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Annie Duke’s “Thinking In Bets”

Annie Duke is best known as a professional poker player and author of poker oriented books, but in “Thinking In Bets” retraces her academic history — it’s a business book, a strategy book, a behavioral psychology book, an organizational effectiveness book and of course has residual elements of a poker book at its core. It is, quite simply, one of the best business books and actionable management books I have read in years — it’s up there with Peter Thiel’s “Zero to One.” If you’re wondering what Pete Carroll’s pass play call at the end of the 2014 Super Bowl, Steve Bartman’s interference in the Cubs playoff game that eventually forced him out of Chicago, legal strategists, poker professional Phil Ivey and corporate planning have in common, buy and read, then re-read Duke’s book.

I digested an advanced reader’s copy of the book, and it’s one of the few things I’ve annotated as I went, making notes that I’ve used in staff meetings and 1:1 discussions in the last few weeks. The whole thing reads the way you’d expect and want; it’s like talking to Annie Duke in your living room with the right blend of snark, deep insights wrapped in powerful examples, and force. I’ve read several dozen business and strategy books, and most of them paint generic pictures of leadership or organizational behavior – “Thinking In Bets” actually lays out a map for where your decision making processes (and as a result, leadership and organizational acumen) are deficient, and how to build a self-improvement plan to address those shortcomings. It’s a bit of personal coaching in a purely positive direction, which is as rare as it is helpful.

Here are just some of the things I took away:

  • Resist the urge to associate bad outcomes (Seahawks losing to the Patriots in the Super Bowl) with bad decisions (Pete Carroll’s play call was backing by solid data). My concern is that as we make continued investments in data science and analytics, we will tend to use that data for “resulting” rather than supporting the quality of decisions, and we’ll end up with many fewer aggressive or game-changing decisions.

  • We can improve the way in which we collect and vet data, and that process may challenge some of our assumptions (one of my immediate reactions was that adopting this line of thinking actually addresses the closely held belief firewall that Matt Inman addresses in his “belief” comic)

  • Finding a peer group that can help you build a non-confrontational, non-threatening decision review team will improve your executive function and “network leadership” (which explains why there are CxO councils, nerd exchanges, and even why hackathons are popular — they are immediate and safe spaces in which to share decisions ranging from corporate strategy to Javascript toolkit choice)

  • Some decision paths have hysteresis – even if you end up at the same outcome, the path you take to get there may be different and therefore your valuation of the outcome is different. The example Duke dissects is winning $1,000 and then losing $900 of it back, versus losing $1,000 and winning $900 back — you’re likely to be happier you “only lost” $100 versus the outcome where you “only won” $100.

  • We have to imagine the future impacts of our decisions, which involves scenario planning, careful consideration of risks and future inputs (information) we may or may not see, and some of that future-proofing involves changing our reward valuation such that we are able to break consistently bad or ill-informed decision making processes.

    Sound like a lot? It is. It’s a dense book. I read it in parallel with a some “lighter” science fiction because I found I had to turn over some of the ideas in my mind and think about both how I’ve personally exhibited some of the impairing behaviors, and how I could better use these strategies in my professional and personal domains.

    Full disclosure: My group in my day job has paid Annie Duke as a speaker, an event at which I first heard some of these ideas, and I have played in her How I Decide Charity Poker Ball in previous years, but I received no compensation or remuneration for this review other than a hardcover copy of this book.