Operating Principle
2–4 min read
Game theory teaches that outcomes depend on interacting choices. Price cuts invite retaliation, market entry invites response, and visible feature advantage invites copying. A strategy must still work after rational rivals react.
Operating Question
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Why It Matters
Plans assuming competitors stand still are forecasts, not strategies.
Supporting Evidence
Thomas Schelling, “The Strategy of Conflict”; Brandenburger and Nalebuff, “Co-opetition”.
Research Notes
Treat as an operating heuristic and assess the applicable context, limits, and counterarguments.
Practical Actions
Write likely rival responses; plan replies; reject moves that require rivals not to react.