Collective inactivity because of personal cost benefit analysis stymies many departmental initiatives

A number of law department initiatives stumble because the lawyers don’t do their part. Whether the initiative be to contribute documents to a repository, write FAQs for an intranet, run a Center of Excellence, reduce outside counsel fees, take advantage of software, hire diverse candidates, or put evaluations into a database, the underlying cause of reluctance is a calculation. They figure that the individual benefit to them does not outweigh the potential cost of action. By “cost of action” I mean their personal contribution to the effort is the action and the downside risk if something goes wrong is the cost.

Cass R. Sunstein, Infotopia: How Many Minds Produce Knowledge (Oxford 2006) at 69, refers to this as a standard “collective action problem.” If an in-house attorney knows something about a problem, to share that knowledge gains only a bit for her, although possibly a whole lot for the department and its client. If knowledge she shares boomerangs, however, she suffers disproportionately. Thus, “each person, following his or her rational self-interest, will tell the group less than it needs to know.” Or will contribute less than the group would expect and like to have (See my post of March 5, 2005: altruism does not overcome reluctance to contribute to knowledge management efforts; Dec. 21, 2005: disappointing levels of contributions to intranets; April 14, 2005: erratic evaluations of outside counsel; June 15, 2006: collective good not sufficient to motivate action; June 21, 2006: technology languishes if it offers mostly collective gain; March 16, 2008: game theoretic view of individual self-serving; Oct. 22, 2008: self-sacrifice for the collective good with knowledge management; Aug. 10, 2009: dispersed benefits for pirates of having slaves onboard, but individualized loss; and Sept. 28, 2009: competitiveness dampens collaboration in-house.).

The upshot? Good programs wither because few people pitch in much. It’s a collective inaction problem.

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