The infinite game
In finite games, the players are known. They are based on set rules and there is an agreed goal. If it is achieved, a finite game is over. Soccer is an example of such a finite game. The players all wear the same thing and are easily recognizable. There are certain rules and referees who monitor compliance with these rules. The players have agreed to play according to these rules and to accept the penalties imposed if they are violated. Everyone agrees: the team that has more points at the end of the specified period will be declared the winner. Then it's game over and everyone goes home. In finite games there is always a beginning, a middle part and an end.
Infinite games, on the other hand, are played by known and unknown players. There are no precise or agreed rules. There may be conventions or laws that regulate how players behave, but within these broad limits they can do what they want. And they can also violate such conventions. How a single player plays is entirely up to him. And every player can change their style of play at any time for any reason. Infinite games run with no time limit. And because there is no finish line, no clear end to the game, you can't "win" such an infinite game. The main goal of such a game is to stay in the game - forever.
Win and lose
What I know about these two types of games I learned from the master of the trade - from Professor James P. Carse, who wrote Finite and Infinite Games: A Vision of Life as Play and Possibility in 1986. Carse's book made me think beyond winning and losing for the first time - and also about draws and stalemates. The closer I looked at the world through Carse's lens of finite and infinite games, the more clearly I saw the many infinite games going on around us - games with no finish lines and no winners. For example, no one can be first in a marriage or friendship. School time is unquestionably finite, but you cannot win in education. In the Casting We can beat competitors for a job or a promotion, but nobody is crowned a winner in the profession. Countries around the world can compete with other countries for land, influence, or economic advantage, but there is no winner in world politics. No matter how successful we are in our lives, when we die, none of us will be declared life winners. All of these examples are developments, not events.
But if we hear what so many of our leading figures are saying today, the impression arises that they are not clear what kind of game they are playing. You keep talking about "winning". They are obsessed with "knocking out the competition". They trumpet into the world that they are »the best«. Unfortunately, none of this is possible in games without a finish line. Anyone who competes in an infinite game with a finite attitude will cause all kinds of problems - above all a decline in trust, a spirit of cooperation and innovation. If you, on the other hand, go into an infinite game with the right mentality, you effectively correct our course. People with such a basic attitude are shown far more trust, willingness to cooperate and innovative dynamics - including all the advantages that result from it. Since we are all drawn into endless games over and over again, it is in our own best interest to be aware of the game we are playing and to see what makes a leader with the right mindset. But it is just as important for us to perceive the signs of finite thinking so that we can take corrective action before greater damage occurs.
The infinite game of economics
The economy is by definition an infinite game. Not all players are always known and new ones can be added at any time. All players determine their strategies and tactics themselves. There are no set rules that everyone subscribes to - apart from the applicable law (and even that can differ from country to country). In contrast to a finite game, there is no predetermined beginning, no middle and no end of the economy. Although many of us count on the evaluation of our own performance in comparison to other players in certain periods of time - for example in financial years - these are only markers in the course of the game and in no way mark the end of the actual game. There is no finish line in business.
Companies compete in a game that is impossible to win. Yet too many business leaders behave as if this were possible. They still claim to be the "best" or "number one". Such claims have become so common that we hardly realize how ridiculous some of them are. As soon as a company claims to be number one or the best, I always take a look at the small print and see which raisins it has picked from the key figures for this purpose. For example, British Airways boasted in its advertising for years that it was the "most popular airline in the world".
Who is No. 1? A matter of definition
Richard Branson's rival Virgin Atlantic, however, filed a complaint with the British advertising regulator: on the basis of the latest passenger surveys, this could not be true. However, the agency allowed British Airways to continue to claim so. The reason: They carry more international passengers than any other airline. The attribute "most popular" is used by British Airways to mean that their business is growing - not necessarily in the sense of "preferred". A company might think of itself as number one because it has so many customers. Another could refer to sales, share price development, number of employees or number of branches worldwide. Companies that make such full-bodied claims can even determine for themselves the time frame for which they make their calculations: for a quarter, for eight months or for a year. Or for five years - or a dozen. But do all industry players agree with the period in question as a basis for comparison? In finite games there is one agreed key figure that distinguishes between winners and losers - goals scored, speed or strength. There are many different metrics in infinite games, so we can never determine a clear winner.
