303. Thinking in Bets: Making Smarter Decisions When You Don’t Have All the Facts
Rating: ☆☆☆☆
Recommended by:
Author: Annie Duke
Genre: Non Fiction, Psychology, Self Improvement, Science
288 pages, published February 6, 2018
Reading Format: Book
Summary
In Thinking in Bets, Annie Duke, a former World Series of Poker champion turned business consultant, lays out the case for treating your decisions as bets and how to improve the odds of making a better decision. Duke conveys her message with a compelling mix of scientific research, interesting anecdotes from the domains of business, sports, politics, poker and her own personal experience. She counsels that we should avoid “resulting,” i.e. evaluating a decision only on the basis of the result rather than the process that went into making the decision. Even the best decision doesn’t result in the best outcome every time. There’s always an element of luck that you can’t control and there is always information that is hidden from view. Her approach is to ask several questions: How sure am I? What are the possible ways things could turn out? What decision has the highest odds of success? Did I land in the unlucky 10% on the strategy that works 90% of the time? Is my success attributable to dumb luck rather than great decision making?
Quotes
“What makes a decision great is not that it has a great outcome. A great decision is the result of a good process, and that process must include an attempt to accurately represent our own state of knowledge. That state of knowledge, in turn, is some variation of “I’m not sure.”
“Thinking in bets starts with recognizing that there are exactly two things that determine how our lives turn out: the quality of our decisions and luck. Learning to recognize the difference between the two is what thinking in bets is all about.”
“Improving decision quality is about increasing our chances of good outcomes, not guaranteeing them.”
“In most of our decisions, we are not betting against another person. Rather, we are betting against all the future versions of ourselves that we are not choosing.”
“…thinking in bets is not a miracle cure. Thinking in bets won’t make self-serving bias disappear or motivated reasoning vanish into thin air. But it will make those things better. And a little bit better is all we need to transform our lives.”
“Certainly, in exchange for losing the fear of taking blame for bad outcomes, you also lose the unadulterated high of claiming good outcomes were 100% skill. That’s a trade you should take. Remember, losing feels about twice as bad as winning feels good; being wrong feels about twice as bad as being right feels good. We are in a better place when we don’t have to live at the edges. Euphoria or misery, with no choices in between, is not a very self-compassionate way to live.”
“As Nietzsche points out, regret can do nothing to change what has already happened. We just wallow in remorse about something over which we no longer have any control. But if regret happened before a decision instead of after, the experience of regret might get us to change a choice likely to result in a bad outcome.”
My Take
Thinking in Bets is a page turner of a book with some valuable content to get you thinking about how you make decisions. Annie Duke has done her homework which is reflected her discussion of the current scientific research. She is also a strong writer and this book was hard to put down. My biggest takeaway was to try to avoid “resulting,” that is, the tendency to evaluate decisions solely on the basis of the result achieved. Sometimes we get lucky or unlucky. We shouldn’t take too much credit with the former and we shouldn’t beat ourselves up too much with the latter. Appreciating the role of luck and our ingrained biases help us to make better decisions and live with both the positive and negative results of our decisions with greater equanimity.
