• Simulation. All war games, business and otherwise, are simulations. Simulation is what allows participants to test or practice actions in a safe place before they commit real time and money. Simulation requires a model of some kind, even though the model may be hidden (kept in the background) or even invisible (mental models).
  
  
• Competition. A business war game that doesn’t involve competitors is like an election with only one candidate: it’s not likely you’ll learn anything. Most models I’ve seen, even those designed to forecast sales and market share, do not simulate competitive dynamics and therefore are not well suited for business war games.
  
  
• Marketplace. Business war games simu late the arena in which you go up against your competition, namely, the marketplace. Business war games simulate competitive marketing strategies, and they consider financing, production, cost structures, and supply chains insofar as those areas affect marketing-strategy decisions and bottom-line results.

• Be qualitative, quantitative, or a mix.
• Be generic (for educational purposes) or market-specific (for decision-making).
• Rehearse a single strategy in detail or contrast multiple strategies under multiple scenarios.
• Test specific options or elicit and explore blue-sky alternatives.
• Build on financial models, market models, forecasting models, or mental models.
• Rely on human “umpires” or computer models.
• Focus on making managers smarter, or on making smarter decisions, or both.
• Cost less than $25,000 or more than $500,000 to set up, and consume as little as half a day or as much as a week to execute.

• A team of regional sales managers discovered that they were making fundamental mistakes about competitors and their own capabilities, despite twenty-plus years’ experience in their industry. They changed course to a strategy they considered impossible prior to the war game. It worked.
  
  
• A team charged with revolutionizing their industry came up with a brilliant plan that passed every conventional review. In their war game they found that if they implemented their plan, they would trigger a devastating price war. They abandoned the strategy.
  
  
• A team planned to introduce a new product with a strategy that appeared to be Marketing-101 obvious. Their war game showed the strategy would likely produce a profit hemorrhage, not a profit gusher. They tested another strategy, liked it, and switched to it.
  
  
• A team wanted to know if top management’s aggressive sales goal was achievable or a pipe dream. In their war game they found it was the latter… and, when presented with the evidence, top management agreed.

• Given the situation faced by your business, what are the benefits of surprise and what are the costs of being surprised?
• Do you want to rehearse one specific strategy or test multiple alternatives?
• Do you want to create a widespread culture of rigorous thinking about strategy or do you want to bring new technology to a small group of strategists?
• Do you want to find the best answer or host a bonding experience?
• Do you face an immediate, do-it-now crisis, or do you want to find a break-out-of-the-box change to long-standing practice?
• Will you run many games or just one?

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