The Art of the Digital Wargame: Winning Strategies for an Unravelling Industry Structure

Virtusa recently helped a large bank that is facing disruption to its core business from Asian super-competitors, Tencent and Alibaba. This battle, despite the geography, is a case study for Western incumbents in service industries as they strategize on a pre-emptive move or a response to US technology giants (e.g., Facebook, Amazon, Apple, Google), who are on an eventual trajectory to disrupt their respective industries.

In this case, our client watched with concern as Alibaba and Tencent established partnerships, invested in local companies, and built government relationships throughout its market. Our client worried that, as had happened in China, the local marketplace was about to be upended as these super-competitors, whose roots were outside banking, were positioning themselves to rollout their broader ecosystems, including payments and banking services, to domestic consumers. As we described in our earlier paper “The End of Business as Usual and the Unraveling of the Vertical Industry Structure”, these super-competitors provide a lifestyle SuperApp. In this SuperApp, banking services, starting with payments, get embedded as part of a day-to-day lifestyle where banking is no longer a destination, but a value-added service. Using deep pockets, large marketing budgets, and viral marketing techniques, these super-competitors attract large user bases who then get hooked to the SuperApp. Once the customer is in the SuperApp ecosystem, and can appreciate a breadth of connected services, these super-competitors rapidly make it convenient for the customer to switch out of incumbent banking, insurance, content, retail, and communication services through promotions and intuitive user experiences that are powered by analytics and artificial intelligence. For our client, we estimated that 30% of its core retail and small business service lines was at risk of short-term disruption, which also threatened its long-term viability. Our client required a strategy to respond, and needed it fast.

Virtusa customized a traditional strategy tool, the Wargame, to help our client develop a strategic response to the threat of digital disruption. Our strategic researchers canvassed the globe, teasing out insights that allowed us to create competitive playbooks against these super-competitors. We analyzed digital trends and market insights to provide a backdrop for interactive sessions with the client in order to develop and test market moves and countermoves against traditional and disruptive competitor actions. Most importantly, we mobilized a small army of employees into action, making them well-versed in the upcoming competition, and capable of responding swiftly and precisely to potential competitor action.

Download the white paper  to understand how we helped the client develop a competitive strategy to defend its market position and create a roadmap that would ensure its long-term viability through digital reinvention.

Raj Rajgopal

Raj Rajgopal is the President of Virtusa Corporation, and leads Virtusa’s Digital Business strategy and execution capabilities. Raj leads a team of digital strategy consultants who help our clients develop and execute disruptive and differentiated value propositions that enable them to take a leadership role in their industries. Raj joined Virtusa Corporation in April 2005. He has served as the President of Virtusa Corporation since 2013. In this role, he was responsible for developing and executing Virtusa’s growth strategy. With the acquisition of Polaris Corporation in 2016, Raj took on the leadership for the Enterprise Technology & Solutions group. This group is a global unit comprised of Healthcare, Insurance, Life sciences, Communications, Media, Information, Entertainment & Diversified industries. Between 2008 and 2013, he was the Executive Vice President for business development and client services and served as General Manager of the Communications, Content & Technology business unit between 2005 and 2008. Raj graduated from the Indian Institute of Technology with a B.S. in Mechanical Engineering; earned his M.S. in Industrial Engineering and Operations Research, and in Computer Science from Virginia Tech; and earned his Master's in Business Administration from Massachusetts Institute of Technology (M.I.T.), Sloan School of Management.

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