time, primarily based on suggestions, what they found was that they have been considering by way of it the incorrect method, after which they course corrected pretty rapidly.
ALISON BEARD: So, you probably did speak about pushback and the truth that, particularly in rising markets, it’s laborious to foretell what’s going to occur. For these individuals who say to you, “All the pieces is altering so rapidly. I have already got a lot on my plate. I believe we will develop an excellent technique with out going by way of this course of,” what do you say?
ARJAN SINGH: That’s an important query. That occurs a whole lot of instances. The time dedication and taking 15, 20, 30 individuals from work and having them in a day or two to workshop, that’s all the time a problem. And, generally it’s faster to beat it by way of simply displaying earlier examples or worth. Generally it takes time.
I had an organization that had that very same pushback. And so they didn’t do a sport for, I believe it was virtually three years. After which lastly, they have been able to do it. As soon as they accomplished it, the primary response was, “Why didn’t we do that earlier? This is able to’ve saved us a whole lot of time, effort, heartache, and sources.”
Generally corporations simply should form of undergo that entire course of to get that realization as a result of finally it’s round blind spots and dear errors and alternatives that they may have recognized earlier. Lots of instances the catalyst for breaking that’s if somebody within the workforce’s really been by way of a sport. They’re the champions of speaking by way of wargaming and the advantages which might be there. That’s a course of to undergo. That’s one of many causes I wrote the ebook, was to only educate everybody when it comes to the advantages of doing this and having efficient, actionable video games of their organizations.
ALISON BEARD: Arjan, thanks a lot for speaking to me right this moment.
ARJAN SINGH: Nice. Thanks.
HANNAH BATES: That was Southern Methodist College adjunct professor Arjan Singh, in dialog with Alison Beard on HBR IdeaCast. Singh is the creator of the ebook Aggressive Success: Constructing Successful Methods with Company Conflict Video games.
We’ll be again subsequent Wednesday with one other hand-picked dialog about enterprise technique from the Harvard Enterprise Evaluation. Should you discovered this episode useful, share it with your mates and colleagues, and comply with our present on Apple Podcasts, Spotify, or wherever you get your podcasts. When you’re there, you’ll want to go away us a evaluate.
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This episode was produced by Mary Dooe and me, Hannah Bates. Curt Nickisch is our editor. Particular due to Ian Fox, Maureen Hoch, Erica Truxler, Ramsey Khabbaz, Nicole Smith, Anne Bartholomew, and also you – our listener. See you subsequent week.
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HANNAH BATES: Welcome to HBR On Technique—case research and conversations with the world’s high enterprise and administration consultants, hand-selected that will help you unlock new methods of doing enterprise.
Should you actually wish to compete in your trade, it’s a must to suppose like your rivals. How may they reply to your subsequent transfer? What occurs in the event that they outmaneuver you? What’s your plan then?
That is known as company wargaming, or aggressive simulating. And in response to Southern Methodist College adjunct professor Arjan Singh, this disciplined method to state of affairs planning helps corporations take a look at how their methods and ways maintain up out there. The train additionally helps them keep away from blind spots. He talked to host Alison Beard on HBR IdeaCast in 2024 about how corporations can get began.
ALISON BEARD: Now, I do wish to be delicate about this time period battle video games as a result of, as we all know, many individuals on this planet from Ukraine to Israel and Palestine are coping with precise battle proper now. However, clarify for us why you utilize it and what precisely it means.
ARJAN SINGH: Conflict video games are basically costume rehearsals for corporations to actually take a look at and stress take a look at their methods earlier than they deploy them into {the marketplace}. Wargaming may be very in style within the navy. It crossed over into the enterprise world about 40, 50 years in the past. The terminology has caught on since then. It is usually known as aggressive simulations.
Many of the purposes of wargaming within the enterprise atmosphere construct on the ideas from the navy so there’s a whole lot of similarities. Clearly, the matters are very, very completely different. It follows a really related construction when it comes to understanding your key aggressive panorama, your atmosphere, who the important thing gamers are, what typical conditions might emerge as you’re entering into the battlefield. So very related within the navy world, and it crosses over into the enterprise world very, very seamlessly.
