Life is Poker, Not Chess

By John Millen

In business and life we often have to make difficult decisions with limited or conflicting information.

And the decisions we make will be judged based on the results they produce. That seems fair, doesn’t it?

Your answer is likely “yes” and this points to a problem that we humans have in evaluating and making decisions.

Annie Duke, a poker professional, says she and other players call this tendency “resulting.” That means we judge a decision based on its results, which are subject to good or bad luck, not the true quality of the choice we made.

That’s why she says life is poker, not chess.

In her national bestseller, Thinking in Bets: Making Smarter Decisions When You Don’t Have All the Facts, Duke explains that chess is an orderly, skill-based game where decisions are easily evaluated.

“When I first started playing poker,” she writes, “more experienced players warned me about the dangers of resulting, cautioning me to resist the temptation to change my strategy just because a few hands didn’t turn out well in the short run.”

Duke says decisions in life are more like poker, where a player makes choices affected by limited information, active competitors and the whim of luck. 

Duke explains the hazards of resulting:

Take a moment to imagine your best decision in the last year. Now take a moment to remember your worst decision. 

I’m willing to bet that your best decision preceded a good result and the worst decision proceeded a bad result.

This is a safe bet for me because resulting isn’t just something we do from afar. Monday Morning Quarterbacks are an easy target, as our writers and bloggers providing instant analysis to mass audiences. 

But, as I found out from my own experiences in poker, resulting is a routine thinking pattern that bedevils all of us. Drawing an overly tight relationship between results and decision quality affects our decisions every day potentially with far-reaching, catastrophic consequences.

'Dumbest call'

Duke uses one of the most controversial decisions in sports history to illustrate her point. In 2015, the Seattle Seahawks were on the one-yard line of the New England Patriots with a second-down chance to win the game. With a super strong running back, everyone expected a handoff, but coach Pete Carroll called for a short pass.

The pass was intercepted and the Patriots went on to win the Super Bowl. A few lonely voices supported the decision, citing for instance that passes from the one-yard line were only intercepted 2% of the time, but most agreed with the headlines:

Washington Post: “Worst Play-Call in Super Bowl History”
 
USA Today: “What was Seattle Thinking with Worst Play Call in NFL History?”
 
FoxSports.com: “Dumbest Call in Super Bowl History Could Be the Beginning of the End for Seattle Seahawks.”

Duke writes that “Carroll got unlucky…He made a good-quality decision that got a bad result. Pete Carroll was a victim of our tendency to equate the quality of a decision with the quality of its outcome.”

We may not have the Super Bowl on the line, but all of us make bets in our business and personal lives. Based on our beliefs and experiences, we make the choice we believe will result in the best outcome for our future selves. Yet we can never be certain. Here are three ways to make better decisions, regardless of the results:three ways to make better decisions, regardless of the results:

1. Calibrate your beliefs

Duke encourages us to develop the skill in life “to be a better belief calibrator, using experience and information to more objectively update our beliefs to more accurately represent the world.” To learn more about overcoming your mental biases read what I wrote about how to Challenge Your Beliefs.

2. Redefine 'wrong' decisions 

Try Duke’s exercise yourself: What was your worst decision of the past year? What was your best decision of the past year?

If your answers are about results, it might be time to redefine what you view as “wrong” decisions versus poor outcomes. You may also find that “bad” decisions by you or your team were really just bad luck with bad results.

3. Reward yourself for good decisions with poor results

I recommend that you develop the habit of recognizing and rewarding good decisions that had poor outcomes for yourself or your team. This practice is akin to encouraging yourself and others to take calculated risks and accept failure as the price of admission.

It's a mental attitude that needs to be developed by continual reinforcement.

Give these practices a try. Soon you'll be making better quality decisions with better outcomes and, more importantly, you'll know the difference.

John