How can we apply game theory in today’s society, workplace or even in our everyday lives?
An idea, program, project or initiative begins positively, with an initial burst of energy, excitement and enthusiasm. Business leaders, change managers, communication teams, and change champions, are excited and invigorated to propel the organization towards a transformative goal. However, when this initial burst dies down, people and systems return to business as usual — often reverting to old behaviors, and the transformation initiative runs the risk of extreme failure.
Design thinkers are encouraged to build what Roger L. Martin called “knowledge systems” by exposing themselves to a variety of stimulus — not only to learn, but to make connections, inspire, and apply. This is important because it sets the conditions for innovation. Steven Johnson’s Where Good Ideas Come From specifically calls out exaptation (taking inspiration from one area and applying it to another) and collision (magic that comes from bringing different perspectives/expertise together), perfectly summing it up with “chance favors the connected mind.” This becomes second nature with practice. With a bunch of small antennae constantly pinging, we find ourselves synthesizing new bits of knowledge all the time. Revelations amusingly present themselves in the most unexpected ways.
What does game theory have to do with culture? More than one expects.
Culture happens no matter what. If you don’t leverage it as an asset, it will deteriorate to a liability. How do certain change programs make it and achieve a sustainable high performance level of engagement while others drop way to the ground?
The answer may be seeded in how one envisions success and how the game theory is positioned in the system.
Game theory — in simple terms, the study of how and why people make decisions — describes two types of games: finite and infinite games.
Finite games are where the goal is absolutely clear, the players are known and the rules are pre-determined. Baseball, soccer and hockey are finite games: The rules are pre-determined and the goal is clear: to win.
On the other hand, in infinite games, there are no set rules. The rules may change, the boundaries may change, and even the players may change. There is only one goal: participants in the infinite game simply want to keep the game going.
One clear example of an infinite game is business. Individual businesses may come and go, but the game of business continues.
How can an organization or person play it right?
When finite players play an infinite game, the result is inevitable — they lose. This was the observation made by business thinker and author Simon Sinek in a recent Google Talk called Finite and Infinite Games of Leadership.
Simon Sinek uses the Vietnam War as an example. In the war, the US was fighting to win. On the other hand, North Vietnam and the Viet Cong were fighting to survive. For the Vietnamese, losing was not an option. The finite player, in this case the US, invested resources and energies to defeat the opponent. But the opponent was not focused on defeating the USA. As a result, the finite player was frustrated, ran out of patience or resources and eventually left the game.
Simon Sinek also links game theory to organizational behavior. Microsoft and Apple present a stark contrast between finite and infinite players. At Microsoft, the main motivation of the executives was on beating the competition. By contrast, at Apple, all of the executives spent their time on fulfilling the company’s vision which was to ‘make great products’.
Apple’s vision in the strictest sense is never fully achievable — what is great today, may be commonplace tomorrow. This is why executives at Apple constantly think ahead, innovate and improve their products. They pay less attention to what others are trying to do and more on what their customers want.
Players who view the game as a finite one, instead focus on what the competition is doing. Just like the USA in the Vietnam War, they may get frustrated and exit the game. Apple seeks to keep the game going — this is part of the reason why Apple has been able to continually develop products that do well in the market and outlast the competition.
Workplaces today face a multitude of pressures, including a mobile multi-generational workforce, technology-led disruption and continuous innovation. The gap between the future and the present is rapidly shrinking. As such, designing a workplace strategy that meets only short-term goals may quickly become obsolete.
Applying the concepts of game theory to envisioning workplace programs could be the missing ingredient to long-term success.
Here are four ideas to consider when trying to play the game right:
1. Start with Your Purpose
“Achieve a real estate cost reduction of 20% per annum”. A workplace objective like this meets with the law of diminishing returns. Workplaces designed, with this objective in mind, will run stale. A highly cost-efficient workplace may save you money in the short term but if it hurts engagement levels, it is likely to have a much higher hidden cost — attrition.
Think Infinite: Instead of focusing on cutting costs, switch the narrative around. Take a look at a workplace vision such as this one: “create work environments that inspire people to do great work”. The vision for your workplace should be defined by your people, rather than by what your organization wants to cut back on.
2. Be True to Your Unique Culture
Understanding how your competitors or peers in the industry develop and design their workplaces is helpful, but only up to a point. A potential risk of going down this path is becoming obsessed with the competition — something a finite player may do. For example, many organizations replicated Google’s unique workplace settings, in a bid to mirror Google’s success. They are now questioning the value of these spaces, and are finding out that what worked for Google may not work for them.
Think Infinite: Google’s unorthodox workplaces is an outcome of their unorthodox thinking, not the other way around. Google’s vision is “to create the happiest, most productive workplace in the world”. This exemplifies the importance Google places on its people. Your workplace vision needs to reflect your unique culture.
3. Adapt to Changing Needs
Evolving your strategy is part of the infinite game. The environments people work in will be influenced by the nature of their work, the technology they use, the local realities of operating a business and the country’s socio-political culture. These vary according to each workplace’s unique situation and are not a constant. Workplace requirements therefore constantly change. A finite player defines a workplace vision but fails to adapt to changing needs.
Think Infinite: Workplaces need to evolve to survive. Organizations should review whether their workplaces continue to deliver on and reflect their vision. Refreshing your workplace program to keep updated with current trends will keep your workplace relevant.
4. Create a Framework for Success
Finite rules are unlikely to succeed in a work environment that is constantly changing. Highly prescriptive workplace guidelines do not allow for flexibility, as they fail to include the local context and culture in implementation. With no room for interpretation, local leaders will likely create work environments that do not support business adequately and are not sustainable.
Think Infinite: Successful organizations create flexible frameworks. Without the restrictions of prescriptive guidelines, these structures provide enough room for your local leaders to interpret your organization’s broader workplace vision in the relevant economic and cultural contexts.
Some doors may open, some may shut, but the focus to unlock workplace success is by being positioned in a workplace that allows you to play the game right.
Game theory provides incredibly powerful insights into organizational behavior. The lessons are clear: Be sure to understand what game you are playing. Playing it wrong will result in frustration; getting it right will allow you to maximize your chances of success in an infinite number of ways.
People aren’t machines that respond to the press of a button. Knowing and planning for what happens, when, and how must be strategic and informed by human-centered design.
It’s not always about winning all the time, every day. Sometimes it’s simply the opportunity to continue to build an awesome company and or team and yourself. Many organizations and their leaders forget that they primarily exist because of two things: their customers and their employees. If either leaves en masse, there’s no more business. Look to the “has been” companies taken down by their toxic cultures for proof. Culture touches, and therefore connects everything. An organization must decide if culture will make or break them.
There’s so much more to be learned — and exapted — from game theory for the benefit of culture building, employee experiences and evening making decisions in your own daily life. But remember that complex human beings can’t be boiled down to mathematical probabilities and they certainly aren’t always predictable or rational. Like Jeopardy champions, game theory only works if the skills and knowledge are there to back it up. Developing culture-building capabilities, employee engagement, and leadership at all levels will help. Think infinite.