ALISON BEARD: And the way does it differ from conventional state of affairs planning?
ARJAN SINGH: So conventional state of affairs planning, the notion there’s actually round considering by way of completely different outcomes that will occur in a aggressive atmosphere. You hope for the very best, however you put together for the worst, and you’re employed out methods constructed on these different worlds which might be there.
Wargaming takes situations to a different component. So it’s not nearly what’s potential sooner or later, however then the wargaming provides layers on when it comes to the doubtless actions of key opponents and stakeholders within the market. After which, the actions that an organization ought to absorb response to that, as properly. So, it actually drives house the actionability and transferring it past an mental train to actually pragmatic subsequent steps for organizations to actually deliver them to life.
ALISON BEARD: So, give me an instance of a battle sport train that you just may give your college students.
ARJAN SINGH: So, the one which we’re operating at the moment at SMU is The Battle for Mobility. And so, the entire notion there and the central theme there’s round, “Who’s going to manage mobility sooner or later?” And so, we’ve acquired six completely different groups which might be represented there. We’ve acquired just a few conventional automakers like GM, Volkswagen, Toyota. Now we have next-generation suppliers like Tesla. We’ve acquired Uber, in addition to Waymo, represented there. And, the entire notion there’s round, “Who’s going to win on this battle, the battle for mobility? What is going to mobility appear like sooner or later? And what if the world evolves to a scenario the place there’s nonownership of vehicles, applied sciences, AI? How would that have an effect on how individuals commute and use transportation sooner or later?”
ALISON BEARD: So, that concept of “the battle for” is perhaps how corporations or groups needs to be occupied with it, the battle for this explicit market or this group of customers?
ARJAN SINGH: Yeah. Precisely. It’s actually across the battles. But in addition, round defining what that battle is and the way do you outline your trade and the battle place and who you’re competing in opposition to?
So, I’ll provide you with an instance. Once we went into the COVID scenario, everybody was at house and acquired accustomed to on-line collaboration toolkits. And after we acquired again into the submit pandemic world, enterprise journey got here again with an enormous drive. And so while you take a look at conventional opponents, you can see the airways are competing with different airways and different transportation suppliers.
However then on this new actuality, there have been a whole lot of different competitors. So it was American Airways, Zoom, Microsoft Groups, the digital world versus the precise necessity to have the ability to go journey. And so, definition is actually, actually essential when it comes to what that aggressive set seems to be like. Corporations that outline it too narrowly can find yourself in conditions the place they could be blindsided by new opponents coming in. And so, that definition’s actually, actually essential when it comes to what that battle might be.
ALISON BEARD: What are the key varieties of video games or situations that you just educate your college students and you utilize with shoppers?
ARJAN SINGH: So while you take a look at wargaming, it actually matches into three completely different ranges. There’s strategic battle video games, which is actually anchored round long-term technique, how core macroeconomic developments are altering the aggressive atmosphere. And so they’re basically answering the query, “What is going to the sport be sooner or later?” That tends to be far more senior degree executives that may get entangled in strategic video games.
The subsequent degree down is operational video games. And while you’ve acquired an outlined area, you’ve acquired outlined opponents. And it’s actually considering by way of the place to play, “What areas does an organization have to be competing in?”
And you then get down into the executional sort of video games, that are the tactical video games. So, these are typically a lot shorter time period. This tends to be centered in on promoting and often has a one to 2 yr time horizon. The core query there’s actually round, “ win, how will we promote extra product within the market, how will we message in opposition to our competitors, and the way will we finally find yourself profitable in that area?”
ALISON BEARD: Yeah. After which, how do you give you the precise situations?
ARJAN SINGH: So, situations is an space which… It’s been very properly documented and written about within the enterprise world. There’s alternative ways of situations. Eventualities will be quite simple. So, it might be so simple as having the group that’s in a battle sport brainstorm a set of key issues that will have an effect on the atmosphere. After which, voting on it and prioritizing which of them they want to deal with. At its simplest kind, it’s a really fast train. It may take a couple of minutes.
The factors for situations is actually round impactful conditions. So, issues that can affect a competitor atmosphere and actually considering of it from an affect perspective, not probability, since you actually wish to play out the situations that would be the most impactful.
