1. Execution excellence through disciplined rehearsalDR. PAUL A. ROMAN, CD, PhD, P.Eng LCOL (Retd) FRED M. AUBIN, CD, MCGI SRTC & QSB 2013

2. .and if this is what you were expecting today,. you are about to be sorely disappointed SRTC & QSB 2013 3. IN OUR JOURNEY FROM HERE..TO HEREWhat militaryskills, procedures, doctrines, methodologies anddisciplines from theprofession of arms havethe most traction in thecommercial world?More importantly, whichones would fill uniquecapability gaps in thecommercial world ? SRTC & QSB 2013 4. because everyone knows the military are experts at strategy! SRTC & QSB 2013 4 5. Despite this historic anomaly, the possibilities were endless:Strategic Competitive IntelligenceStrategicStrategic Competitive MissionTargetingAnalysis Corporate Centres ofGravity Contingencies, Branc Strategic Plan Developmenth Plans & Sequels & Campaign DesignStrategic Execution, Management & Refinement SRTC & QSB 2013 5 6. The Strategic Execution ChallengeIf you are in an adversarial andcompetitive businessenvironment, how do youevaluate the various coursesof action open to you? How do you know whether your strategy is truly comprehensive, integrated, ad aptive and networked? SRTC & QSB 2013 6 7. The Strategic Execution Challenge How do you test your plans before you execute them?How do you test your decisionsupport structures?How do you put your planunder realistic stress beforeexecution? SRTC & QSB 20137 8. The Strategic Execution Challenge How do you establish, align and integrate your corporate authorities, responsibilities and accountabilities? Are they aligned with the actual decisions that need to be made? Who plays the role of your adversary, your competition, or your clients? Who is your BAD GUY? SRTC & QSB 2013 8 9. The Strategic Execution ChallengeHow is the feedbackpresented to your executiveleadership prior toexecution?What separates a great planfrom a self-fulfilling prophecy,or..a self-licking ice-cream cone? SRTC & QSB 2013 9 10. The Military Challenge versus The Business Challenge How are your requirements for Disciplined Testing, Refinement, Rehearsal & Execution different than those of the military?Short Answer: theyre not. SRTC & QSB 2013 10 11. The Military Challenge versus The Business ChallengeIn business, as inbattle, INTELLIGENCE, STRATEGY, PLANNING, DECISIONMAKING and EXECUTION, areHUMAN ACTIVITIES and thetruest test of those things canonly be accomplished withhuman beings in the loop.Tracing a Gantt Chart ordoing the Six Sigma streetdance is a poor substitute. SRTC & QSB 201311 12. The Military Challenge versus The Business Challenge The best way to rehearse is if the players that are testing the plan are the very people that will eventually have to make critical decisions in the execution of the plan. .and do it in a way that ensures your decision support SIMULATION . promotes decision support STIMULATION SRTC & QSB 2013 12 13. How did we do it in the military? Simply, we wargamed every course of action before committing to a preferred strategy or plan. SRTC & QSB 2013 13 14. How did we do it in the military?We rehearsed bywargaming any and allcommanders that had tomake decisions in theexecution, orsynchronization of thatplan. SRTC & QSB 201314 15. How did we do it in the military?We rehearsed bywargaming the actionsof a realistic adversary ina realistic operationalenvironment. SRTC & QSB 2013 15 16. How did we do it in the military? We wargamed in a cooperative leadership and learning environment that believed that sweat and tears in a wargame were preferable to blood and tears on the battlefield. SRTC & QSB 2013 16 17. How did we do it in the military? So, whats the equivalent of blood, sweat and tears on your corporate battlefield? SRTC & QSB 2013 17 18. The Strategic Competitive AdvantageWargame Hindsight becomesBusiness Foresight SRTC & QSB 2013 18 19. What is Wargaming?Wargames are real-time, action-reaction, role-playing workshops that pit yourkey real-life decision makersand managers (Blue Team) .against real-time competitiveadversaries (Red Team).and disciplined by anexecutive level White team. SRTC & QSB 201319 20. Its a game in name only. Wargaming is a methodological discipline to test your plans that is also designed to promote: risk mitigation, innovation, mechanisms of discovery forleadership, mechanisms of voice for yourteams real-time organizational learningfor all. SRTC & QSB 201320 21. Its a game in name only. The aim of wargaming is to ensure continuous improvement in your ability to compete and win on your corporate battlefield. The most important element of Wargaming is not the tool used, but the people who participate. SRTC & QSB 201321 22. Its a game in name