Asymmetric Competition in Business: An Introduction to Business Wargaming Concept

A core challenge for all businesses is understanding, anticipating, and preparing for competitive activity in the marketplace. A powerful tool is business war games, which use war game strategy to arrive at unique perspectives on a business strategy. This unique method of strategic thinking considers elements of a plan that are often missed in traditional strategic planning.

Many business plans contain a section on competition, but the level of detail is often woefully inadequate to arrive at any meaningful understanding of the competitive landscape. Business wargaming can be a powerful way to address this competitive landscape in your business strategy by leveraging asymmetric competition. This involves unconventional business strategies that give one party a distinct advantage, such as identifying core advantages, finding new financial formulas, and keeping competitors off-balance.

Business war games are designed to dive deeply into the competitive environment and gain a robust understanding of how competitors may behave and what options are available. Additionally, war games usually consider “uncontrollable” elements such as regulation, economy, weather, market trends, and technology.

The Asymmetric Business Wargaming Framework

The Asymmetric Business Wargame Framework

The Asymmetric approach to business war games is to identify the primary competitors in a given marketplace - usually competing companies, brands, or products. We start with a deep dive into the existing market research, including consumer research and competitive disadvantages, studies on consumer behavior, pricing, brand awareness, and any other insights that may be available.

A team approach is ideal. War games are most effective when a cross-functional group of people from various levels of seniority is assembled into three to four teams of approximately six people each.

In war gaming, one team represents the “home team,” or the client company’s brand or product. Teams two and three each represent one of the most significant competitors in the marketplace. The fourth team represents “the market” - such elements as regulation, government intervention, the economy, technology, etc.

A flowchart titled "How Does Business Wargaming Work?" illustrates the interaction between "Client Company," "Competitor A," "Competitor B," and "Competitor C" with offerings, market-share, and financial effects. Multiple teams (Company, Competitor, Judge, Market) play roles in this asymmetric marketing strategy.

Strategic Thinking Frameworks

We like to start business strategy sessions with a half-day session that covers concepts of conflict such as The Art of War, and other principles of military strategy. An introduction to competitive strategies and frameworks, such as the Blue Ocean Strategy, Porter’s Five Forces, SWOT Analysis, and Strategic Group Analysis, is presented so that the team can access similar tools and models during the war game process.

A diagram of SWOT analysis, designed by a marketing agency, features a shield-shaped graphic split into two sections. The top section, labeled "External Factors," includes "Opportunities" and "Threats." The bottom section, labeled "Internal Factors," covers "Strengths" and "Weaknesses."

The remainder of the first day and all of the second day are divided into a series of business strategy sessions where the teams break out to evaluate the situation, analyze their competition using the frameworks, and develop a range of competitive strategies and tactics, including considerations of asymmetric quality competition and numerous mechanisms proposed to explain competitive asymmetries, designed to exploit their unique set of strengths and weaknesses in the context of their competition.

After each break-out session of the war game, the teams come back together to present their findings - often in a highly energized, fun, and competitive environment. War gaming is a unique opportunity for team building in addition to its role as a strategy development process.

In the end, the work is condensed into a finding report that is then used by the company’s leadership and marketing teams to design strategies, plans, campaigns, and contingency plans - all designed to address the unique competitive situation that the company is facing.

Where do War Games Fit in the Planning Process?

Using a war game strategy to evaluate likely outcomes and actions by competitors, considering multiple mechanisms that contribute to competitive asymmetries, is a powerful tool. But where do war games fit in the planning process?

Flowchart titled "Business Wargaming" showing how this approach enhances traditional strategic planning. Steps include: Assessment of Strategic Variables, Strategy Development, Choosing a Strategy, Testing the Selected Strategy, and Lessons Learned. Ideal for marketing agencies in Madison WI exploring asymmetric marketing strategies.

