How can War Games help strengthen a Competitive Intelligence program's contribution to the success of every company? Many CI programs struggle to gain exposure and recognition within their organization and, as a result, are left vulnerable to cutbacks when external competitive forces or market conditions drive cost-cutting. How ironic that, the more threatening externalities become for a company, its CI program seems to diminish in value? Management's reflex is simple: cut "fat" processes lacking clear, tangible, difference-making impacts on decisions. Consequentially, however, they can injure the "muscle" of an otherwise productive intelligence team. Some CI professionals have discovered that War Games (and related competitive strategy simulations) can make a tremendous difference in the way executives recognize, appreciate and reward CI's contributions to company success. We'll discuss three ways War Games can help strengthen a competitive intelligence program. Specifically, the session will look at examples of War Games as a way to: - Prioritize tasking and monitoring of key intelligence topics and questions - Forecast possible future scenarios confronting the company in the market and industry - Simulate the actions and reactions of competitors or other actors on strategic, tactical and operational decisions

1. How War Games Can Help
Strengthen a Competitive
Intelligence Program
A Complimentary Webinar from Aurora WDC
12:00 Noon Eastern /// Wednesday 5 December 2012
~ featuring ~
Tim Smith
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
Arik Johnson
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2. Agenda
 Critical Link between Intelligence and
Simulation
 Is a war game the correct tool for our
situation?
 What it takes to design a successful war
game
 Forecast future scenarios to simulate
competitive and market responses to our
proposed strategy
 Summary, Q&A, and Discussion
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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3. What we are not covering today
1
The use of generic, or “canned” war games,
used to familiarize participants with the process
2
Simulation software that selects outcomes and
drives the results of the game
3
The use of war games to build team work or
to assess strategic smarts
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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4. An assumption about You…
We are assuming for today’s webinar that you have
a basic understanding of what a Competitive
Simulation, or business war game, is.
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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5. The Standard CI Process, and where War Gaming Fits
Identification of
business issues
The challenge here is to be proactive,
Not just reactive.
Collection
Analysis
War Games work best here
Dissemination
Results
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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6. It’s all about the Intel
Most strategic planners understand that good intelligence
comes before effective strategy. It is your job to remind
them of it.
Good intelligence product pre-game is absolutely vital.
A lack of proper preparation Can lead to more harm than good.
Garbage in, Garbage out!
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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7. The Two Most Common Problems
1. Many CI Programs are used more as a market research
asset. They wait for tasks coming from multiple locations,
with no regular interaction with those directing strategy.
2. Even worse, many CI Practitioners act as research librarians,
because they are so focused on secondary research,
which is admittedly overly abundant, that primary has
been ignored. HUMINT need not equate to “dumpster diving”.
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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8. Access to the Commander
The one area that the military does better than business…
Running a successful war game will
not only grant you the magic key
during the development phase,
but it will also keep You in the loop
post-game.
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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9. One Very important Piece of the Puzzle
The Intelligence Collaborative
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10. Your Role in Defining Purpose and Scope
 Provide guidance on what the purpose of the game will be, taking into account
the needs of your Sponsor and other key stakeholders
 Come to the Sponsor prepared to answer questions on new entrants, potential
M&A in the relevant market, and a good understanding of potential disruptors
 Limiting the scope will not only reduce your workload prior to the game, it will
create much more focus on the key issues your Sponsor wants explored
 Most importantly – Ensure that the game is designed to deliver executable
strategies and tactics that can be measured
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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11. Who Should Participate?
Anyone who can
Champion the planning
activities post-game
Those who best
understand the
relevant market, and
have an open mind to
the outcome
 A broad mix of functions is most effective
 Identify and include key influencers within the functional areas – those
whose buy-in will help when it comes to implementation of the ideas
surfaced during the game.
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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12. The Power of the Process… And what it
Means for You
1. You allow the Participants to get into the mind of the
entity selected and role-play their best interests
2. Through simulation, you define several valid market
scenarios that can be used to generate action plans,
contingency plans, or intelligence missions
3. Reinforce how important it is to use market data and
competitive signals to adjust your strategy
4. The game is itself a Decision Tree that you can replay
at your leisure as the real world develops to further
explore outcomes from the exercise.
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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13. After-Action Sample:
Competitive Highlights
The table below gives a brief description of how the Market Referees felt each of the two
competitive rounds played out. For more detail on how they evaluated the teams, and the
reasoning behind it, please refer to the Market Team section of the report.
Team
Round 1 Synopsis
Round 2 Synopsis
Home
Team
• Standard, but steady
• Took the feedback from the Market to
heart, but were not very pro-active
towards competitors
• Their positioning idea was original and innovative
• Did not back down to competitive messaging
• Liked prioritization of customer segments
Rival 1
• Strategy seemed to be all over the
place in Round 1
• Did a good job of addressing
customer needs and wants
• Very aggressive on proven market results
• Clear strategy on their product vs. ours
• Broad-based attack on our launch
Rival 2
• Clear leader in Round 1
• Very coherent strategy
• Very clear strategy, but not enough on execution
• Social media comms was good, but overresourced
Rival 3
• Seemed a bit all over the place in
Round 1
• Not very clear on what their response
to product launch was
• Market liked the discounting plan
• Also liked the comparison to other flawed
products
• Provocative sales force increase & loyalty
program
The Intelligence Collaborative
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14. After Action Sample:
Key Issues and Outcomes
The issues highlighted below were derived from the Simulation.
Key Issue
Competitor Will…
Our Response
Defend lack of
customer
service data
Competitors message this issue to
mitigate launch
• We will set up feedback loop for representatives and customer
account team to gauge impact of lack of time-series data at
launch; share best practices on how to handle
• Develop rep response indicating that several other recent product
launches did not have time-series data at launch
Messaging
• Tout their longevity in the product
class.
• Claim our product is “too radical,”
untested, barely passing
regulatory review
•
•
•
•
Competitor
Increase in Ad
Spend
We expect that the incumbents will
increase their spend in an effort to
lock up key institutional clients
• Leverage consumer demand for new retirement options
• Maximize the impact of the news event around the availability of a
new class of product
Feet on the
Ground and
Selling
We expect at approval that there
may be some financial options data
that we won’t be permissible in
promotion.
• Right-size the new prods team to a competitive size
• Via the Blue Guide can we share product data that is still under
review
• Ability to communicate regularly with speakers via intel network
wiki on relevant product data
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
5 successful beta clients
Rivals products have had negative returns for 5 years cumulative
Educate on what is required and how to manage
Can utilize heavier social media communication, particularly via
our large FaceBook and Twitter presence
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15. Related Techniques
Scenario Analysis
Competitor Analysis
Blindspot Analysis
Johari Windows
Financial Ratio / Statement Analysis
STEEP and Industry Analysis
Executive Profiling / Shadowing
Value Chain Analysis
Supply Chain Analysis
SWOT Analysis
The Intelligence Collaborative
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16. Additional Advice
1. Beware of mission creep as it relates to the
scope of the game
2. Resist the temptation to include outsiders as
Participants
3. Seize the initiative post-game
4. Further develop the relationships you made
during the pre-game work, and the war game
itself.
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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17. Questions,
Comments…
AuroraWDC.com
800.924.4249
A Trusted Advisor Since 1995
Arik Johnson
Founder / Chairman
Arik.Johnson@AuroraWDC.com
+1.608.630.4242
Tim Smith
Director of Competitive Simulations
Tim.Smith@AuroraWDC.com
+1.714.222.4955
The Intelligence Collaborative
http://IntelCollab.com #IntelCollab
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