ALISON BEARD: So while you’re promoting this proposition of wargaming to your college students and to shoppers, what particular alternatives do you level to that this may yield versus different varieties of strategic planning? After which, what particular issues or dangers do you see it serving to corporations overcome?
ARJAN SINGH: Yeah. The chance a part of wargaming is actually round serving to corporations keep away from blind spots. This tends to occur so much with incumbent gamers which have massive market shares. The perspective tends to be, “That is how the trade is. We’re skilled on this area and we all know it properly, therefore our success. And, we count on this to proceed.” There’s a whole lot of enterprise faculty examples and case research of how that’s led to the downfall of a whole lot of corporations, together with a whole lot of iconic names which might be there. So, it helps-
ALISON BEARD: Kodak, Blockbuster, all of these.
ARJAN SINGH: Precisely. And so, it is a discussion board for having these conversations. And, it’s notably essential when the conversations are going to be uncomfortable. It’s going to problem the established order. It’s going to make a corporation suppose otherwise.
And that’s one of many actual advantages which might be there as a result of in a battle sport, you’ve completely different corporations which might be represented. You break up the group into these completely different teams and inform them, “Assume by way of it like that firm. Take into consideration, ‘What does profitable imply for this group, and the way are you going to assault our group? And, what are you considering?’”
You begin getting actually deep into that thought course of, and it generates a whole lot of insights. Doing this evaluation inside out, actually entering into the heads of the competitors and searching on the market from their vantage level, is immensely priceless.
ALISON BEARD: Why do you suppose that a whole lot of organizations wrestle to interact in that form of in-depth occupied with completely different potential futures and the place their assumptions is likely to be incorrect?
ARJAN SINGH: Lots of instances, it’s only a operate of sources and time. You realize? As a result of companies are busy. They’re busy when it comes to executing. There’s all the time issues to do. And, a whole lot of instances I get pushback when corporations speak about doing battle video games they usually say, “Oh, can we do that in two hours?” And the reply is, “Effectively, you can, but it surely’s in all probability not going to be superb. To do a well-thought-out sport, you want between a everyday and a half.
And so, then there’s logistics round getting individuals collectively, particularly in case you’re doing a strategic sport and there’s senior administration concerned. Their calendars are very guarded and laborious to get onto, not to mention asking for eight to 12 hours of their time for this. So, time and sources tends to be a part of it. And, the opposite half is cultural. Some organizations should not snug having their assumptions challenged. There’s a whole lot of construction hierarchy that comes into play. And in case you’re questioning a few of the senior individuals and their considering, it’s not taken the appropriate method. So, culturally it may be a problem, as properly.
ALISON BEARD: What info do individuals want or ought to they be given earlier than they begin?
ARJAN SINGH: So usually for a sport, you need to have a briefing doc that’s acquired sufficient background for everybody to be educated in an space. And one of many key distinctions is, for corporations which might be in a selected space they usually’re doing a sport with that area that they know rather well, so your pre-briefing paperwork tends to be so much lighter as a result of it’s an space that persons are accustomed to.
For areas that corporations want to get into or construct data in a short time, video games even have an effective way of doing that very, in a short time. And in these situations, the briefing paperwork can be much more complete.
Usually talking, the briefings are primarily based on market info, aggressive intelligence that you just may need. After which, actually deep diving into the businesses and never solely the cores of apparent metrics, however actually delving deeper into earlier battles, what they’ve executed in earlier situations, different classes from historical past that may be utilized right here.
ALISON BEARD: And so, then what occurs within the precise sport?
ARJAN SINGH: So, the sport is a collection of plenary classes adopted by breakout rooms, the place the groups work collectively. So in a typical sport, you’d begin with an introduction. You’ll give perspective when it comes to the subject, the core subject that you just’re making an attempt to resolve, what actions you’re anticipating to return out of it. You could current a bit of a part of the briefing doc so that everybody is on the identical degree of data.
After which, you undergo a collection of workout routines. And, the primary spherical you’ll usually say, “Okay. For the corporate that you just symbolize, construct a method to win within the market and suppose by way of varied levers that you just’re going to make use of. But in addition, actually take into consideration, ‘What does profitable imply for you? Shat does profitable imply on your group?’”
