What's Your Power Serve?

Serving To Win

Which of these statements resonates more with you?

1. I try to win, because losing sucks.

2. I try to serve my clients, because then I win too.

3. I try to serve my clients, which generally works out best for me as well.

If you chose #1, OK, I get it, I like competing as much as the next guy, but come back another time, we’re not talking to you today.

Today we’re talking about service, winning, and the link between them.

Do you serve to win? Does serving cause winning? Or is winning an occasional byproduct of serving?

What it comes down to is: Why are you serving?

Does Doing Good Cause Doing Well?

There’s a myth being perpetuated by well-intended, wishful-thinking, creative, holistic people out there: the myth that if you do right, you absolutely will do well.

In its more extreme forms, this belief would suggest that all highly ethical and socially responsible companies always make more money, every quarter.

Of course, there’s no shortage of cynical, embittered, hard-bitten “realists” who just can’t wait to whump the idealists upside the head with a good “oh-yeah-take-Bernie-Madoff” or two.

Who’s right?

Prisoner’s Dilemma

Social scientists and game theorists are enamored of The Prisoner’s Dilemma, a two-person game about cooperation and competition. In each game, each player can choose to cooperate or compete.

  • If one chooses to cooperate and the other to compete, the cooperator gets 10 years in prison, while the competitor goes free.
  • If they each choose to compete, they each get 5 years in prison.
  • If they each choose to cooperate, they each get 6 months in prison.

The person economists assume we all are—rational maximizer of self-interest—will rationally choose to compete. So will his competitor. Boom.

That approach sums up approach number 1—play to win. Turns out that businesspeople in controlled tests of prisoner’s dilemma strongly favor approach number one; it fits with what they learned in business school, be number 1 or 2 in your market, competitive advantage, etc.

In a connected world: boom. So much for statement number 1 at the outset of this post. Because in the real world, prisoner’s dilemma doesn’t just get played once.

Playing the Game More than Once

Part of the “trick” of prisoner’s dilemma is to play it more than once. Over time, the optimal strategy turns out to be “tit for tat,” i.e. assume the other party will cooperate, and do likewise. This generally ends up in iterative decisions to cooperate, with only occasional breakdowns of order.

But why do people continue to choose “cooperate?” Is it because the economists are right, and we’re all rational maximizers of self-interest who look at the long run? Do we calculate the odds and figure that the net present value of cooperating is greater than that of competing? Turns out it’s a little murkier than that.

Playing the Game With More Than One Player

In addition to frequency, the game is affected by participation. If there are high levels of information, visibility and interaction about how other players are engaging in the same game, then the cooperation strategy becomes even more dominant. There are fewer defectors from the cooperative strategy trying to squeeze in that last little bit of competitive edge.

Fewer Madoffs.

But: if you have more people choosing to tweak those odds, looking for just the right moment to sucker-punch the other guy after having lulled them into somnolence by a series of apparently cooperative gestures, looking to gain that final advantage—then the system starts to fall apart.

Why We Play the Game Matters

Prisoner’s dilemma is a pretty good metaphor for life. The economists’ fiction of individual actors is just that—a fiction. Francis Fukuyama puts it this way in The Origins of Political Order:

It is in fact individualism and not sociability that developed over the course of human history. That individualism seems today like a solid core of our economic and political behavior is only because we have developed institutions that override our more naturally communal instincts. Aristotle was more correct…when he said that human beings were political by nature.

The only serious debate is between statements two and three. Do you cooperate to win? Or do you cooperate because—that’s what you do? It’s the latter attitude, held by enough people over a long enough time period, that drives economic wealth.

  • A business strategist who advises any given company to be socially responsible because they’ll make more money that way is detracting, not contributing, to social responsibility;
  • An investor looking for socially responsible companies solely in order to make more money on their investment is a risk-seeking investor;
  • A society of people who cooperate “in order to win” is in trouble.

The Paradox of Trust

Belief number two—serving your clients because that way you win—is ultimately self-defeating. Because if “to win” is your ultimate goal, you’ll sooner or later end up facing a situation where you have to choose between serving and winning. And you’ll choose winning.

And then people will stop trusting you. And that disease is communicable.

Two variables make it all work: time, and numbers. Play the game enough times, with enough players, and it works. Where it goes wrong is when we:

  • Start managing to quarterly earnings
  • Start analyzing performance metrics in the short term
  • Analyze individual psychology outside of group psychology
  • Use the language of self-interest instead of group interest.

The paradox is: economics work if we justify it ethically. But if we try to justify ethics economically, it all falls apart. Beware of those who justify ethical behavior by the bottom lines.

Answer three—serve your clients because things generally work out better that way—is the “right” answer for all of us. If we remember to keep it long-term, and keep it social, then it works.

  • http://www.ianbrodie.com Ian Brodie

    As thought provoking as ever Mr Green!

    I suppose the ultimate question for people to answer is whether they serve, even though they know it will make them lose. An example might be if they recommend to a client that they use someone else better qualified for a piece of work (where there’s no possibility of reciprocation or getting more work in the long run).

    I had an interesting and related experience on my blog a while back. I posted a story of how I saw an assistant in our local post office giving great service to to a little old lady. Chatting with her, looking at her photos, etc.

    My point in the post (“Beyond customer service”) was that it’s good to be nice to our fellow human beings – even if there’s no payback. In this case there was really no chance that that the post office would get more business as a result of the act of kindness.

    The vast majority of the comments I got on the blog and on twitter just couldn’t seem to accept this. So many people just seemed to want to believe that somehow it would pay back. That the little old lady would “spread the word”. or that I and the others who’d witnessed it would spend more as a result (I’ve checked: I haven’t been in there and bought more stamps than I needed just to reward them yet).

