The Ultimate Game of Strategy - contents
Part 1
Background to Game Theory
Part one introduces some of the basic elements of Game Theory. Not the most appetising way to start a book, but, as a rudimentary knowledge of Game Theory is going to be essential to anyone using the Internet for business it is best to get this propeller head stuff out of the way first.
You might well ask why Game Theory should be so important in e-business. It is because Game Theory is the most appropriate framework for dealing with uncertainty, unknowns, complexity and competition. This is the environment in which e-business will be conducted. It is an environment where conventional business methods and procedures are severely compromised and start to break down.
Conventional business is based upon eliminating uncertainty wherever possible to allow reasonably accurate predictions to be made. This is fine if you know what uncertainties there are, but, in the fast moving world of communication technology this is not possible. Predictions are therefore always highly suspect.
Game theory is based upon the enigmatic and counter intuitive effects of the laws of chance and probability. These effects defy logical explanation - but, this is why Game Theory is useful. It works when logical reasoning cannot come up with the right answers.
Chapter 1
Starting with the basics
Business acumen
The enigmatic nature of probability
The mystery War games
Predicting the future with probability
A free holiday in Monte Carlo
Chapter 2
Through the looking glass
Borrowing money to play roulette
The analysis of a roulette system
Relating roulette to business
The source of profit
Going through the looking glass
What does it mean in the real world?
Implications of the roulette results
A seemingly impossible problem to solve
Dealing with unknowns and uncertainty
Chapter 3
Choosing in conditions of uncertainty
Feedback from the cafe
Many small risks or one big one?
A range of possibilities
But it is possible that you can never win
Clearing up a paradox
Part 2
Dealing with complexity and information overload
Part one dealt with chance and probability. This is a kind of uncertainty, but, it is the kind of uncertainty that can be handled with mathematics to bring about some degree of order and predictability. Once you ascertain probabilities, decisions can be made. However, it is not always possible to ascertain probabilities. Sometimes, it isn't even possible to know what it is you have to get the probability of.
In this section we are going to deal with quite a different type of uncertainty, where mathematics cannot help at all. It is the uncertainty and confusion that is caused by complexity and information overload. It is the uncertainty caused by having too many personal knowledge gaps and knowing that everyone else has knowledge gaps as well.
This is the real world of e-business, where it is not about knowing what is the best action to take but deciding what to do when you can't possibly know what is the best action to take.
Mathematics can't handle this kind of problem. But, a Game Theory framework can.
Chapter 4
To start an e-business venture with a great business idea is the wrong approach
The value of a business idea
Making your own luck
Becoming part of a system
The big picture
Islands in a sea of randomness
The new paradigm shift
Chapter 5
The problem of knowledge gaps
Coping with technology
Being able to appreciate individual limitations
The resolution of a paradox
Jig-saw puzzling
Chapter 6
Understanding and coping with knowledge Gaps
About this chapter
The need for a few fundamentals
Paradigm shifts Learning in the environment of e-business
Cooperative learning environments
Limitations of the cooperative learning environment
Collaborative learning
Collaborative learning on the Internet
Part 3
When the managed team doesn't work
Fundamental to all Industrial Age business theory are the concepts of planning, cooperation and the managed team. The problem for organisers and managers, switching over to e-business from a conventional business environment is that these concepts are not always viable or practical in a massively connected world.
Part three explains why these concepts are highly suspect; why they break down. It offers alternatives that are more reliable.
This part was intended to be a single chapter, but, the disbelief and the reluctance to accept that planning, cooperation and managed teams are inferior organisational constructs in the information environment has necessitated stretching this section out to four chapters.
There is much repetition, as the same points of view are approached from different angles, but, it is essential for anyone using the Internet for business to break away from the central dogmas of conventional, Industrial Age business theory. It is not that they are wrong, it is just that they don't work in the world of the Internet the same way as they do in the world of bricks and mortar.
Chapter 7
A cooperative team versus a collaborative team
Blind spots can inhibit understanding
The need for a new kind of thinking
The limitations of a managed team
Team management
Team leadership
Problems for a leader
Cooperation or collaboration?
Chapter 8
The enigmatic nature of creativity and success
How do you make collaboration work?
An industry founded upon collaboration
In the beginning
The process of creation
The enigmatic nature of an auteur's contribution
When you run history at fast forward
Last minute good ideas
Chapter 9
A collaborative environment
Getting business ideas into perspective
The emergence of a system of collaboration
An autocratic system
Soliloquies as an e-business strategy
The role of the auteur
Chapter 10
Different interpretations of collaboration
The main players in the game
The collaborator's view point
How collaboration emerges
How nature finds solutions.
