Reaction Paper on Game Theory Essay
Reaction Paper on Game Theory
Game Theory is undeniably new to me. Its concept is just so brilliant that it made me rethink how I ought to see a business’ road to success. In the past, my key idea of winning in the industry was by toppling down competitors, and rising as the sole survivor in the war. Plainly, it’s a winner-take-all perspective. The real target was to capture the entire market then. After reading the theory and the cases suitably alluded to, realizations came to me that I’m way too far from the wisdom good strategists possess. Way too far from making it to the corporate executives’ seat.
Way too far from a business’ lifelong success. For Filipinos, it’s always been a “here-and-now” match. Typically overlooked are the impacts of strategies in the long run, and how competitors and other players in the game would tend to respond.
Game theory offers the notion of coopetition — cooperative and competitive ways to change the game. The primary insight of game theory is focusing on others — namely allocentrism. It further states that the game of business is all about value: creating it and capturing it.
Many are the so-called mental traps that must be killed in order that one be set for the game or set to change it. We often think that it’s hard and it’s beyond our competencies to dare change the game, and that we should do just what others do — only in a differently-tailored fashion. We go with the flow and no new routes are shaped to arrive at a better position and standing for us and the other players as well. Just like the Zero-Sum View, we tend to see winning only at the loss of another. Because of these delusions, the scales in our eyes gets even thicker and we finally end up blinded from seeing the bigger picture, the whole game.
To be able to use game theory as a tool in strategizing, I recognized that it cannot be used without sufficient knowledge in economics. Given a particular action, the players that get affected and would react are to be properly determined. The cause and effect relationship among them must also be linked as it should be. Rational reasoning and forecasting entails academic competence on the subject to enable you to see the domino effect of your decision to others and back to your company.
The business game is really like chess. Sometimes you have to give in or even sacrifice some of your aces to obtain a greater advantage or to make a draw at the very end. At times, you must delay a couple of moves to maintain advantage or stay equal with the opponent just like what Nintendo did. Being egocentric must be done away with and altered to focusing on others to facilitate a win-win situation for both parties. An opponent may retaliate or be unwilling to cooperate in the future if one’s strategy always seeks out the highest payoffs at the cost of the other player.
That’s the mindset of Kiwi that kept it alive in the game. Also, you must raise your own added value or lower that of others and consider that the role of every player in the game is not fixed.
In spite of its applicable purposes, game theory cannot be said to be the perfect treasure map. There will always be creases that would simply be left out unpressed. Be flexible and ready for changes.