The Power of Procrastination
The one who acts last has the most information, and information is power.
This is an old article I'd written several years ago. Since I last posted about negotiating a job offer, I thought I'd re-publish this one that touches on the oldest and most effective negotiation tactic of all -- procrastination.
On the drive back from a recent ski vacation in Utah, we stopped in Vegas and had the opportunity to play a little Blackjack. As I sat there slowly loosing money, I pondered -- "Why does the House have the advantage in this game?".
After all, the dealer's hand is forced -- they are required to hit to 17 and must stand thereafter, no matter what. Furthermore, the rules they are required to play by are publicly published for all players to see. It would seem on first glance, that all things being equal, the player could simply copy the dealer's strategy and break even over the long term. Having the additional ability to double-down, split pairs, and even not hit on 16 should even give the player some small advantage. Several hands (and a few busts) later it occurred to me -- the sole advantage the dealer has in Blackjack is that they get to go last.
If the deal rotated in Blackjack, the players would make a killing. The dealer forces the players to act under limited information. They don't know the dealer's ultimate outcome, but must determine their own fates in advance. The dealer may well eventually go bust after drawing on 16, but if you've gone bust first they already have your money.
The power of deferred action cannot be underestimated and is perhaps most clear in games of chance where tiny differences in advantage can manifest huge profits. Poker players know this well, as having the dealer's position (or button) is the most powerful seat in a hand, and poker players will often raise just to 'buy the button' in hopes of forcing the dealer to fold. The reason is information. The one who acts last has the most information, and information is power.
Most people understand this advantage almost intuitively when it comes to negotiating. You never want to open a negotiation, you always want to be the one responding to an offer. People will go to almost comical lengths to avoid committing to the first move in a negotiation, and well they should -- he who acts last has the distinct advantage.
But, while most people understand the phenomenon of deferred action when it comes to negotiating, it occurs to me that the general principle applies broadly to many circumstances, and this is not widely understood. In fact, many people are uncomfortable having unresolved questions or issues looming over them, and they often place themselves under unnecessary urgency. But, in general, it comes down to this: the longer you can hold out before making a decision or taking decisive action, the better off you will be. This is simply because as time goes by, you gain more and more information. Now, obviously this doesn't apply to every situation, and there certainly are times when external factors require action sooner rather than later. You also want to avoid so-called "analysis paralysis" like the plague, and it's very important to understand that the best way to glean information usually is not research or analysis, but probing experimental action (perhaps another post). But, for every decision you have to make, think to yourself "what factors are really driving the urgency here?" Try to identify the latest point at which you can commit. Then when that time comes, go and go hard.