Accessible text version. Each heading below is one slide, in order. Instructor: Ryan Lamare.
LER 565, Week 4 live session: Coordination Games between HR and Management. Instructor: Ryan Lamare.
One: a quick look at this week's materials. Two: coordination games, recapped — many equilibria, one to land on. Three: three games tonight — the Investment poll, Battle of the Sexes, and a little Quiz. Four: Azee match number three; reflection number two is due this Sunday.
Lecture: Coordination Games in HR — stag hunt, battle of the sexes, chicken. Clips: Moneyball; The Gift of the Magi; Footloose. Readings: A Beautiful Equilibrium; Guess Who Doesn't Fit In at Work; How Challenger Exploded. Podcast: Freakonomics, Failure Is Your Friend.
A coordination game has several equilibria; both sides want to land together. There is no dominant strategy, so we use best response: a Nash outcome is a mutual best response. A focal point is the equilibrium expectations converge on, made obvious by context. Three HR games: stag hunt where interests are aligned, battle of the sexes where they differ, and chicken where they are opposed.
The whole class plays at once. Each of you can put ten dollars into a shared venture, or not invest and keep it. It pays off only if nearly everyone invests: then your ten becomes fifteen. Invest while others do not and you lose your ten.
What you just played, as a payoff matrix: a stag hunt. Mutual Invest pays plus five each; nobody investing pays zero each; both are equilibria. Invest while everyone else does not and you lose ten, the worst case. Not investing while everyone else invests and you get zero while they gain. Two equilibria, and trust decides which one the room should land on. The matrix is the lesson, not part of the game.
A battle of the sexes. You have merged into one team and need one weekly meeting time. Team Sales wants the 9 AM slot, since they are out with clients all afternoon; Team Engineering wants 2 PM, since mornings are for deep work. Pick the same slot or half the team is always missing, but each side prefers its time.
What you just played, as a payoff matrix. Both want the meeting to happen, but on a different slot. If both pick 9 AM it is three to two; both pick 2 PM is two to three; a split fails at zero and zero. Two equilibria, and the fight is over whose slot. The matrix is the discussion, not part of the game.
Answer each question to match your classmates; you score only if about ninety percent agree. No conferring: you are coordinating on instinct! We reveal the answers together afterward and see where the class converged. The point: focal points form from shared context and common knowledge. An interactive version of the quiz is linked from this slide.
A meeting’s booked, but no time is given. When does it start? The focal answer is 9:00 AM. The start of the workday is the shared default — the obvious round anchor everyone reaches for.
Silence opens the meeting and no chair is named. Who speaks first? The focal answer is Whoever called it. Calling the meeting creates the obligation — the role is the focal point, not seniority.
Two teams must standardize on one tool, never having discussed it. Which wins? The focal answer is Leadership’s. Authority is a focal point: the option power backs is the one everyone expects everyone to expect.
Everyone must land on the same number from 1 to 4, with no talking. The focal answer is 1. First and smallest — the most salient point in any ordered set.
Two of you delivered it jointly, with no rule for who gets what. The focal answer is 50/50. Equal division is the fairness focal point — it needs no justifying, so everyone expects it.
You each must name a “fair” salary inside a posted band. The focal answer is The midpoint. The middle of a range is the natural compromise — symmetric, so neither side concedes.
You know the day and the time, but not the place. Where do you go? The focal answer is The Eiffel Tower. Schelling’s classic: the single most prominent landmark, known to be known by all.
Straw poll — Walsh 29, Singh 28, Rivera 19, Okafor 9, Tan 6. Back the likely pick. The focal answer is Walsh. The front-runner is the focal point — coordination flows to whoever’s already ahead.
Everyone gets a bonus only if all name the same figure. How much? The focal answer is $1,000,000. The biggest round number wins — maximal yet unmistakably salient, so expectations converge.
Your third Azee match, same five-minute clocks as before. Reflection number two, on prisoner's dilemma or coordination games, is due this Sunday, July 26. Watch for coordination: where do you and others want the same tile? Where does a shared convention beat fighting over the board?
Information asymmetries: when one side knows more than the other. Signaling, screening, and the lemons problem in hiring and pay. How what you know, and what you reveal, reshapes the game. Due Sunday, August 2: the Week 5 quiz.