Take Control of Dysfunctional Teams with Game Theory: Practical Strategies to Get Your Project Back on Track
Your project is hanging by a thread. The marketing team is pushing for a launch date that's far too early, the development team is still scrambling to perfect the product, and you’re stuck in the middle trying to keep it all together. You’ve seen this movie before—and it doesn’t end well.
If you don’t get these teams moving in the same direction fast, the whole thing will go off the rails. Dysfunction like this doesn’t fix itself, and you can’t afford to wait and hope it all works out.
This is where game theory comes in. Forget the academic jargon—you don’t need a degree in math to use these tools. What you need is a practical approach to predicting behavior, aligning incentives, and getting your teams to work together before your project implodes.
Step 1: Map the Incentives (Identify the Real Problems)
Here’s the hard truth: your teams aren’t acting out for no reason. Their behavior is driven by incentives—pressures that push them in different directions. If you don’t understand what’s motivating them, you’ll never fix the underlying problems.
Your first step is to map out those incentives. This is critical because most dysfunction stems from misaligned goals. When people or teams aren’t chasing the same thing, chaos is inevitable.
Practical Tool: Incentive Mapping
1. List out every key player in your project. Think beyond the obvious team leads. Include anyone whose actions could influence the project’s success—stakeholders, legal, finance, and even upper management.
2. Identify their incentives. What’s driving their behavior? Are bonuses tied to certain outcomes? Is one department under pressure from a C-level executive? What’s at stake for them?
3. Rank the conflicts. Prioritize which conflicting goals are most likely to derail your project. Not every conflict is equally important—focus on the ones that have the potential to cause real damage.
Example: You’re managing a software product launch. Marketing is pushing for speed because their bonuses depend on hitting a revenue target tied to the launch date. Meanwhile, the development team is delaying because their performance reviews are based on delivering a bug-free, high-quality product. These competing incentives are clashing, and unless you address it, the project will break down.
Once you’ve mapped out these incentives, you have a clear view of where the real friction lies. Now, it’s time to fix it.
Step 2: Align the Incentives (Get Everyone Pulling in the Same Direction)
Understanding the problem isn’t enough—you need to change the system. If your teams can still win by chasing their own goals, they will. Your job is to create a setup where the only way they win is by working together.
Practical Tool: Incentive Adjustment
1. Find common ground. There’s always a bigger-picture goal that everyone cares about—whether it’s the success of the project or meeting client demands. This is your starting point.
2. Create shared rewards. Stop incentivizing siloed work. Tie bonuses and recognition to team-wide achievements, like hitting key project milestones. If the project succeeds, everyone benefits. If it fails, no one wins.
3. Set clear consequences. Don’t just dangle rewards—make the penalties for non-cooperation real. If one team misses a deadline, the entire project suffers, and so should the incentives.
Example: In your product launch scenario, you adjust the incentives so that both marketing and development only get their bonuses if the product launches on time and meets quality standards. Now, they’re invested in each other’s success because no one gets paid unless both objectives are met. The teams that were once pulling in opposite directions are suddenly working together because their incentives are now aligned.
Step 3: Evaluate and Adjust (Make Sure It’s Working)
So, you’ve adjusted the incentives, but how do you know it’s working? This is where feedback loops come in. You need to set measurable milestones to see if your teams are collaborating and hitting goals. Don’t assume you’ve fixed everything—monitor the situation and be ready to course-correct.
Practical Tool: Feedback Loops
1. Set collaborative milestones. These should be goals that can’t be achieved by one team alone—like launching a demo version of the product that’s both on time and functional.
2. Track team behavior. Are deadlines being met? Are teams communicating effectively? If things still seem off, dig deeper into what’s causing friction.
3. Gather feedback regularly. Don’t wait for a disaster. Check-in with each team to assess how well the new incentive structure is working. Be ready to adjust if you find new conflicts emerging.
Example: Set a key milestone like delivering a working demo by a certain date. If the demo is delayed or full of bugs, you’ll immediately know that the collaboration is still off. This gives you a chance to intervene before things spiral out of control.
Anticipating Moves: Stay Ahead of the Chaos
Now that you’ve started to realign your teams, you need to start thinking a few steps ahead. This is where game theory shines—it helps you anticipate what your teams and stakeholders will do next. Instead of reacting to problems as they arise, you can predict and prevent them.
Step 1: Build a Simple Decision Grid
A decision grid (also called a payoff matrix in game theory terms) is a simple tool to predict what will happen when people make certain decisions. Think of it as a way to visualize the options and their outcomes. This lets you anticipate behavior before it blindsides you.
Practical Tool: Simple Decision Grid
1. Pick two key players or teams that are in conflict.
2. List their options. For example, marketing might push for an earlier launch, while development might insist on delaying for more testing. List both sets of options.
3. Map the outcomes. What happens if both teams push their agendas? What happens if they compromise? Find the outcome that benefits the project the most and communicate it to your teams.
Example: Marketing wants to push for an earlier launch, while development is adamant about needing more time. If both teams dig in their heels, you’ll either have a delayed launch that kills momentum or a buggy product that damages your reputation. Using a decision grid, you find the best middle ground: launch a minimally viable product that meets both timelines and quality standards.
Step 2: Find the Balance Point (Without the Jargon)
The balance point is where both sides get enough of what they want that no one feels the need to keep pushing for more. This is your sweet spot, where teams can compromise just enough to keep the project moving forward without blowing it up.
Practical Tool: Find the Balance Point
1. Look at your decision grid and find the scenario where both teams win enough to stop fighting.
2. Communicate this balance. Make sure both teams understand that if they push too hard, they’ll end up hurting their own interests as well as the project.
Example: After reviewing the decision grid, you realize that both marketing and development can live with a slightly delayed launch that includes the essential features. You communicate that this is the balance point—pushing beyond this will hurt both teams and the project. This gets them to agree to the middle ground.
Stop Waiting and Start Acting
Here’s the harsh reality: If you don’t take control of your project’s dysfunction now, it’s going to implode. Take 30 minutes today to map out your teams’ incentives and conflicts. Use the tools we’ve covered to adjust their goals and predict their moves before they throw your project off course.
You can’t afford to wait for this dysfunction to fix itself—it won’t. The sooner you start applying these tools, the sooner you’ll get your project back on track.
Looking Forward:
Next time, we’ll dive deeper into building credible commitments—systems that force cooperation without the need for constant oversight. If you want to build a project team that runs smoothly, even when you’re not around, stay tuned. Subscribe now to make sure you don’t miss it!