Most leaders are utilizing a finite mindset in the infinite game of business. Doing this means that they lose trust, cooperation, and innovation along the way. In contrast, infinite-minded leaders create much more reliable and competitive organizations. They even shape our future and leave behind resilient organizations and legacies that last generations. The Infinite Game describes how you can create a business that will stand the test of time and challenge modern capitalism.
About Simon Sinek
Simon Sinek is a leadership expert who has identified clear patterns in the way companies and politicians excel over the long term. Simon is a British-born American author and motivational speaker. He is now the author of five books and lectures at Columbia University.
“The definition of the responsibility of business must: Advance a purpose: Offer people a sense of belonging and a feeling that their lives and their work have value beyond the physical work. Protect people: Operate our companies in a way that protects the people who work for us, the people who buy from us and the environments in which we live and work. Generate profit: Money is fuel for a business to remain viable so that it may continue to advance the first two priorities.” – Simon Sinek
Business Leaders Have to Embrace an Infinite Mentality
“Where a finite-minded player makes products they think they can sell to people, the infinite-minded player makes products that people want to buy. The former is primarily focused on how the sale of those products benefits the company; the latter is primarily focused on how the products benefit those who buy them.” – Simon Sinek
Lots of systems in life can be utilized by following specific rules. For example, sports involve a wide range of rules that have finite endings. There are a certain number of minutes to be played or points to be gained before the match is finished. These types of systems are finite.
In comparison, business is not a finite game. Therefore, business leaders have to embrace an infinite mentality. Businesses do not have beginning or end times that are decided upon: it runs 24/7. There are some specific rules and guidelines, but overall the business ‘player’ is left to decide what they want to do with those rules. Plus, the players involved in infinite games can be either known or unknown players. There are also infinite periods and no fixed method of keeping score. Plus, as nobody can ‘win’ in a finite way, business is an infinite game where the goal is to remain in the game for as long as possible.
Some see profit and income as the only indicators of business success. This is too simplified an approach as these high profits will mean nothing if you cannot survive the financial difficulties of tomorrow. Therefore, business is about creating a system that will help you remain in the game for future generations rather than winning in the short-term.
Subsequently, Simon suggests that business people focus their business plans on long-term goals. Focusing on short-term goals will lead to tunnel vision. Instead, try and think innovatively and produce a product that will be needed both now and in the future. Plus, utilize metrics. Metrics are the only markers of progress that help you actualize how effective you are being.
Simon uses the examples of Microsoft and Apple to describe a company that has adopted a finite mindset (Microsoft) and one that has adopted an infinite mindset (Apple). Apple released one of the first MP3 players when they launched the iPod. Subsequently, Microsoft aimed to compete with Apple by releasing its feature-rich Zune. They released Zune as a way of capturing Apple’s market share. In comparison, Apple was not aiming to compete with anybody else. Instead, they continued to innovate by redesigning smartphones. These smartphones would then make MP3 players relatively obsolete. Apple’s infinite mind helped them dominate the market without even competing with Microsoft.
Develop a Just Cause
Simon explains that a just cause should always underpin your business work. If you have a just cause, you have something that can be applied now and in the future. Often just causes will aim to produce a better future and give the company’s workers something to be passionate about. Simon explains that your company’s just cause must be strong and able to survive future transformations.
Despite just causes being future-oriented, they should not be unattainable. Often companies state they will be the leading company in a specific field. This statement is a tunnel-vision that won’t allow you to diversify and increase your long-term chances of excelling. The book provides an example of a company that adopted unattainable goals. The GPS company, Garmin, stated that they would become the worldwide leader in all markets relevant to their product. Subsequently, their attention was inward, and they did not consider the positive impact they could have on their customers. Smartphone apps then developed advanced GPS technology. Instead of producing a smartphone app, Garmin persisted with their devices and are now one-third of their 2007 value.