only. Wargaming is a conscious attempt to visualize the flow of business operations, given joint strengths, weaknesses, dispositions, c apabilities and possible courses of actions available to business actors in a given business sector and environment.and its the best way ofgetting into your competitorshead, their decision cycle, theirOODA loop. SRTC & QSB 201322 23. Its action reaction - counteractionWargaming is a disciplined roleplaying activity where key actorsreact to critical events using anaction / reaction / counteractionmethod of friendly and competitorinteraction.Each step in the execution ofthe plan or strategy is examinedin the following detail: Action Reaction Counteraction Observations Record Review Learning SRTC & QSB 2013 23 24. Wargame preparation is a LEADERSHIP activity!Your corporate leadership, strategy, plan and businessenvironment are the foundations to preparing, designing andexecuting your Wargame. Mission Analysis Constraints Vision Restraints If theres a problem with any of these, the wargame will Assumptions show it. SRTC & QSB 2013 24 25. Wargame conduct is a LEADERSHIP activity!Every event is tested against a competitive reality.Action ReactionAction Counteraction Reaction Observations Action Counteraction RecordReaction Observations ReviewCounteractionAction Record LearningObservationsReaction Review RecordCounteraction Learning ReviewObservations LearningRecord Review Learning SRTC & QSB 201325 26. Wargame lessons are a LEADERSHIP activity!After Action Reviews (AARs) are a LEADERSHIP responsibilityand are conducted by your corporate leadership, facilitated by theWhite Team Lead and supported by the Blue and Red Leads. They are inclusive butdisciplined. Must be constructiveand detailed. Egos are left at thedoor. Lever innovation byposing what ifquestions. SRTC & QSB 2013 26 27. The only restriction is LEADERSHIPs imagination! Scale? Scope? Focus? Method?Wargaming is a HUMAN activity the SIMULATION must provide STIMULATION SRTC & QSB 201327 28. What type of Wargame suits you best? There are 3 fundamental types of Wargames: The Course of Action (COA) Wargame The Rehearsal Wargame The Red Team Exercise SRTC & QSB 201328 29. Course of Action Wargaming These are a series of two of more sequential and comparable wargames involving the same conditions, actors and weighting criteria to determine the most viable options available in terms of risk, execution, pay off, etc. This is a decision support tool for senior executives to recommend a distinct plan of action to corporate leadership. Red & Blue players are normally drawn from the extant pool of executives normally involved in your companys strategic and operational planning process. SRTC & QSB 201329 30. Course of Action Wargaming Example: ProblemSituation: Cadbury Schweppes Purchase of Adams for $4.2 BillionProblem: Stagnant Adams share price and bleeding market share.Mission: Demonstrate strong commercial and financial successquickly to restore share price. AdamsWrigley Global #2 Chewing gumGlobal #1 Chewing gumBusiness War Games, Ben Gilad, 2009 SRTC & QSB 2013 31. Course of Action Wargaming Example: Conduct Three day Course of Action War Game Involved 50-60 primarily internal business leaders AdamsWrigley Global #2 Chewing gumGlobal #1 Chewing gumBusiness War Games, Ben Gilad, 2009 SRTC & QSB 2013 32. Course of Action Wargaming Example: Results Cadbury recovered costs a year early From my perspective, these accomplishments reflect the focus Adams core brands grew by more thanand effort of a great team of people7% and margins returned to 19% across multiple fronts and informed by an outstanding war games process of business and financial self- analysis Trident (Adams) sales doubled making itthe top brand in the world Todd Stitzer CEO Cadbury March 2008 Adams gum share in the US grew from25% - 34%. Wrigleys remained flat at34% Globally Adams went from 7% - 27 %while Wrigleys remained flat at 34% Share revenue averaged more than 20%driven by a share price that quicklyrecovered the 30% initial loss and movedon to new heights. Business War Games, Ben Gilad, 2009 SRTC & QSB 2013 33. Rehearsal Wargaming A Rehearsal Wargame is acomprehensive exercise totest a single accepted planprior to its execution. The BLUE TEAM involves allsenior executives who mustmake decisions and manageactivities in the execution of thatplan and confined to theiraccepted decision support roles. The RED TEAM is drawn from corporate leadership teamor subject matter experts. SRTC & QSB 2013 34. Rehearsal Wargaming Example: Objective Situation: Biogen new drug for MS Fall 1995 Task: Validate Pricing and Market Strategies for New Product Launch Focus: Premium pricing