MEREDITH Strategy + Design

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The bar at El Farol, evaporative cooling, and the high performance workplace

I've learned that in game theory there is something called the "El Farol Problem."

In Santa Fe, there is a very popular bar, El Farol, called by some one of the best on earth, a place where everybody in the community wants to go and where they, sometimes, have a great time.

The El Farol Problem is that, if too many go, nobody has a good time. That is, if more than 60% of the population that wants to go to El Farol chooses to go on a Thursday night, nobody has as good a time as they'd have had if they'd stayed home. But if less than 60% of the population goes, everybody will have a better time that if they'd stayed home.

The El Farol Problem is really about decision making, but it is also about density and selection, it seems. That is, if too many people go to the bar on a certain night, the overcrowding may be unpleasant. Also, I assume, some of the fun of the place may be in being there when the "right" people are there, but too many of the other people may make the place less desirable.

I came to the El Farol Problem through a reference to the theory of the Evaporative Cooling Effect. That is, when certain high contribution people leave a group, the average status of the group declines. As each successive next tier recognizes that its value is diminished and leaves, those left behind are the ones who are clueless as to their value to the group.

It's made me search a bit for the similar but perhaps inverse conditions. That is, under what conditions does the value of a place increase when everybody shows up? And what are the right conditions to avoid the issue of evaporative cooling and consequential value to a group? More specifically, does the El Farol Problem and the Evaporative Cooling problem inform the way we think about working environments?

As an office that I work in periodically began to clear out before the Independence Day holiday, there were the usual few who spoke of coming in to the office over the weekend because it was, they said, when everybody was gone that they were most productive. This, of course, is a manifestation of the disruption paradigm that implies that the office is the least effective place to work, especially if it is a more open environment, and greater openness and density yields underperformance. The work that gets done in the low-density absence context, however, is typically the least valuable work of the community, i.e., individual janitorial work like getting the project files organized. Why do individuals perceive value in "solitude" the office environment when that solitude produces no value, yet also complain of lack of productivity in a context of population when the organization believes that it is most valuable?

We've developed a "mainstream" workplace culture of two types: A compulsory attendance workplace and a compulsory absence workplace, a workplace where work tasks or management style requires you to be there, or one where mobility has enabled and then required you be elsewhere.

The compulsory attendance workplace evokes the El Farol, to a certain extent. It is a place where there may be too many people, and too many who are not the right people. It is an overcrowded place, where the discomfort that arises from density, the distraction of having too many who are not contributing effectively, makes the place unpleasant for everyone. The compulsory absent workplace is evaporative cooling institutionalized. The "in crowd," the real leaders, have left. Those left behind are filing, and most of the others who want to achieve are searching the landscape for leaders.

I propose that there is a threshold of organization performance that is aligned with the amount of choice people have in their selection of a work environment, including both physical place and team. I also believe in the Hagel/Brown concept of "pull platforms" where the value of an organization, the value of its work, and the value of the place where its people work increases with the choice, not the requirement, that people have to be there.

It is becoming increasing clear that environments provided as "standards" and frequently even as "guidelines" are the places of least choice by "high status" people, i.e., people with a purpose and a mission. I propose that by observing, questioning and challenging the individuals and teams who contribute most to an organization and its purpose, one can derive a set of attributes for the next workplace. It will be workplace of the right 60%, and with supports rather than constraints that will be continuously attractive and eliminate the evaporative cooling effect.