A finite game is over when the allotted time is up. The player can then start again on a different day (unless the game was a duel). In an infinite game it's very different. The game continues as the players time runs out. Because you can't win or lose an infinite game, players simply drop out when they're tired or when they run out of funds. In business this is called bankruptcy or merger or takeover. The following applies: Those who want to be successful in the endless game of business must no longer think about who wins or who is the best. Instead, it needs to focus on how to build organizations that are strong, solid and capable of staying in the game for generations to come. Irony of fate: the advantages that this brings often strengthen companies in the short term.
A story of two players
A few years ago, I was invited as a speaker from Microsoft to a top conference on education. A few months later, I performed the same role at Apple. At the Microsoft event, most of the speakers' presentations centered around how they wanted to overtake Apple. At the Apple event, 100 percent of the speakers devoted 100 percent of their time to how Apple could teach teachers and help students learn. Some seemed obsessed with the idea of knocking out a competitor, others were inspired by the matter.
After my presentation at Microsoft, I received a gift - the Zune (when it was still a device). It was Microsoft's answer to Apple's iPod - the dominant factor in the MP3 player market at the time. Microsoft didn't want to be left behind and introduced the Zune to steal market share from its arch rival. That was in 2006, and then Microsoft CEO Steve Ballmer was confident that sooner or later Microsoft could "beat" Apple - although he knew that it would not be easy.3 If only product quality had been important Ballmer's optimism was justified. The version of the Zune that Microsoft presented to me - the Zune HD - was, I have to admit, really excellent. The design was elegant, the user interface simple, intuitive and user-friendly. I really liked the Zune. (For the sake of completeness: I gave the device to a friend as a gift for the simple reason that, unlike my iPod, which was compatible with Microsoft Windows, it couldn't use iTunes. As much as I wanted to use the device - it was me simply not possible.)
After my appearance at the Apple conference, I shared a taxi with a top Apple manager on the way back to the hotel - the one with personnel number 54, to be precise. That meant he'd been there from the start and at home in the Apple culture and mentality. As we sat together in the taxi and I was sure of his attention, I couldn't help teasing a little. So I said to him, "You know ... I spoke to Microsoft recently and got the new Zune there, and I have to tell you, it's LOTS BETTER than your iPod touch." The Apple man looked at me, smiled, and said: "I'm sure you're right." That was all. That was the end of the subject.
The advantages of the right attitude: The arrogance of the market leader
The fact that Microsoft had the better product left the AppleManager absolutely indifferent. Perhaps the arrogance of the market leader spoke from him. Maybe he played something for me (but then really well). Or maybe it was quite different. I wasn't aware of that at the time, but his answer was exactly that of a manager with the right mentality for infinity.
In the Infinite Game, an organization's true worth is not measured by its success on a set of arbitrary metrics for arbitrary periods of time. Rather, the real value of an organization is judged by how committed others are to contributing to the organization's ability to continue to thrive - not just during their term in office but well beyond. A manager with a mentality trimmed to the finite works to get more out of employees, customers and shareholders and thereby fulfill arbitrary requirements. A manager who thinks ahead, on the other hand, is vigorously committed to encouraging employees, customers and shareholders to continue to contribute through their efforts, their money and their investments. Actors who play on infinity want their organizations to be in better shape than they found them. Lego invented toys that have proven themselves over the long term. But that wasn't a happy coincidence. Rather, the success of Lego is based on the fact that almost everyone who works for the company wants to help ensure that the company survives them. The Lego people are not guided by the idea of doing better in a quarterly comparison, but rather want to »continue to develop innovative gaming experiences and reach more children every year«.
According to Carse, a corporate leader with finite mindset plays to end the game - to win. But if one wants to win, another has to lose. Such players play for themselves and want to defeat other players. In all of their plans and actions, the thought of victory is paramount. They almost always believe they have to act like this, even though it is not at all. There is no rule that tells them to. They are driven by their mentality. Carses, on the other hand, play infinity-oriented players to stay in the game. In business that means building an organization that can outlive its rulers. Carse also assumes that such actors act for the benefit of the game. In business this is synonymous with a vision that goes beyond the operating result. While a finite-oriented player creates products that he believes will sell well, the longer-term oriented player produces what people want to buy. One focuses primarily on how the company benefits from product sales, the other on what the buyers get from the products.
Standards or performance - what are we based on?
