Long-Term Iterated Games

“The longer view you take, the more apparent it becomes that people who are seemingly competing with each other are actually collaborators.” – Visakan Veerasamy

Iterated games become very counterintuitive once you zoom out and consider time scales of a decade or more. For example, over long enough time frames, your competitors are also your collaborators. You still compete for a share of the pie, but you also work together to grow the pie.

As a personal anecdote, I began my career as an author believing that other authors were my competitors. That is true over short time frames, such as when considering “What book will that reader buy next, mine or theirs?” However, over longer time frames, it’s more about, “How can my competitors and I educate readers about the value of our niche, so that they buy both my book and theirs?”

As another anecdote, I began my career as a consultant believing that a competitor’s failure on a project was good for me, since their client might fire them and hire me instead. Later on, I understood that a competitor’s failed project also lowers the perceived value of all consulting services.

Don’t get me wrong! We are still competitors fighting over a share of the pie. But we should fight in ways that grow the pie and not in ways that shrink it.

Another area in which iterated games produce counterintuitive results is negotiations. The short-term approach is to get as much as possible out of a single deal. In contrast, the long-term approach is to achieve a win-win so that the counterpart is more likely to come to us with another win-win deal.

The point is, plenty of games are zero-sum over the short term and positive-sum over the long term. Therefore, playing long-term games as if they were zero-sum often hinders your long-term growth.

Consider which parts of the game you play might shift at least partially to positive-sum over long enough time horizons, and play them accordingly.

Note: this was an excerpt from my best-selling book, “Winning Long-Term Games”