By David Onjili
The choice for organizations to stay relevant to the needs of its business existence and true to its founding values remains a challenge. In a fast-changing environment disrupted by technology and a workforce whose needs are dynamic breeds interesting propositions for its managers and founders.
Interestingly, organizations that have continued to be at the very top in terms of profit and growth have exemplified certain core values worth emulating.
Game Theory is a branch of mathematics that uses elements of economics and sociology to better understand rational decision-making in competitive situations. Organizations by their existence are in competition with each other for the scarce resources in their particular fields. Thus, having a marked out strategy is like a sextant to a ship deep in the ocean.
It is thus imperative that managers buy into the values of an organization and hold onto them. Managers on the other hand, must at times go against the interests of an organization to build structures for long-term success ignoring temporary glory.
Author John Devine depicts the period between 2004-2007 in Manchester United Football Club as a perfect example. Their dominance of English football was checked by Chelsea Football Club, and in that period they failed to win the league title. Rather than splash big money on big players, Fergusson went with faith in youth and trusted a group that consisted of Wayne Rooney and Cristiano Ronaldo.
Organizations and especially managers can glean so much into this strategy; rather than poach for expensive talents across organizations in the same field. Why not believe in a group of staff with potential to rise and mentor them? There is always a cycle trap managers fall into, hiring and paying over the top for new staff who are viewed as ‘miracle workers’, interestingly in many cases it does not work out. The upside of promoting from within is that they mostly are sold out to the values and culture of the organization. While this may sound capitalistic, they will also not demand astronomical salaries and wages, as you would get, were you to poach from a competitor.
As Simon Sinek, a British American author, motivational speaker, and organizational consultant points out, there are finite and infinite games in game theory as long as there is more than one competitor. Finite games have known players, fixed rules and known objectives like a game of football. Meanwhile, infinite games have both known and unknown players; yet the objective of the game is not to win but to perpetuate the game to eternity; keep playing for as long as possible; sustain a business for generations to come.
To put the above into business context, if we have two organizations that we shall call x and y. Assuming that both are in the same field, say telecommunications, if Organization x has its objective in changing lives i.e. investing in education, clean water and doing better than itself each year… it is playing an infinite game. Whereas, if Organization y has its objective in being the best i.e. beating Organization x, then according to Sinek this is a case where game theory is clear. While the finite player will be playing to win, the infinite player will be playing to keep in the game and eventually it is the latter that prevails. The objective is to play forever and not play to win, legacy in mind.
A perfect case scenario is a battle between tech giants Apple and Microsoft. The former is intent on changing lives and leaving a mark while the latter is in the game to outdo Apple. While both companies produce amazing products, Apple continues to be the market leader and sets the bar yet they are playing an infinite game unlike most of her competitors.
In hindsight, game theory teaches us that management needs a commitment to organizational core values and not be reactionary. Spending big to plug holes in an organization is not the remedy. Each organization and its managers must define what success means to them. Managers must understand that in their fields, they may not always be the most innovative or creative always but as long as they inspire those within the organizations to do better daily than they did previously then objectives are met.
The Japanese have their Kaizen; this simply means that you continuously improve. They never set out to compete any one but themselves. It is an infinite contest from within. How many times have we seen organizations that were once ‘market leaders’ in their field e.g. Nakumatt and Uchumi chain of supermarkets go under? The secret according to Sinek is in game theory’s infinite and finite games.
Is it not interesting that Alex Fergusson of Manchester United is hailed for his success at the club? It was all down to him understanding that his team may not win the league each season, but they can remain competitive and amongst the best. Interestingly, that generation of those he had faith in went on to be treble winners in 1999 by grabbing the European Champions League, The FA Cup, and the Barclays Premier League.
So as a manager, what game are you playing, finite or infinite.