The traditional strategic planning process seeks to gain a competitive advantage through a sequential process. This process includes:

  • Assessment of Strategic Variables
  • Strategy Development
  • Choosing a Strategy

Business war games can add value by being placed at the end of this process to test the selected strategy to evaluate:

  1. (Re)Actions of Competitors
  2. Potential Surprises
  3. Discontinuities and Frictions
  4. Potential Regulatory Actions

The unique nature of business war games provides robust insights into the competition's fundamental nature that is impossible from a simple desktop analysis. Business strategy is a complex topic; a business war game can be another tool in your planning kit.

Scenario Planning

Scenario planning is very similar to a business war game in that it seeks to assist decision-makers in identifying courses of action and estimated impacts and then evaluate responses and anticipate outcomes, similar to how a business model innovator like Jeff Bezos continuously changes the game by focusing on customer needs and redefining business models. It is different primarily in the execution and approach.

Business war games use teams that role-play competitors or markets, considering business models predicated on offering better terms and innovative strategies. This role-playing methodology is key to actively considering key stakeholders' potential actions or reactions in a market.

There are five steps in the scenario planning process:

  • Determine a Strategic Position
  • Prioritize Objectives
  • Develop a Strategic Plan
  • Execute and Manage the Plan
  • Review and Revise the Plan

The OODA Loop

The OODA Loop is the cycle of:

  • Observe
  • Orient
  • Decide
  • Act

Military strategist and United States Air Force Colonel John Boyd developed it. This approach explains how agility can overcome power, similar to how Amazon leverages its distribution centers to gain a competitive edge. It is frequently used in cyber security and cyber warfare applications.

A circular diagram representing the OODA Loop with four stages: Observe (red arrow), Orient (yellow arrow), Decide (blue arrow), and Act (green arrow), all pointing clockwise. "OODA Loop" is centered within the circle, emphasizing an essential tool for any marketing agency in Madison, WI.

Harry Hillaker, one of John Boyd's colleagues, explains the OODA Loop as:

The key is to obscure your intentions and make them unpredictable to your opponent while you simultaneously clarify his intentions.

That is, operate at a faster tempo to generate rapidly changing conditions that inhibit your opponent from adapting or reacting to those changes and that suppress or destroy his awareness.

Thus, a hodgepodge of confusion and disorder occur to cause him to over- or under-react to conditions or activities that appear to be uncertain, ambiguous, or incomprehensible.

Competitive Dynamics

Companies often plan without giving due importance to competition. Competitors, if considered at all, are generally evaluated as a static threat to the plan. However, competitive dynamics call for evaluating competitors, considering factors such as a distinct business model and the dominance of an otherwise preferred brand as unpredictable variables.

For every move a company makes, one can assume that each of its competitors will act or react in a manner consistent with its objectives - often blunting or even destroying the capacity of a strategic plan to succeed.

A list of tools that can be used to evaluate the competitive dynamics of a market are:

  • Competitive Intelligence
  • SWOT Analysis
  • Blue Ocean Strategy
  • 5x5 Risk Matrix
Dramatic chessboard with white and black chess pieces on either side. Plastic toy soldiers in combat positions are arranged on top of the board. Smoke and bright light in the background create an intense, cinematic atmosphere, reminiscent of an asymmetric marketing strategy devised by a Madison WI agency.

Use Business Wargaming in Your Business

Asymmetric, led by former Army Delta Force operator and corporate executive, Mark Hope, can help you implement these ideas in your business. You can contact Mark by email at mark.hope@asymmetric.pro, or by telephone at +1 866-389-4746, or you can schedule a complimentary strategy discussion by clicking here.  You can read all of his articles on Medium.

Mark Hope - Asymmetric

Mark Hope

Mark A. Hope is a co-founder and Partner of Asymmetric Marketing – a unique agency specializing in building high-performing sales and marketing systems, campaigns, processes, and strategies for small businesses. Asymmetric has extensive experience with organizations across many industry segments. If you would like some help in implementing ideas like these in this article, feel free to give Mark a call at 844-494-6903 or by email at mark.hope@asymmetric.pro. Read Mark's other work on Medium.

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