strategy based upon a quality guarantee full refund if condition deteriorates Wargaming for Leaders. Herman, Frost & Kurtz, 2009 SRTC & QSB 2013 35. Rehearsal Wargaming Example: Conduct Three move game Primarily internal role players (approximately 20) 4 competitive teams and a market team Move 1 early success but confusion over the guarantee resulting in regulated requirement for a reserve fund stock price drops Move 2 guarantee adjustments made and prices are discounted. Incumbent also discounts and improves delivery mechanism Move 3 new drugs on the marketWargaming for Leaders. Herman, Frost & Kurtz, 2009 SRTC & QSB 2013 36. Rehearsal Wargaming Foresights Generated: The need to convince Medicare of the drugs advantages, otherwise customers would have difficulty getting the drug covered The need to field a deluge of questions from patients wanting details about the guarantee SRTC & QSB 2013Wargaming for Leaders. Herman, Frost & Kurtz, 2009 37. Rehearsal Wargaming Example: Results For the actual launch: price was competitive guarantee softened. As of 2003, Biogen claimed their MS drug to be the market leader in the US. Being bold in marketing a new product can pay big dividends, but the need for caution in highly regulated industries became readily apparent in the game. SRTC & QSB 2013Wargaming for Leaders. Herman, Frost & Kurtz, 2009 38. RED TEAMING A Red Team Exercise is similar to a rehearsal Wargame with the exception that none of the Red Team players are drawn from companys decision support stakeholders. Each RED TEAM player is an outsidesubject matter expert that is not acompany stakeholder and is onlygiven a reasonable amount ofinformation that a normal competitorwould have. The RED TEAMs role is not merely to test the plan asadversarial players but rather to put it under extreme competitivestress. SRTC & QSB 2013 39. RED TEAMING EXAMPLE Operation Overlord was the operation that launched the invasion of German-occupied western Europe during World War II by Allied forces. commencing on 6 June 1944. A 12,000-plane airborne assault preceded an amphibious assault involving almost 7,000 vessels. Nearly 160,000 troops crossed the English Channel on 6 June; more than three million troops were in France by the end of August SRTC & QSB 2013 40. RED TEAMING EXAMPLE During the planning phase, a multidisciplinary staff of over 150 was created to shadow the OVERLORD planning team. Their only mission was to develop reasonable challenges to the plan from a friendly, enemy, environment al and chance perspective. They were ordered to find ways to make it fail. Over 4 months, they established 700 issues which were exercised and eventually dictated changes to the OVERLORD plan. SRTC & QSB 2013 41. RED TEAMING EXAMPLE: RESULTS OVERLOAD is historically acknowledged as a huge success. Nonetheless, 30% of the RED TEAMs predictions still came to pass despite changes to the revised OVERLORD plan. However, since commanders and staffs were prepared for these issues, branch plans and sequels were already prepared. SRTC & QSB 2013 42. RED TEAMING EXAMPLE WHEN YOU DONT DO ITOVERLOADMARKET GARDENGOOD BAD SRTC & QSB 2013 43. In summary wargaming is all about: Evaluating courses of action to recommend a distinct plan of action to corporate leadership; Levering rehearsals as a comprehensive exercise under conditions of extreme competitive stress to test critical plans prior to execution; Reinforcing Unity of Thought, Purpose and Action throughout your corporate team through action/reaction/counter-reaction role playing; Visualizing of the flow of business operations, given joint strengths, weaknesses, dispositions, capabilitie s and possible courses of actions available to business actors in a given business sector and environment. WARGAME HINDSIGHT becomes BUSINESS FORESIGHT SRTC & QSB 201343 44. Want to learn more? SRTC & QSB 2013 44 45. Want to learn more? Conducted over 3 days of formal instruction and practical scenario-based exercises, the program will: Illustrate how Wargaming provides a unique competitive advantage. Utilize Wargaming techniques to develop comparative and equitable strategic courses of action. Demonstrate Wargaming as a real- time, action-reaction, role-playing methodology that pits your real-life decision-makers and managers against real-time adversaries. Teach Wargaming techniques as aTORONTOdisciplined baseline for strategic execution rehearsal.13-15 May 2013 SRTC & QSB 2013 45 46. Food for thought? Dancers rehearseShouldnt You? Militaries rehearseActors rehearse SRTC & QSB 201346 47. Execution excellence through disciplined rehearsalDR. PAUL A. ROMAN, CD, PhD, P.Eng LCOL (Retd) FRED M. AUBIN, CD, MCGI SRTC & QSB 2013