Fully Remote Organizations and the Prisoner’s Dilemma

There’s a part of working in a fully remote environment that I am still struggling to understand, as a reformed philosopher and general skeptic.

Automattic, where I work, works. We get an astonishing amount of shit done, and we do so across a number of product lines and continents. We all work from home, or wherever we can find a flat surface and a clear wifi signal.

One of the things that surprises people the most about Automattic is the immense level of trust that is placed in every employee; it’s baked into the culture. We are committed to transparency and communication. We’re trusted to do our very best work and to find motivation intrinsically, rather than having it nudged upon us by bureaucratic processes or micromanagement.

As a student of philosophy, especially social choices, something about this model has always seemed rough around the edges to me. It sounded good, and it seemed like people believed it, but in theory it seemed like it should not work.

We can parse this disbelief of mine in the terms of the classic prisoner’s dilemma, what’s called a collective action problem.

Shipping, supporting, and improving something like WordPress.com is a huge task. It takes lots of people working together, collectively, to get it done. There are problems associated with this kind of collective action – one of them, the basic building block, is the prisoner’s dilemma.

The prisoner’s dilemma goes like this:

  • You have two prisoners, X and Y. They’re kept separate.
  • They’re offered plea deals: if X rats on Y, he can get off with a reduced sentence. If Y rats on X, he gets the same deal.
  • Both X and Y know that the cops don’t have enough evidence without someone ratting.
  • If neither X nor Y betrays the other, they both serve 1 year for a lesser sentence.
  • If X and Y both betray each other, they each serve 2 years.
  • If X betrays Y but Y stays silent, X goes free and Y gets 3 years.

Short story long, in a prisoner’s dilemma, ratting leads to suboptimal outcomes in terms of overall jail time. The best outcome across both actors (2 total years in jail) require both to remain silent – but the only way to pursue your own maximal outcome (no years in jail) is, by definition, removing the best outcome for both prisoners.

Individuals acting rationally  to maximize their outcome ensures that the optimal collective outcome is not reached.

If your aim is to guarantee the lowest amount of jail time you get, the lowest possible jail time comes from the combination of your betrayal and your comrade’s remaining silent. The worst possible outcome results from your keeping silent while your erstwhile comrade betrays you. In the prisoner’s dilemma, betrayal always has the better calculus.

I’m cutting this short because this is a blog post, but collective action problems are super duper interesting.

If you want to dive down this rabbit hole (and if you do then we have the same kind of brain!), here’s a great place to start.

We can see the prisoner’s dilemma crop up all over the place, but especially when it comes to things like a public good. Let’s say your neighborhood wants to build a playground. You’d like a playground in your neighborhood and folks are taking up a collection (or possibly a Kickstarter, it is 2016 after all). The very best outcome for you would be if the playground gets built with no donation from you, if others contribute but you do not – because the good that is created is enjoyable for all and cost you nothing.

You’d be a free rider. But no one would know. Then you could spend your would-be donation money on champagne and Oreos.

It’s the prisoner’s dilemma that gives me pause about working fully remotely, because within the company, we have a bunch of really outstanding public goods. There are the obvious ones: unlimited vacation, being able to set your own schedule, outstanding health benefits.

When we dig a bit deeper, even more public goods come into focus; access to top talent who are generous with their time, the ability to work where you see the most impact – or to not work when you so choose.

When we think about these public goods, especially in the context of a results-only work environment with personally set schedules, we get to a place where it looks like the rational behavior is to not work that hard.

Stay with me, now.

Look, if we imagine a perfectly rational actor, who seeks to maximize their own utility at all times, and they see some benefit in the public goods on offer within Automattic, what is their course of action?

In this case, the public good that they’re seeking isn’t really relevant – if they want to move from design to development and want to maximize the time they can spend with a development mentor, or if they want to become the next World Champion of Hearthstone and as such simply want to minimize time spent in non-Hearthstone activities, whatever it is, the pursuit of it stays the same, right?

For our rational actor, to maximize their utility, it is in their best interest to do the amount of work that would get them fired, plus one unit of work. If they skate that edge, they will not get fired but will still enjoy the maximum utility available from the (awesome) public goods available within the company.

We can imagine on another hand, a different actor, motivated in some other way, who spends all of their time heads-down in their work, whether it’s live chat support or RSS feed debugging or expense reports or whatever – in virtue of the facts that a.) work takes time and b.) time is scarce, that means that our second actor here, a hard worker who is dedicated to the company, enjoys fewer of the public goods.

