Moving beyond zero-sum thinking


John Hagel has a very interesting piece on zero-sum thinking – the idea that there if one person wins, another must lose. He draws out how this is epidemic in the business world. A great example is how companies treat their suppliers. In what way do companies do better if their suppliers suffer? Yet that seems to be how many suppliers are managed today, in squeezing them as much as possible. The trick is to move beyond the single dimension of price. Once you do that, there are unlimited ways to create value for both parties. Yet there are far more ways that the implicit assumption of a zero-sum world drives business strategy. Intellectual property and organizational design are just two examples. The vast majority of value creation in the economy today is collaborative, with more than one winner. Executives must actively seek “non-zero-sum” games, in which you can collectively increase the pool of value available. This shift in mentality is in fact required for survival. Zero-sum thinkers and players will find business swiftly becoming more difficult. If you’d like to learn more about zero-sum thinking and how to transcend it, read the great book Nonzero, by Robert Wright.