

Are Nash Equilibriums Killing Agile Initiatives? - chadaustin
http://kallokain.blogspot.com/2009/11/are-nash-equilibriums-killing-agile.html

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patio11
This article is a member of the template "I am a consultant in X methodology.
While X methodology is never wrong, it sometimes fails because of Y. For those
of you who don't know what Y is because you did not read the two sentence
explanation of it that I did when Malcom Gladwell covered the topic better, it
is Insert Wikipedia Definition. This means Non-Sequitur, Semi-Sequitur, and
Tangentially Related Thought. X is awesome, please hire me."

Edited to add:

On reflection, that might sound excessively snarky. OK, backing it up: Nash
equilibria do not speak to system-wide improvements, at all. The point of the
game is that players get their own payoffs rather than getting any value from
the sum-of-all-players payoff. The insight from Nash equilibria is that they
can't move to a _higher payoff for themselves_ because it requires
simultaneous cooperation, which is difficult for some games.

Nash equilibira do not attempt to answer the question "Why do organizations
not want to cease to exist?" That isn't a very hard question in game theory --
most players are generally assumed to not desire annihilation. The problem
isn't that you're stuck at a Nash equilibrium -- the problem is that an
organization _does not desire annihilation_. Its like doing a game theory
analysis of my salary negotiation with my employers and saying "Hmm, Patrick
doesn't appear to be taking the negotiation tactic 'Shoot self in head'". That
doesn't imply that my employers and I are at a Nash equilibrium, in fact,
there could be multiple mutually rewarding paths from our current strategies.
Its just that none of them involve me shooting myself in the head.

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richcollins
The most interesting part of the article was unrelated to its ostensible
thesis:

"Suppose, for example, that A charges its internal customer B per hour for
software development services"

If this incentive system is the norm within companies, it is no wonder that
they are having issues.

~~~
bhousel
This is the norm in many enterprise shops that I've worked with. IT sets a
rate that they "charge" their business-side "clients". The rate is set by some
formula that takes into account space, equipment, and other administrative
overhead.

However I don't see how it follows that they have issues because of it. Why do
you think so?

~~~
richcollins
Because you have an incentive to "sell" work, even if it isn't in the interest
of the company.

