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Thinking in Bets: Making Smarter Decisions When You Don’t Have all the Facts by Annie Duke

poker leadership

Annie Duke retired in 2012, after making over $4m dollars playing professional poker. She is the only woman to have ever won the World Series of Poker Tournament of Champions and the NBC National Heads-Up Poker Championship. As a poker player (and teacher) myself, she is the stuff of legend. But don’t worry, in order to learn from this book, you don’t have to have ever played a hand of cards. Basically, she’s played millions and millions of hands so you don’t have to. It also helps that she is completing her doctoral work in cognitive psychology.

This book is how to make better-informed decisions when you don’t have all of the information. 

During the course of a poker game, a player needs to make hundreds of decisions quickly without knowing all of the facts. You don’t know what cards your opponents are holding, you don’t know which cards are going to be turned over to determine the winner and you don’t know how the other players at the table will bet or play. These decisions all need to be made in every hand in quick succession. By understanding how to train your brain to have quick intelligent discussions while considering the probability of the outcome of those choices, you can apply those processes to decisions in other areas of your life.

Duke’s insight on how humans depend on results is fascinating and her methods of storytelling involve examples from The Princess Bride and The Hills (seriously). The results come from when we conflate the outcome with whether or not the original decision was initially a good or bad decision. The circumstances that led up to the decision could all be seen as logical and correct but if there is a bad outcome, we automatically accept blame and assume that the decision was wrong. Hindsight bias means that when telling the story above — because of the outcome — we automatically tell it as a failure. Whereas every time the outcome is good, even if the decision-making process was flawed and incorrect, we tell it as a success. 

We can make bad decisions without consequence, for example, speeding but getting home without having an accident. Or good decisions that have bad outcomes, driving at the speed limit and getting hit by a drunk driver. In all situations, there are bits we can control with skill and bits that are determined by luck or other people. Figuring out how much of every scenario is skill and how much is luck or external forces allows you to analyse situations with better clarity.

With a poker player’s hat on, we should use probability to determine which of the scenarios would likely play out in the most beneficial way. Generally, in every poker hand, thinking about what other players have and what their move would likely be, determines what you will bet and how you will react. Great poker players are thinking not only what their opponents' next move is, but the four rounds after that. It makes a lot of sense to start looking at your decisions and the ramifications of those decisions and the trickle-down effect of each one. 

Duke also lets us know that we need to migrate to a more nuanced view of right and wrong — as humans we like being right. We like feeling like we had the right answer and anything outside of that is wrong, but in reality, very little is 100 percent right or 100 percent wrong. From a school perspective, saying, “I’m not sure [of the answer]” equates to being wrong. But in real-life scenarios, honestly saying, “I’m not sure” actually opens up more possibilities. It means that no answer is necessarily going to be right, and none will be wrong all of the time.

Critically assessing your behaviour with a peer group can be hugely influential to your future self and the decisions they make. If you invest your time and efforts into establishing this type of peer group, it should have at least two other members — one to disagree and one to referee. The diversity of opinions in your critical group — or ‘decision pod’ — as Duke refers to them is crucial.

The group should be focused on accuracy, accountability and openness to a diversity of ideas.  Don’t have an echo chamber or “yes” women that will just tell you what you want to hear. This is not an easy process but can really change how you challenge your own bias and you can be as equally important in their growth.

Interestingly, if you know that you are going to have to dissect your situation and the way you act within a set of circumstances, you end up with two voices in your ear — each saying how they would play it, which can create a pause and open up other possible outcomes. Just knowing you will have to recount the situation to a critical group later can change how you face the problem in front of you. 

I thought this book would be more about poker strategy but it has left me with a number of new strategies to examine my thought and decision-making process, as well as how to establish my own decision pod and some new long-term goals. Plus, I can see how I can use visualisation and gradients of right and wrong in order to get there. Hopefully, my poker game will improve along the way as a bonus!

 

Jamie Klingler is the founder of experiential brand marketing and events company Creative Influence Alliance, and a poker player and teacher.