It's not the rate of change, but, the changing rate of change that is the problem
More than one solution
An example from the world of bricks and mortar
Part 4
Creating a group of contacts
Fundamental to all Industrial Age business theory are the concepts of planning, cooperation and the managed team. The problem for organisers and managers, switching over to e-business from a conventional business environment is that these concepts are not always viable or practical in a massively connected world.
Part three explains why these concepts are highly suspect; why they break down. It offers alternatives that are more reliable.
This part was intended to be a single chapter, but, the disbelief and the reluctance to accept that planning, cooperation and managed teams are inferior organisational constructs in the information environment has necessitated stretching this section out to four chapters.
There is much repetition, as the same points of view are approached from different angles, but, it is essential for anyone using the Internet for business to break away from the central dogmas of conventional, Industrial Age business theory. It is not that they are wrong, it is just that they don't work in the world of the Internet the same way as they do in the world of bricks and mortar.
Chapter 11
Introducing the Genetic Algorithm
Scary words and arcane theories
Word of mouth and viral marketing
Engineering a craze
A very simple strategy for success
The structure of an ecosystem
The magical algorithm
Applying Genetic Algorithms to e-business strategies
The position of the collaborator or freelancer
Chapter 12
A question of trust
Advantages of using a Genetic Algorithm Strategy
Apparent problems with a Genetic Algorithm Strategy
What is the role of the auteur?
Dealing with the problem of trust
Sensible game play
The importance of credibility
Planning or strategy?
Various kinds of cooperators
Chapter 13
Creating a community trust
A disorienting chapter
What is e-business really about?
Difference between a plan and a strategy
Heuristic strategies
A perfect example of a heuristic strategy
The most important of the commandments
Nomadic tribes and the Internet
Back to a personal cognitive model
An alternative strategy
Part 5
Communication strategies
The first four parts of the book were about thinking and theory. They provided essential background for action, but, not the action itself. In part five, attention is switched to finding a way to apply this knowledge to practical purposes in the real world.
In the first of these two chapters, the Internet is transformed from an apparent sea of random noise into a valuable information network. The second chapter sets about devising strategies to make efficient use of this valuable resource.
While reading through these next two chapters, the foremost thought in the mind of the reader should be "How can I make strategic use of the Internet to help me solve all the problems associated with my chosen niche in the world of e-business".
Chapter 14
The information ecosystem
Whole world versus local world
Egocentric pockets of organisation
The Kevin Bacon game
Small world clusters
The surprise
The significance of small-world clustering
Multiple, simultaneous meetings
The viability of having many contacts
Universal implications of small-world clusters
Effects on sales and marketing
The sociogram
A strategy for interfacing with the network
Chapter 15
Communication strategy
Message capacity limitations
The filtering process
The strategy to reach a goal
The role of feedback
The principle of the servo mechanism
Why should people collaborate?
An evolving system of contacts
Rejection and redundancy isn't a problem
How do you choose your contacts?
E-mail discussion forums and news groups
A newspaper metaphor
The uniqueness of e-mail discussion forums
Part 6
Bringing it all together
The biggest problem in dealing with the Internet is that it makes demands upon our brain that the human brain hasn't evolved to cope with. We have evolved memories and neural information processing mechanisms designed to cope only with a limited number of people and a limited communication bandwidth.
Now, the Internet is giving opportunities and information that is taxing the human brain beyond its limits. It is completely overwhelmed by all the complexity and over-choice.
Most people are coping by limiting their use of the Internet so that is doesn't over load their natural neural systems. They place strict limits on the number of people they deal with. They confine their information to fit in with the bandwidth that nature limited them to. But, there is no need to limit ourselves to within the capabilities of our natural human brain. We have computing power than can selectively enhance its ability to deal with larger numbers of people and an increased bandwidth.
As an example of the way in which computers can enhance the ability of the human brain to cope with complexity we need think no further than the spreadsheet program. This has massively enhanced the capability of the human brain to handle mathematical calculations and logical modeling.
This final part describes a way of using the computer to do for the human brain in communications what the spread sheet did for it in mathematics and logic. An enhancement that provides super human powers to cope with extensive communication, complexity and information overload.
The difference though is that a spread sheet deals only with logical reasoning and known quantities. For most problems in e-business we need to be able to cope with the illogical, the unexpected and the unknowns.
Chapter 16
The cafe as a case study
The third dimension of e-business
The publishing business
Similarities between different players in the game
Advantages of a personal Web site
Discovering that it is a fast changing world
The background
The Interaction of cafes and tables
Chapter 17
Customers as product designers
Panning for gold
The only designers who know what to design
A cafe as a guidance device
The dilemma
The problem of content
Creating the cafe
The cafe as a problem solver
The cafe as a guidance system
An organic intelligence system
Reconfiguring the cafe
From book writing to e-business
Final conclusion