    It was really interesting that we’ve been so conditioned into “if you do good you’ll get rewarded in the long term” thinking that it feels wrong if a good deed doesn’t get rewarded. We almost fabricate obscure ways in which these good deeds could get paid back. I catch myself thinking like this often.

    I suppose it’s maybe as well that this is the case – so that less altruistic folks are conditioned into behaving well in the hope of future reward. But really, we should be doign good because it’s right – not because we get rewarded for it.

    Ian

  • http://www.johngies.com John Gies

    Charlie,

    Thank you for making me think more about this. I am in the camp that says if you do good you will be rewarded. This is not easy and it is not for those that are interested in the short term.

    I have come to the belief (and it goes against all I was taught in school) that when you behave ethically, you will be rewarded. Maybe not in a quid pro quo fashion, but you will be rewarded. At the very least you will be able to shave in the morning without slitting your own throat.

    Doing good is its own reward. I have found that if you deliver good work, have the right intentions, keep the faith and are willing to adapt good things will come back to you. And I believe that where possible individuals seek to do business with people that are out to do good and that have the right intentions.

    It is as you state, a paradox. When we all agree that cooperation is good and we cooperate wealth is created. When we choose to win at any cost society and the underpinnings break down.

    Thanks again

  • barbara garabedian

    Charlie , I believe the last sentence is a mouthful, “…if you remember to keep it long-term”. Isn’t that the antithesis of the American business standard and Business School mentality today? I’m not sure people know how to relate to that concept. Long-term … what is that today, 2 quarters?
    I’m with Ian, doing good is just the right thing to do and not because we can get rewarded for it. Although I must admit, the positive “jolt” I get from it probably categorizes me as a reward seeker.

  • http://www.spiritheart.net peter vajda

    Barbara, your comment resonates with me, “…doing good is just the right thing to do and not because we can get rewarded for it. Although I must admit, the positive “jolt” I get from it probably categorizes me as a reward seeker.”

    Truth be told, my take is a vast majority of folks, in business, live in the category of “giving to get.” I think it’s hardwired into many folks’ brains and nervous systems; learned behavior. I also think there are those whose mantra is “no good deed goes unpunished…” – that somewhere along the way their doing good has backfired on them in some way, shape or form, so unfreezing their outlook and learning a new one is challenging. For them, serving has resulted in a double-fault, hard to overcome.

  • Barbara Garabedian

    Peter,I agree. It is challenging to re-learn, especially when there will always be situations where “no good deed goes unpunished” to reinforce that thinking.
    To continue w/ the tennis analogy, double faulting is hard to overcome. Although it can be overcome by re-focusing on the “basics & fundamentals of your game”. Forget the forward thinking to the end game and/or the past mistakes, just stay in the moment and “keep your eye on the ball”. Trite but effective.

  • http://www.trustedadvisor.com/trustmatters Charlie

    Wow, is it really that bad? I mean, I think I’m kind of skeptical but jeez, starting with Ian’s readers not wanting to believe the ‘help the old lady’ scenario, and Peter and Barbara, you’re both upbeat people, but wow, y’all are telling me that things are worse than I thought out there. Or maybe I’m just naive.

    I’m not sure what to think, except Barbara gets the weekly first prize for working-the-tail-off-the-metaphor!

  • http://www.chrisdowning.co.uk Chris Downing

    Ah ha! Now this is a really insightful test about whether your motives are purely about relationships and society getting along better, or doing things for an ultimate return later. It’s the difference between real giving and ‘trading’ or ‘lending’ good deeds.

    In real giving you don’t expect anything back, it just feels like the right thing to do. If you are giving and expecting the favour to be returned, you are really trading – and later on you will be asking that person for the return favour – at which point the relationship fractures. If we feel in our gut that we are being given something for an ultimate pay-off, all relationship building stalls.

    This attitude of giving or trading is at the very heart of ‘Trusting Relationships’. If you want to be working in an environment of trust, mutual support, and respect, you need to accept that giving is really giving and not a loan or an investment.

    Personally, I’ve had nobody take advantage of me when the relationship was good – people you trust just don’t do that to you. But I have been disappointed in people I have know less well and their attitude to my giving them help. Many thought I was just a soft touch; they took full advantage. But that attitude says a lot about how their business life is dysfunctional – it isn’t a comment about me. (I read that somewhere and it partly lessens the feeling you’ve just been ‘had’ by a business crook.)

    But what the hell, I like to play the open game where you sometimes suffer a turn-over. The open game is much more fun – and the fans love it. I like playful business – why shouldn’t business be fun and enjoyable? You can’t steal what I’d give you – so I’ don’t have to worry about this issue.

  • http://www.spiritheart.net peter vajda

    “Wow, is it really that bad?…that things are worse than I thought out there?”(Charlie)

    Charlie, I think there are flavors of the giving to get behavior. Yes, there are the psychopaths and Machiavellian give-to-get types who might fall into the “is it really that bad?” category.

    On the other end of the continuum, however, are those (and their numbers are high) who truly want to be giving, have good intentions but come from a place of feeling lacking, deficient and fearful. 99% of this individual is giving from the heart, but 1% is grasping their hands and hoping and praying their giving will pay off with some type of return.

    These are folks for whom trust is a challenge – trust in themselves, trust in the Universe and trust in relationships. These folks are kind, caring, well-meaning and the like. It’s just that very early somewhere along the line they discovered that trust wasn’t a two-way street and when they trusted they experienced some type of rejection or betrayal.

    And it’s the conscious or unconscious fear of “no return” that leaks out when they want to be giving. They’re not “bad” or “wrong.” They just need to work on the trust issue so they can give, take a deep breath and let it go, with no psycho-emotional quid-pro-quo. When they have a deeper sense of self-worth and self-value they won’t have this need for “validation” that comes from the “getting.”

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