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domino effect,
In the game-theory context, this effect could be a series of player choices that lands you in a bad outcome.
However, be aware that the domino effect is invoked a lot more than is warranted, because people are generally bad at determining both the likelihood that events might occur and the causal relationship between events.
fallacious though
The first is the slippery slope argument: arguing that one small thing leads to an inevitable chain of events and a terrible final outcome (in the...
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The second model is broken windows theory, which proposes that visible evidence of small crimes, for example broken windows in a neighborhood, creates an environment that encourages worse crimes, such as murder. The
is unclear how effective they are at actually reducing widespread criminal activity relative to alternatives.
gateway drug theory, which makes the claim that one drug, such as marijuana, is a gateway to more dangerous drug use. However, the evidence for this claim is also murky at best (see correlation does not imply causation in Chapter 5). You should question any situation where one of these models arises and analyze its veracity for yourself (see arguing from first principles in Chapter 1).
loss leader strategy,
When analyzing these domino-effect situations, write down each step in the logical chain (list each domino) and try to ascribe a realistic probability to each event (the probability that each will fall).
In that case, you need to ask yourself: Is that acceptable? Do I need to engage in more active containment, or can a more wait-and-see approach be taken?
you are in no position to meaningfully deter or contain an emerging conflict that you’d like to avoid, appeasement may be a necessary evil. This involves appeasing opponents by making concessions in order to avoid direct or further conflict with them.
For instance, we tend to bend the rules when we are traveling.
As a result, the kids often end up with way more snacks and screen time than they would normally get—appeasement tactics that effectively prevent meltdowns and fights.
keep you out of costly direct conflict.
As a result, the best move is usually not to engage with them (don’t feed the trolls; don’t stoop to their level; rise above the fray),
game. When you practice deterrence through a credible threat, you enumerate a red line, which describes a figurative line that, if crossed, would trigger retaliation (see commitment in Chapter 3).
nuclear option, signaling that you will undertake some kind of extreme action if pressed.
zero-tolerance policy, where even a minor infraction results in strict punishment.
call your bluff, challenging you to act on your threat, claim, or policy, and actually prove it is true, calling you out.
war of attrition, where a long series of battles depletes both sides’ resources, eventually leaving vulnerable the side that starts to run out of resources first.
such as protracted lawsuits, price wars, marketing campaigns, and other head-to-head face-offs, bleeding them dry.
It’s essentially a waiting game.
hollow victory, sometimes referred to as an empty victory or Pyrrhic victory.
you need to find a way out or a way to change the game.
guerrilla warfare, which focuses your smaller force on nimbler (guerrilla) tactics that the unwieldy larger force has trouble reacting to effectively
Well, it first of all comes down to not coming out into the open, where you could be annihilated by the superior firepower of the enemy. The British got a taste of how the Americans would fight on the very first day of the Revolution, with the shot heard around the world, the Battle of Lexington and Concord, where the British regulars marched through the Massachusetts countryside. And the Americans did not mass in front of them but instead chose to slither on their bellies—these Yankee scoundrels, as the British called them—and fired from behind trees and stone walls. And not come out into the
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where startup businesses use unconventional marketing techniques to promote their products and services on relatively small budgets.
generals always fight the last war, meaning that armies by default use strategies, tactics, and technology that worked for them in the past, or in their last war.
last war may not be best for the next one, as the British experienced during the American Revolution.
If your opponent is using outdated tactics and you are using more modern, useful ones, then you can come out the victor even with a much smaller force.
Decisive battles have been won on the back of superior technology like this many times in military history. Don’t bring a knife to a gunfight.
IBM famously miscalculated the rise of the personal computer relative to its mainframe business, actually outsourcing its PC operating system to Microsoft. This act was pivotal for Microsoft, propelling it to capture a significant part of the profits of the entire industry for the next thirty years.
ceding most of the profits in the smartphone market to Apple, which is now the most profitable company in history.
finance professionals missing the signs of the 2007/2008 financial crisis (because they thought the past could predict the future);
U.S. education curriculum misreading the staying power of the digital economy
punching above your weight.
As a mental model, punching above your weight occurs
On the macro scale, whole countries punch above their weight when they engage in prominent roles on the world stage, such as Ireland serving as a tax haven for major corporations.
you should engage in this type of fight only when you can deploy guerrilla tactics that you believe will tilt the game in your favor.
These include the obvious benefit of increasing your chances to reach your goals faster, but also potential exposure to large audiences and opportunities to absorb knowledge from world-class experts.
metaphor can also get you punched hard in the face, so it is inherently risky. It’s like when a new TV show gets marketed to the mainstream but does not retain sufficient viewership and gets quickly canceled—not ready for prime time.
you will want to reevaluate your odds as the game goes on, to make sure you are on the right track. Are your odds improving? Are you effectivel...
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endgame. This concept has been extended to refer to the final stage of any course of events.
at some point most conflicts will end and you need an effective plan either to lock in your gains or minimize your losses.
In a business context, an exit strategy usually describes how a company and its investors will get a payoff through either an acquisition, a buyout, or an initial public offering (IPO).
thinking about the practicalities and consequences of how an entity might get out of certain situations, such as European countries withdrawing from the eurozone.
how you will get out of long-term relationships you don’t want to be in or obligations you no longer wish to be burdened with.
Your exit strategy doesn’t always require a full exit, however.
For instance, given the benefits of preserving optionality (see Chapter 2), you should probably come up with an exit strategy that avoids burning bridges, or ruining relationships with individuals or organizations in a way that thereafter commits you not to going back to them (to cross that bridge ever again).

