Reforms will always create winners and losers. And the losers will always fight harder than the winners.

Reform, in the context of this post, refers to a change that is good for a group overall, but will impose costs on sub-groups.

That is, the total socialised benefits are greater than the privatised costs. Or put another way, the combined group utility increases, though some sub-group utility decreases.

For example, imagine a new rule where lawyers are required to advertise their win-to-loss ratio. This is arguably good for society – greater information and transparency, more competitive pressures in the supply of legal services, more informed consumer decision-making.* The losers here are low-performing lawyers. All of a sudden, their plainness will be plain for all to see.

Where should one focus their efforts when dealing with the soon-to-be losers?

The options are (a) focus on the benefits of the change or (b) focus on the elects of loss.

(A) is a hard sell. It’s hard to sell the benefits of change to a receiving group that will lose from the change. That is, ‘because of your sacrifice, we all win’ is unlikely to be persuasive.

(B) is the better choice. It involves identifying the points of resistance and addressing those.

So, when change is on the horizon, we can expect the soon-to-be losers to speak up, and we should prioritise efforts to address their pain points over trying to sell the benefits of the change.

* I haven’t thought carefully about the law example. It is just an example.

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