As a result of in a market, though you might have direct opponents, every firm often has a special definition of profitable. And so, it’s actually to know what that thought course of is, profitable, after which the course of these strategic themes that they’re going to return after.
You may also put in particular asks round, “How would you assault your group? How do you view the group, and what are the precise issues that you just’re going to do to remove market share or gross sales or different metrics that you just is likely to be ?” After which from that time onwards, the groups will put together their displays, they’ll come again, they’ll current. There’ll be panel of judges, doubtlessly, that can give suggestions. And the groups will usually return, they’ll revise their methods primarily based on suggestions, primarily based on how the competitors’s going to be attacking that. After which, you begin going by way of a collection of workout routines that delve deeper and deeper and deeper into that entire matter space.
After which the video games, usually, they conclude on the finish with turning it round from the corporate’s perspective. And the core query there’s, “Primarily based on these rounds of wargaming and battles that you just’ve gone by way of, what are the important thing insights that you just’ve generated? The place do you suppose are the most important alternatives to what you are promoting? The place are the most important dangers which might be there? The plan that you’ve proper now, are you ready for a few of these conditions?”
After which finally, it’s actually round driving actions. And, you prioritize: “What are the core issues that have to be executed proper now, proactively? What are the issues we now have to attend till they begin enjoying out within the market?” And a profitable sport really has names of departments or people subsequent to every of these motion objects who’re accountable and accountable for transferring that ahead.
ALISON BEARD: Yeah. That’s helpful. I believe we’ve all had the expertise of going to an off-site and brainstorming nice concepts, after which simply form of nothing occurs after. You talked concerning the battle for mobility that you just did along with your college students. Are you able to give us an instance of a battle sport that you just’ve executed with a consumer just lately?
ARJAN SINGH: So, wargaming tends to be a quite common exercise within the pharmaceutical biotech area. I don’t suppose I do know of 1 massive pharma biotech that has not executed a battle sport. So, all of them do it. And, a part of the rationale there’s you’re spending over a billion {dollars} to deliver a drug to market. There’s important pores and skin within the sport. And so usually, within the pharmaceutical trade, there tends to be a whole lot of wargaming as belongings are delivered to market, finish of Section 3, finish of Section 3, Decide to File, after which as soon as they begin launching into {the marketplace}.
And so, one current sport I’ve executed within the pharmaceutical area. And it was a possible blockbuster they’re bringing to market so their expectations are over $5 billion in income for the product. And so, the sport adopted the same construction to what I outlined. We acquired into particulars. And after we began entering into situations, one of many situations that got here up within the dialogue was round, “What if the FDA doesn’t approve the product?”
And in order you may think about, there was a whole lot of opinions within the room round, “Effectively, that will by no means occur. We all know what we’re doing.” Lots of defensiveness, as properly. And we mentioned, “Look, that is what it’s a must to do, is to actually put together for the worst and hope for the very best.”
And so, they went by way of the state of affairs they usually checked out, “If the FDA doesn’t approve the product, what’s going to they do?” They got here up with a playbook on what to do there. Conflict sport was accomplished. And about lower than a yr later when their approval date got here up from the FDA, the product was not authorized.
And so as an alternative of panicking, as an alternative of claiming, “Oh, now what will we do?” They went and regarded on the output from the battle sport and mentioned, “Look, we now have a playbook right here. We all know precisely what we have to do. There’s sure alerts within the information that we now have to reanalyze.” There’s these different issues that they needed to do. They form of executed on that and resubmitted it with the FDA. The product was authorized afterwards as they’d gone there.
ALISON BEARD: So it looks like a part of the objective is to determine the way you may fail earlier than you really do, or the way you’re going to take care of a loopy shock like COVID.
ARJAN SINGH: Precisely. The way you may fail earlier than you really do. The COVID shock was really an fascinating one. We’d executed, with the scholars in 2017, The Battle for the Traveler, which was a sport by which we had a few airways, American, Delta, we had the OTAs, Expedia, reserving.com. We had TripAdvisor, Marriott, which is a conventional lodge chain. The entire notion is everybody’s making an attempt to manage the traveler and everybody’s saying, “Hey, ebook on our web site. You don’t should go elsewhere.” Airways now are saying, “We’ll provide you with loyalty factors for not simply flying, we’ll provide you with loyalty for bank card expenditure and eating and different components, as properly.”