Unless the work itself represents the highest utility for an actor, according to the prisoner’s dilemma the rational actor at Automattic (and similarly organized companies) will always choose to skate one unit above being fired, gobbling up the public goods which are significantly less available to their more dedicated and harder working colleague.

And yet, it works. We work together. We ship software and support hundreds of thousands of customers. I can’t think of even one person I’ve worked with at Automattic who fits the description of the rational actor, above.

I don’t know if this is a problem with the prisoner’s dilemma, or if it should instead represent to me a sturdy underlining of a conclusion that I’ve always suspected:

Automatticians, and other folks finding success in the remote employment world, are by nature something other than purely rational.

I couldn’t be happier with this conclusion. Part of the secret sauce of Automattic is accepting this irrationality and letting each individual sit with it. This is what makes the trust so important. This is part of what makes remote work so special – it helps us move outside a purely selfish position of utility maximizing, and into something else.

Something better.

(Yep, we’re hiring.)

8 thoughts on “Fully Remote Organizations and the Prisoner’s Dilemma

  1. This dovetails in an interesting way with Imposter Syndrome.

    With your argument, the rational actor has to know where that line of enough to get fired plus one is. But that line isn’t really clear, and you really only have one shot at crossing it. It also assemes its a line, which it’s not really. We’re not making parts on a line, we’re providing services to others that are dynamic in scope and effort.

    But Imposter Syndrome. Loads of folks in the company (and every company) worry about their performance, even with reassurance and feedback, even when their performance is well within an acceptable range. I wonder if that gap, between the perceived bottom and the actual bottom, is part of what prevents the PD from taking hold.

    1. Dovetails, eh? It’s always woodworking with you, Ben 😛

      Jokes aside, I think you’re right – part of what lots of modern companies seeking empowered workforces struggle with is the way that vague bottom lines can import really strong impostor syndrome. If it’s laid out from Day One, that you’re expected to do X every day, and at least 2 Ys per month, then you know very well whether or not you’re meeting those expectations – however, it also means that you don’t control your own destiny in some way, right?

      I don’t share this position, but folks certainly argue that setting firm expectations can damage one’s intrinsic motivation – and having folks on board who are intrinsically motivated to do good work is a huge part of the modern empowered workforce.

      Of course, that intrinsic motivation to do good work with no regard to the eventual goodies available to you, is irrational.

  2. You said, “Unless the work itself represents the highest utility for an actor,” and I think that’s really the key here. To channel Dan Pink, it’s about Autonomy, Mastery, and Purpose.

    We want to control what we work on and how to work on it. It’s fun to get better at doing things. We desire to connect to a cause larger than ourselves. Companies like Automattic and Articulate have mastered these principles.

    1. I think you’re on to something, for sure – I don’t know if we’ve mastered it, per se, but having those extra doses of latitude and choice of approach can help motivate folks in positive ways. How much control do individuals at Articulate have over their day to day work?

  3. I think there are other “goods” than the public ones you listed that motivate people to work hard. The ones that come to mind are:

    1. Intrinsic pleasure in work. If you enjoy what you do then the work itself is the reward.
    2. Satisfaction in results. Even if work itself is hard, if the achievements are satisfying, then this can be a motivation to work more.
    3. Recognition. The respect and praise of my coworkers is a valuable resource that can be a motivation to work.

    I try to disconnect my work from my salary as much as possible. Once I have accepted that I need to work in order to live, then the only question is what I do. If I can spend that time doing something I enjoy and gives me pleasure and satisfaction then the fact that I how much I make doesn’t tally exactly with the effort is not an issue.

  4. Thank you for the interesting post. I’m new to the mental model thinking and had trouble applying the Prisoner’s Dilemma to Automattic. With the Prisoner’s Dilemma, the people have done something wrong, are in a place they don’t want to be, and are only looking out for themselves. At Automattic, people have done something right, are where they want to be, and care for each other and the company.

    The model I found easier to apply was the Tragedy of the Commons. As I understand it, each person tries to gain the most benefit from a shared resource and end up ruining it. Individuals use just a bit more because it’s in their own self interest. The negative impact of one person is inconsequential, however, taken collectively, the impact is so great that the source is destroyed. With Automattic, if each person took an extra day off work, then another, then another, overall productivity would eventually degrade, customer satisfaction would decline, and finally the business would fold.

    1. Totally! The Tragedy of the Commons is also a collective action dilemma, and can definitely apply to this conversation.

      The big question in my mind that makes the difference between the two is, by using the good in question, is my usage reducing someone else’s access to that good?

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