By Fon Hah

Abstract

A comprehensive review of risks during strategy development is key to the success of any strategic endeavour. Despite this, recent surveys reveal that mismanagement of strategic risks accounted for around 60% of major declines in market capitalization. Simulating changes in the business environment – by using a model that dynamically captures industry drivers to uncover issues – assists in the development of coping mechanisms and solutions. The objective of this paper is to demystify simulation, outline its benefits in strategy development, and to present three different types of simulations strategists can use – Wargaming, Monte Carlo, and System Dynamics Modelling.

Read more: Strategy Development With Applied Simulation Techniques