What is the Essential component of a co-operation? - Trust.
Folk tale of seven Merchants.
Once upon a time there were seven merchants. They were carrying goods from place to place on their backs. They lived in seven villages nearby. One day they were on a quest, and tired of walking all day they met at an abandoned house by the road. As they knew each other, all were happy to see everyone else, and they were hungry.
M1 : "Hmmm... what shall we cook today?"
M2: "We can make a porridge for supper."
M3: "We shouldn't cook separately, as we all know each other, we can cook in a one pot today."
M4: "Yes, that is a good idea. That's easier and faster and more rational."
So, they started cooking. And while the water was boiling, each one was supposed to put a handful of rice from their bags into the water.
First merchant: "Ok I go first. This is my handful of rice." He put his hand into his bag and pretended to take a handful of rice and drop it in the pot. "This is my handful" he said it loud and clear.
Second merchant: "This is my handful of rice." And did the same.
Third Merchant: "This is mine!" went the third one, and everyone else followed.
All of them one after the other shouted in the dark, making an empty fist and pretending they are putting rice into the pot.
As you can see, this didn't work very well. Although each and every one tried to fool the other, there was no single handful of rice in the pot to cook. So, they all were ashamed of the end of it and went back to cook their own meals.
Game Theory and Accountability: The essential component of co-operation
Perhaps this is the oldest story about game theory. In game theory, the best outcomes arise when everyone is cooperative. However, in actual life, this is far from the truth. Not everyone cooperates with everyone else. Instead, they try to trick one another in cooking a porridge pot. They do not play a NICE game; instead, they try to cheat and win. To overcome this, you need to play a different tactic, or Tit for Tat game. You can be a nice player as long as the other party plays it nice, and there needs to be punishment for trying to cheat. And if they started playing nice again, you forget the grudge and play nice, so you both can have great outcomes again.
Apart from the best strategy to play the game of life, this story tells us what glues a cooperation together, and it is TRUST. When there are circumstances where there is no transparency, trust will be broken. Transparency is the way to create trust. Most of the time, transparency is created inside a cooperation by law. When people do not adhere to them for their personal gains, that will generally start a cycle of doom. If there is no trust that a cooperation would meet your expectations, everyone will sell their shares and leave for a better place to start over.
In life, it is always better to work with a few trustworthy people or do it alone than trying to build something with a thousand liars. And if people do understand the benefits, they would cooperate more. Especially if you're a CEO, your greatest asset would be your accountability built over the years, the essential component which holds the co-operation together. Trust if broken it is hard to gain back, like a broken glass. Maybe you should start doing something else than wasting time rebuilding it!
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