Players who are finally orientated generally follow standards that help them to achieve their personal goals - regardless of the after-effects that this can trigger. The question "What is the best for me?" Testifies to finite thinking. On the other hand, it is about infinity when asked: "What is best for us?" A company designed for the infinite game never thinks only of itself. It takes into account the impact of its decisions on its workforce, society, the economy, the country and the world at large. It acts for the good of the game. Kodak founder George Eastman lived for his vision of making photography easy and making it possible for everyone. He also realized that making this vision a reality was closely tied to the well-being of his employees and the community in which they lived. In 1912, Kodak became the first company to pay its employees on a dividend-based basis.
A few years later, Kodak issued what we now call stock options. Employees also received generous fringe benefits, sick pay (a completely new concept at the time), and training grants if they wanted to takeCourses at local colleges. (All of this was later copied by many other companies. So you could say it was good not just for Kodak, but for the entire business game.) Kodak didn't create tens of thousands of jobs; Eastman also built a hospital, founded a music school, and supported generous further education institutions such as the Mechanics Institute of Rochester (later renamed the Rochester Institute of Technology) and the University of Rochester.
Fear of surprise or the big vision in focus?
According to Carse, players who are geared towards finiteness have an aversion to surprises and fear any disruption because they are playing towards an end point. What they cannot forecast or control could torpedo their plans and reduce their chances of winning. A player who is interested in infinity, on the other hand, expects surprises, yes, even welcomes them, and is ready to be fundamentally changed by them. He enjoys the freedom of the game and is open to all ways to stay in the game. Instead of looking for ways to react to what has already happened, he looks for opportunities to try something completely new.
An infinite perspective frees us from being fixated on what other companies are doing so we can focus on an overarching vision. Instead of reacting to how new technologies call our business model into question, more forward-thinking top managers are better able to foresee the possible applications of new technologies. From this point of view, it is understandable why the Apple manager, with whom I was sitting in the taxi at the time, was not upset by the well-designed Microsoft product Zune. It was clear to him that in the never-ending game of the economy, Apple would sometimes push ahead with the better product and sometimes a competitor.
How to outdo yourself
It wasn't about outperforming Microsoft. Rather, Apple was looking for ways to outdo yourself. The company was already thinking about what would come after the iPod. Thanks to Apple's infinity-oriented mentality, its employees were not only able to think in different ways, but also long-term. Around a year after the Zune was launched, Apple introduced the first iPhone. In doing so, it redefined the entire category of smartphones. The Zune and the iPod were practically obsolete. While some believe it, Apple could not predict consumer preferences or see into the future. In reality, it was the company's infinite perspective that gave it the ability to innovate that is simply not possible for companies with leadership that is more finite.
A company focused on finite goals can come up with "innovative" ways of increasing profits, but such decisions usually do not benefit the organization, employees, customers and society - only profit. And they don't necessarily set up the organization better for the future either - for a very simple reason: because such decisions are primarily beneficial for those who made them and did not think of infinity, but only of the near future . Far-sighted executives do not urge their people to fixate on finite goals, but rather encourage them to encourage an endless vision of the future that benefits all involved. The finite goals then only become milestones for the implementation of this vision.
Innovative strength beats stability
If everyone aligns themselves with this infinite vision, it not only leads to innovation, but also drives the numbers up. In fact, companies whose leadership teams have such a mentality can often boast record profits. But that's not all. The inspiration, innovation, willingness to cooperate, brand loyalty and profit development, which result from a leadership geared towards infinity, not only serve companies well in stable phases, but also when the going gets tough. What helps a company survive and thrive in good times makes it strong and resilient in bad times. A company built for resilience is built to last. This is where it differs from a stability-oriented company. By definition, stability is about keeping everything as it is. A stable organization can theoretically defy a storm and in the end it emerges unchanged. In practice, the attribute »stable« is usually intended to emphasize that a company differs from a risky and more efficient company. “It grows slowly, but it is solid,” is the common perception.
But a company that was designed from the outset for stability has not understood what the infinite game is actually about, because it is hardly prepared for the unpredictable - for new technologies, new competitors, market changes or global events that change its strategy from now on can throw the web. A corporate leader aiming for infinity doesn't just want to build a company that can cope with change - but one that can be transformed by it. He wants to build a company that welcomes surprises and adapts. Resilient companies sometimes emerge completely transformed from upheavals (and are often even grateful for that).
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German edition: ISBN 9783965965164
English version: ISBN 9783965965171 (Translation notice)
German edition: ISBN 9783965965164
English version: ISBN 9783965965171 (Translation notice)
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