How To Establish Protocols Between Parties With Competing Interests

We tend to take a lot of the rules we follow for granted.

When you hop in your car and head to the grocery store, you’re assuming that everyone else on the road is going to follow a set of protocols that keep drivers safe and traffic moving.

Without rules, picking up milk would suddenly become a dangerous and time-consuming adventure.

And protocols aren’t just for driving, either. Blockchain technology — and any company that uses it — also benefits from general rules that help people work together.

The problem is, just because you establish protocols, that doesn’t mean people will want to follow them.

It’s difficult to get competing companies to use solutions in which everyone profits from the shared set of rules.

As a solution provider, you have to be able to navigate companies or individuals who think a certain application will be better for their competitors or trading partners than it will be for them.

Here’s how you can do it:

Bring the argument up to a point of agreement.

It’s natural for companies to want a competitive advantage over others in their industry — and to be wary of anything that looks like it could give someone else an edge.

Most companies looking into blockchain solutions also want to gain an advantage from it, without seeing anyone else get ahead. And if you leave the argument at that level, consortiums will immediately stall. We’ve all been in situations where no one can move forward because of one intractable point that seemingly can’t be worked out.

When two parties disagree, you have to raise the argument until they can agree on something.

Say, for example, two people disagree on gun control measures. Can you get them to at least agree that they want to live in a safe society? Then, the conversation becomes more about how we can achieve that safety. Once you’ve broken the constraints and brought them to a higher level — one that supersedes their original argument — then you can begin proposing new ideas and solutions.

You’re simply elevating the conversation to find common ground to work from.

Experiment with protocols to ensure product-market fit.

So many companies with amazing products eventually fail because they lack a market, or couldn’t find the right market fit.

And honestly, that’s going to be an even greater challenge for blockchain companies than it is for your average startup. Nine out of 10 blockchain projects are estimated to be gone by the end of 2018. If that sounds crazy, then you may not have realized the explosion of projects and protocols in the industry of late.

The problem, of course, is that not all of these projects — or even most of them — are fueled by a genuine market need for what they’re providing.

If you want to establish a lasting protocol that multiple parties can actually use, you must be in constant conversation about their different needs.

You have to look at the issue from each party’s perspective and evaluate whether or not you’re providing something essential.

Establish the status quo to set the stage for industry standards.

Even in the pharmaceutical industry, where regulations work to incentivize everyone, it’s still difficult to get all participants in a working group on board with a standard.

Let’s say that manufacturers want full visibility into their supply chains. But the status quo in the industry is privacy.

So, what’s the solution?

Maybe a protocol could create a situation where the manufacturer’s downstream trading partners are able to verify their drug is authentic — an enormous value when it comes to brand protection. The manufacturer won’t get the full, end-to-end visibility they want, but this new status quo helps ensure brand security throughout the supply chain.

Sometimes, trade-offs will be sufficient. Other times, they may not be.

If you can establish a status quo that works well for multiple parties, then you have a chance at getting a large enough group to create a nucleus around that standard.

And in time, if the companies benefit, those standards will expand. Companies that may not have been okay with the trade-offs before may now see the benefit of working within this standard protocol.

That’s because everyone sits on a different continuum of change, so you have to be aware of that and factor it into your process.

Innovators and early adopters cannot drive the solutions you create toward their own interests. So you have to keep the people who aren’t in the room in mind. Because creating the initial protocols and the solution isn’t the end of the story.

The book on blockchain and establishing protocols has certainly not been written. And what we use it for today is a fraction of what we’ll be using it for once the technology is more established.

Thank you for reading!

Want to learn more? Get in touch with the Chronicled team here.