Simon outlines specific characteristics that a company’s just cause must be defined by:
- For something – Your organization should be based on something that you stand for. This should not be something you stand against, but something that you stand for. Microsoft’s attempts to challenge Apple was an example of standing against something. This approach does not work
- Open to Everyone – If your just cause is powerful enough, you will draw in people who are willing to offer their time and effort to advance your work. Therefore, infinite minded leaders hire employees and attract customers and investors that believe in the company’s just cause
- For the Primary Benefit of Others – The primary benefit of your company’s just cause should be going to people other than the company’s contributors. A leader should not be investing his time for his benefit, but the benefit of the employees and customers he leads
- Resilient to Political, Cultural, and Technological Changes – You want your just cause to be greater than products or services. This is because an infinite game relies on your company surviving market rises and falls. Therefore, you must develop a just cause that allows your company to be resilient
- Idealistic, Bold, and Unachievable – Just causes are ideals. Therefore, they are future-oriented and should be applied across periods. One way to ensure your company’s just cause is applied over generations is to write down your vision. Writing down your vision will allow your just cause to remain even if you, as the founder, have gone
Capitalism Has a More Negative Impact Today Than Ever Before
Capitalism can fall into one of two camps. You can either be a business that places your clients or your shareholders at the center of your decisions. Back in the mid-eighteenth century, Adam Smith wrote The Wealth of Nations. This book provided the groundwork for the capitalism of the next 200 years. This form of capitalism placed clients at the center of business decision-making. Fundamentally, to be a successful business over a long period, you have to put your clients first.
Despite this, Milton Friedman shifted people’s understanding of capitalism from the consumer towards the mid-twentieth century shareholder. Specifically, Friedman stated that businesses’ role is to gain money for shareholders. It is not to provide a service to consumers. The issue with this approach is that it focuses on short-term income increases and improvements in profit. Profit can be improved by reducing costs by reducing the quality of products and paying workers less. This approach is not a viable long-term plan. Simon argues that this transition towards short-term capitalism is why CEOs have become exponentially more wealthy. The average business person’s wealth has stagnated.
Simon suggests three pillars of business that should be incorporated for the infinite game to survive short-term capitalism:
- Further a larger purpose
- Protect people, including your employees, customers, and the environment
- Generate profit. Profit will allow you to maintain the first two pillars of your business
Successful Business Leaders Prioritize Their Workers Over Their Profits
“The ability to succeed is not what makes someone a leader. Exhibiting the qualities of leadership is what makes someone an effective leader. Qualities like honesty, integrity, courage, resiliency, perseverance, judgment and decisiveness” – Simon Sinek
Pulling people into your vision for the future is one of the most important ways to produce business longevity. However, humans are great at detecting false information. Therefore, you not only need to be honest with and respect your customers. On top of this, you need to show respect to your workers. Your workers are part of your just cause, and they must invest in your business over the long term.
Respecting your workers is an inexpensive way of producing high levels of motivation, loyalty, and efficiency. Each of these will help rapidly improve your business’ revenue. Simon provides the example of Apple. Early on, Apple decided to provide its retail workers with the same company benefits as their business workers. For example, they received the same healthcare packages and retirement bonuses. The outcome was that Apple saw rates of work retainment rise to approximately 90%, while the retail industry average is about 20-30%. Subsequently, Apple spent less money on finding and retraining new staff.
Choose Will Over Resources
Simon describes two features that are essential when playing the infinite game: will and resources. Resources are obtained from external sources and consist of material elements, such as money. Often, resources will be acquired from either investors or customers.
In comparison, will is encouraged through internal sources. Examples of will are morale, motivation, commitment, and the desire to engage. During tough financial times, there is a tendency for finite-minded leaders to prioritize external resources. Hence, market crashes are often accompanied by large-scale cost-cutting by reducing a product’s quality or making employees redundant. Adopting this approach will harm a company in the long run. Suppose external motivations are the driving factor for a company. In that case, your company culture will encourage loyalty based on bonuses and perks. In contrast, a company culture built on trust and intrinsic motivation will produce a workforce that will pull together during hard financial times. Simon explains that prioritizing will over resources offers a more effective way of maintaining resources in the long-term.
Build a Business Culture of Trust
If your company only cares about profit and being the most successful business, distrust can arise. On top of this, a culture of profit will encourage unethical business habits. Ultimately, distrust and unethical business habits will ruin your business’ longevity.
