A look at digital transformation through the eyes of a game theory.
There are two kinds of games. An infinite game and a finite game.
A finite game has fixed rules and the players are constant. The game has a very clear start and ending point. Most of the games we play are finite. Soccer, baseball, ‘Wheel Of Fortune’ and board games are finite. These games promote short-term thinking. If you are Playing a finite game you are playing a game that satisfies your interests.
An infinite game, on the other hand, is much different. In an infinite game, the players are not constant, there is no agreed-upon objective and no clear ending point. The only way you can lose an infinite game is to either quit or run out of resources. An infinite game is a game of survival. If you are playing an infinite game you are playing to satisfy your values. (survival is a core value)
The system has stability when players understand what type of game they are playing, and all decide to play by the rules. Instability arises when you have an infinite gamer playing a finite game.
We see this all the time in business when a company comes out of nowhere and disrupts the industry.
These companies march to their own beat, they are sources of frustration and envy to other businesses who have to run just to keep up. Companies like Apple or Tesla are a good example of what happens when an infinite business plays against finite business.
So how can you cross over into the infinite game?
It comes down to values and interests.
Most companies make their decisions to satisfy interests. For example, your company loses a vendor or wholesale supplier and needs to find another. You have to make a decision to satisfy an immediate need. Most organizations make these decisions without regard for the companies values. They make decisions to satisfy immediate interests and before you know it, a company will have so many contradicting decisions, it no longer knows who, or what it is. This is how companies lose their way. (This is what happened to Apple in the 90’s after they fired Steve Jobs. Apple lost its way.)
The infinite company makes its decisions starting with its values, then it makes decisions to satisfy interest that are in line with its core values, they don’t contradict the values of the company.
Values are infinite and interests are finite.
A digital transformation, as we have discussed, is really about rethinking your business from the ground up. When planning for the future of your company you will need to make decisions that allow you to stay in the game.
I simplify Digital Transformation. Before we begin that process, even before we envision what a post digital-transformation version of your company looks like, let’s examine your values first. Once we have a crystal clear understanding of your values, then we can make decisions about your interests.
Your digital transformation will be successful if you are able to pivot into the infinite when you stop making finite decisions…and the beat goes on.
Let’s talk about it
Has your company lost its ways? Does it have clear values and how well does it stick to those values? Are they leading the ship or just kinda, kicked under the rug?
The New IT
** Based off a talk given by Simon Sinek at Ted Talks**