If you answered "the competition," you're far from alone. Companies making decisions about developing and launching new products commonly fail to anticipate their rivals' motivations and actions. Moreover, the failure often contributes to innovation-related disappointments, many of which are below the radar and quite insidious: your rival, for example, discounts prices to encourage customers to stock up on its product rather than try yours, ties up distributors so you can't get shelf space, or duplicates your service to dissuade consumers from switching.

Unfortunately, in the heat of competition it's extraordinarily difficult for players to identify such threats, because the tendency to overlook rivals is deeply ingrained in human behavior. Indeed, neglecting to think about competitors is one of dozens of natural human biases"”along with excessive optimism and overconfidence"”that subconsciously affect strategic decision making. Addressing the challenge requires tools and processes that help companies "de-bias" their decisions.

Recognizing this problem, some companies are tackling it head on by integrating war games into their innovation activities. By simulating the thoughts, plans and actions of competitors, these companies are improving their products and services, while gaining a deeper understanding of how their innovation assets compare with those of rivals"”insights that help them better identify, shape, and seize opportunities.

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Keywords business model, business strategies, sizing up competition, war gaming in business