‘Playing war games to win’ by John Horn, McKinsey Quarterly, March 2011

I chose this article because war games are a fascinating process that MTP includes within some finance and strategy programmes and occasionally run as ‘one-off’ exercises. We find that war games add much insight to the likely actions of competitors and other key players in the market place. Such exercises never fail to engage the participants and are typically well received, even though the long term benefits can be difficult to measure.

What is good about this article is that the author does not fall into the classic consultancy trap of suggesting war games as a panacea that is relevant to all marketing challenges. The author starts off with an excellent example of how a war game can work well, a high tech company preparing for the competitive challenges to be faced after the financial crisis. But he also points out the dangers; that some companies misjudge the context in which war games are appropriate and fail to include the right participants. He also makes the point that war games only work when there is a ‘moderate level of uncertainty’. If there are too many uncertain factors and potential scenarios, it may be better to use other planning tools.

When deciding the design and the participants, the author makes the distinction between three types of objective - tactical, strategic and organisational alignment, the latter being the need to engage key stakeholders and familiarise them about the issues. I was okay with this until the objectives were extended to ‘broadening the understanding of the industry’ for less experienced participants. Whilst I can see that this could well be the outcome for all participants to some extent, it is important to separate the war game process from more conventional management development activities; the primary objective is to make better decisions, not to improve the business acumen of less experienced managers.

The article ends with a discussion of how frequently war games should be carried out and suggests a regularity that might, in our view, adversely impact their ability to challenge and question existing thinking. War games need energy and creativity which can be lost if it becomes yet another routine management process. We believe that war games are best carried out as special events relating to a particular proposal, rather than something that supports day to day decision making.

Though the article makes some interesting points, it does miss out a lot, three key issues in particular.

First - and a surprising omission from a consultancy company - is the importance of high quality facilitation, which should be independent, knowledgeable and experienced.

The second, and connected, missing factor is the need to move the participants away from their internal mindset and the often complacent attitudes towards competitors that can exist in sales and marketing departments. It is all too easy for participants to play the role according to their pre-conceived ideas about competitors, rather than their likely behaviour. The facilitator can minimise this danger by thorough briefings, by skilful matching of people to roles (including bringing in outsiders) and by challenging mindsets throughout the process.

The final point is the need for thorough data preparation and analysis before the war game takes place, so that the role playing is informed and, where appropriate, decisions are data driven. For war game participants, it is not just a question of turning up to play an enjoyable role; it should be a rigorous exercise which moves everyone away from their internally focussed mindset and gets them to put themselves into the shoes of others in the market place. It is never easy but, if done well, the pay-off can be enormous.

Click here to read the article in full;
https://www.mckinseyquarterly.com/Organization/Change_Management/Playing_war_games_to_win_2757