And in that sport, apparently in 2017, we really had the COVID state of affairs, which was the scholars had gone by way of constructing base case methods for the businesses they symbolize, how they’re going to win. And, one of many issues that got here out after spherical one was each single firm that was within the room had one specific assumption that their methods have been primarily based on, which was, “The journey growth in the US is more likely to proceed. And, that’s what we’ve constructed our methods on.”
And so the state of affairs we gave them, we made it very generic simply saying that, “Occasions occurred on this planet the place it’s going to have an impact of declining demand for journey by as much as 95%.” We put a remark in there from a fictional analyst saying that, “The journey growth in the US, the best way that we’ve recognized it, is lifeless. Leisure journey’s lifeless, and enterprise journey goes to take about three years to recuperate.” So, that was basically the COVID scenario.
And the scholars’ reactions first was, “Oh, no method. That is by no means going to occur. It’s foolish situations.” And we mentioned, “No. Undergo it.” And, each single firm needed to rework their technique and their playbook primarily based on that one assumption altering, that the market growth’s over. It’s going to be over for the following three years or so.
ALISON BEARD: So, it looks like the output from these classes is a playbook for quite a lot of situations that then you may put into motion and ensure is carried out if these situations come up?
ARJAN SINGH: That’s, and that’s actually the important thing to driving actionability after a battle sport. As you’d talked about, all of us have been to these conferences, which I name fascinating, nice discussions, a whole lot of nice thought course of that’s there. However then, it doesn’t actually result in something. Proper? And actionability, actually, from a battle sport comes from the playbook. And, the playbook’s usually structured round, “What actions ought to a corporation take? What these subsequent steps are. What are the actions to take versus a few of the situations?”
So if state of affairs occurs, construct a playbook in response to that. Perceive the important thing insights that you just’ve generated in your competitors, what their sizzling matters is likely to be, what are the areas the place they’re weak, the place you can actually focus in on? And having all these particulars in a quite simple format, to make use of transferring ahead.
Then, the opposite profit to a playbook is that that is the output of the stakeholders within the group. So, this isn’t a 3rd occasion telling them what to do or one particular person, it’s everybody aligning as a bunch when it comes to, “We perceive the core points. We perceive the place our alternatives are. We align on what our subsequent steps are going to be.” It’s a a lot faster technique to mobilize a corporation in the direction of a selected objective or actions.
ALISON BEARD: Yeah. I like the purpose you made within the ebook about how consultants may are available in and say, “Proper. That is what you need to do.” After which, they’re not ever liable for the end result of what they’ve really useful. There’s an enormous distinction. And so, how usually ought to organizations repeat this course of?
ARJAN SINGH: Lots of organizations do wargaming on an annual foundation. So, a few of the finest at school corporations have built-in battle gaming into their planning course of, so their annual planning course of. They’ll kick that off with a battle sport, take a look at completely different features of their aggressive atmosphere, after which they get into their planning.
So, that’s form of finest observe. Relying on trade, it’ll fluctuate. So in case you’re strategic points and also you’re in a conventional trade, you in all probability have to do one as soon as each couple of years or so. Should you’re in a fast paced space like know-how or others, you can do it yearly, you can do it a number of instances a yr. After which, it additionally will depend on the subject space, as properly. So for instance, in case you’re bidding on a big contract that’s value billions of {dollars} and also you’ve acquired a 18-month to 24-month gross sales cycle, I do know of corporations in these conditions, they battle sport each week.
ALISON BEARD: Hmm. Wow.
ARJAN SINGH: Yeah. I imply, for a few of the massive ones, just like the Jedi contract, I do know there are some corporations that did weekly ones. When there’s $10 billion on the desk, you attempt to work out not solely what you’re considering, however all the important thing stakeholders, and what that battle may appear like and all of the permutations and mixtures there, for which you’d want important quantities of rounds of state of affairs planning and wargaming.
ALISON BEARD: Yeah. So, it sounds such as you’re saying that particular groups inside organizations also can use this course of to consider their aggressive technique on a smaller scale, like signing an enormous deal.