Low efficiency and mistakes are far more common in businesses where the workers do not trust the business. One of the main reasons for this is that employees feel unable to voice their opinions on decisions or call out mistakes. These issues were commonplace in Ford Motor Company before 2006 when new CEO Alan Mulally took over. The former CEO would frequently sack employees who brought bad news to him. Subsequently, when Alan took over, the employees continued only to provide him with good news. To overcome this, Alan implemented weekly business plan meetings where everyone could bring any bad news. Alan believes the trusting teams this practice produces has allowed Ford to continue to thrive.
Simon describes the type of environment Alan Mulally produced as a Circle of Safety. The employees felt safe and were willing to show vulnerability, admit mistakes, and accept support. As well as leaders cultivating this Circle of Safety, leaders must hire employees with this Circle of Safety in mind. As an example, Simon talks about the Navy SEALS. The Navy SEALS are one of the most efficient teams on Earth. Simon attributes part of this success to Navy leaders choosing their teams based on both performance and trust. Importantly, these leaders prioritize low-performance high-trust individuals over high-performance low-trust individuals. These leaders understand that although individuals with low-trust might perform well individually, they will only perform to develop their careers. Over time, this will lead to worse overall performance for the team than an individual who buys into an organization’s cause.
The result of a culture of trust is that the firm’s values and conduct are aligned with its customers rather than profit. Simon outlines how organizations need to start measuring organizational trust in the future. There is currently a wide range of metrics for measuring performance, but very few measuring trust. Leaders are not responsible for the team’s result, but the people who are then producing the organization’s results. Subsequently, the most important trait to be measured in a team is trust rather than performance.
As well as creating a trusting culture, it is also vital to create an organizational culture where unethical behaviors are frowned upon. Simon describes ethical fading as a time when an organization’s culture allows unethical acts to be committed by employees without a conscience. These types of workplace culture mean that employees do not even realize they have compromised the organization’s principles.
Simon explains that ethical fading can become gradually worse. Every time an unethical decision is left unchecked by the organization, employees will be further convinced the organization cares more about performance goals than ethics. Subsequently, unethical acts become more likely. The impact of ethical fading is that the organization loses touch with its just cause. This can have a far greater economic cost for the organization than the potential short-term benefits of an unethical act.
The response of finite-minded leaders to ethical fading is to bring in more processes to control unethical acts. However, the problem is often not how things are being done but why they are being done. Therefore, the best approach for reducing unethical acts is to provide a robust just cause and a trusting team. This combination will help employees understand the organization’s higher goal and be accountable to their team.
Learn From Your Successful Rivals
Again, Simon uses the example of sports to describe how vital our rivals are. In sports, it is well known that it is a huge advantage having a worthy rival. Even if they have more excellent abilities than you, these rivals will drive you on to better your business.
Besides being an essential feature of successful sports teams, learning from rivals is also an essential feature of infinite-minded businesses. Again, Alan Mulally ensured that his employees utilized his rivals’ skills to learn themselves. For example, he made his senior management drive cars manufactured by Toyota and Lexus. He wanted his managers to study their opponents and understand the areas where these cars were performing better than Ford.
Similarly, Mulally did not want his fellow car companies to go out of business. During the 2008 recession, there were multiple car companies, including GM and Chrysler, who were in danger of dying. Mulally approved of the government bailing these companies out. He understood that successful rivals would only help his business work in the long run.
Adopting an Infinite Mindset Requires Courage
It requires courage to lead by example. Courage to Lead demonstrates a commitment to the cause. Suppose the owner of a business is willing to challenge the prevailing views for the better of their customers. In that case, their workers will likely do the same. It is difficult for CEOs to adopt this approach, though. CEOs are often used to the roles of COOs and CFOs. Within these roles, daily worries are finite.
A CFO regularly handles the figures on a balance sheet while a COO handles the day-to-day organizational difficulties. Henceforth, individuals moving from these roles into a CEO’s role will struggle to think about the bigger, long term picture. Being a good leader is about focusing on the future rather than the present. Good leaders strive for innovation in all they do rather than just trying to sell what they know already sells.
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