Rational Self-Interest

Strategy is regarded as a complex discipline because it inherently involves a large human element. Therefore, to be competent in strategy requires you to be able to read and understand human behaviour.

The good news is that standard human behaviour can be somewhat predicted by understanding rational self-interest.

Simply put, rational self-interest suggests that people generally will behave in a manner that will maximise their own well-being and benefit, using reason and logic to guide their choices. Any person who works with people must understand this basic principle.

It means that a normal person bases his or her decision on two factors, namely self-interest and rationality. Let’s unpack both.

To appeal to someone’s self-interest is to answer the question of: “What is in this for me?”

It is very difficult to influence the behaviour or mindset of another person if you cannot clearly articulate their best interest in the matter.

This can be done by appealing to their sense for monetary gain, personal satisfaction or in the interest of preservation of the things they value, whether tangible or intangible. Not many people can carry out sustained behaviour if they cannot clearly tie how it benefits them.

The second element is rationality. This refers to the use of reason and logic to make choices by weighing costs and benefits to arrive at the most advantageous outcome.

Again, people do not easily make decisions or alter their behaviour if it seems illogical or unreasonable to them. The good news is that it means your work must meet the minimum standard of being reasonable and logical. The bad news is that logic and reason are highly subjective and, therefore, requires you to use the art of persuasion.

Whether it is retail, politics or strategy, rational self-interest remains the basis upon which people make lasting decisions.

In an age of information overload, Sunrise is The Namibian’s morning briefing, delivered at 6h00 from Monday to Friday. It offers a curated rundown of the most important stories from the past 24 hours – occasionally with a light, witty touch. It’s an essential way to stay informed. Subscribe and join our newsletter community.