ARJAN SINGH: Completely. You realize the gross sales workforce can discover a whole lot of profit from with the ability to promote extra product, meet their objectives. It may assist from a advertising and marketing perspective. There’ve been others, analysis and improvement, finance, technique. Lots of completely different purposeful areas can profit from this, however their matters might be completely different. Advertising and marketing can be eager about very various things from say, R&D and others. And so, it positively has an area for various areas inside a corporation, in addition to for start-ups.
This isn’t only a toolkit for giant organizations. The bigger organizations do spend a whole lot of effort and time on it. It is a quite simple toolkit that start-ups can use when it comes to in case you’re bootstrapped, you’re bringing a product to market, simply position play and see how the competitors’s going to react. It can save you a whole lot of expensive errors by doing that internally earlier than you begin deploying your methods externally.
ALISON BEARD: Have you ever ever had an occasion the place a battle sport led an organization within the incorrect route as a result of they didn’t come to the appropriate conclusions?
ARJAN SINGH: There’s been just a few. Mistaken route when it comes to optimizing belongings and prioritizing their developmental plans, it’s occurred a few instances. And, one of many primary causes for that was round not likely having the appropriate background info on the realm. It was an rising space, and they also needed to make sure assumptions on what was more likely to occur.
The massive subject there was the best way that they considered it was from their firm’s lens, not the competitors’s lens. That was a mistake that occurred, the place they ended up getting into a special route. However with monitoring and persevering with to look and having early warning alerts that you just take a look at, you may course appropriate very, in a short time. And so in that occasion, there are particular assumptions and hypotheses that that they had in an motion plan getting out of the workshop. They began deploying it. After which in a short time, primarily based on suggestions, what they found was that they have been considering by way of it the incorrect method, after which they course corrected pretty rapidly.
ALISON BEARD: So, you probably did speak about pushback and the truth that, particularly in rising markets, it’s laborious to foretell what’s going to occur. For these individuals who say to you, “All the pieces is altering so rapidly. I have already got a lot on my plate. I believe we will develop an excellent technique with out going by way of this course of,” what do you say?
ARJAN SINGH: That’s an important query. That occurs a whole lot of instances. The time dedication and taking 15, 20, 30 individuals from work and having them in a day or two to workshop, that’s all the time a problem. And, generally it’s faster to beat it by way of simply displaying earlier examples or worth. Generally it takes time.
I had an organization that had that very same pushback. And so they didn’t do a sport for, I believe it was virtually three years. After which lastly, they have been able to do it. As soon as they accomplished it, the primary response was, “Why didn’t we do that earlier? This is able to’ve saved us a whole lot of time, effort, heartache, and sources.”
Generally corporations simply should form of undergo that entire course of to get that realization as a result of finally it’s round blind spots and dear errors and alternatives that they may have recognized earlier. Lots of instances the catalyst for breaking that’s if somebody within the workforce’s really been by way of a sport. They’re the champions of speaking by way of wargaming and the advantages which might be there. That’s a course of to undergo. That’s one of many causes I wrote the ebook, was to only educate everybody when it comes to the advantages of doing this and having efficient, actionable video games of their organizations.
ALISON BEARD: Arjan, thanks a lot for speaking to me right this moment.
ARJAN SINGH: Nice. Thanks.
HANNAH BATES: That was Southern Methodist College adjunct professor Arjan Singh, in dialog with Alison Beard on HBR IdeaCast. Singh is the creator of the ebook Aggressive Success: Constructing Successful Methods with Company Conflict Video games.
We’ll be again subsequent Wednesday with one other hand-picked dialog about enterprise technique from the Harvard Enterprise Evaluation. Should you discovered this episode useful, share it with your mates and colleagues, and comply with our present on Apple Podcasts, Spotify, or wherever you get your podcasts. When you’re there, you’ll want to go away us a evaluate.
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This episode was produced by Mary Dooe and me, Hannah Bates. Curt Nickisch is our editor. Particular due to Ian Fox, Maureen Hoch, Erica Truxler, Ramsey Khabbaz, Nicole Smith, Anne Bartholomew, and also you – our listener. See you subsequent week.
