Thinking in Bets Quotes

“Müller-Lyer illusion to illustrate this.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“consult”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“Drawing”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“One of the things poker teaches is that we have to take satisfaction in assessing the probabilities of different outcomes given the decisions under consideration and in executing the bet we think is best. With the constant stream of decisions and outcomes under uncertain conditions, you get used to losing a lot. To some degree, we’re all outcome junkies, but the more we wean ourselves from that addiction, the happier we’ll be. None of us is guaranteed a favorable outcome, and we’re all going to experience plenty of unfavorable ones. We can always, however, make a good bet. And even when we make a bad bet, we usually get a second chance because we can learn from the experience and make a better bet the next time.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“When we see how much negative space there really is, we shrink down the positive space to a size that more accurately reflects reality and less reflects our naturally optimistic nature.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“when we backcast and imagine the things that went right, we reveal the problems if those things didn’t go right. Backcasting doesn’t, therefore, ignore the negative space so much as it overrepresents the positive space. It’s in our optimistic nature (and natural in backcasting) to imagine a successful future. Without a premortem, we don’t see as many paths to the future in which we don’t reach our goals. A premortem forces us to build out that side of the tree where things don’t work out. In the process, we are likely to realize that’s a pretty robust part of the tree. Remember, the likelihood of positive and negative futures must add up to 100%. The positive space of backcasting and the negative space of a premortem still have to fit in a finite amount of space.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“Conducting a premortem creates a path to act as our own red team. Once we frame the exercise as “Okay, we failed. Why did we fail?” that frees everyone to identify potential points of failure they otherwise might not see or might not bring up for fear of being viewed as a naysayer. People can express their reservations without it sounding like they’re saying the planned course of action is wrong. Because of that, a planning process that includes a premortem creates a much healthier organization because it means that the people who do have dissenting opinions are represented in the planning.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“A premortem is an implementation of the Mertonian norm of organized skepticism, changing the rules of the game to give permission for dissent. Being a team player in a premortem isn’t about being the most enthusiastic cheerleader; it’s about being the most productive heckler. “Winning” isn’t about the group feeling good because everyone confirms their (and the organization’s) narrative that things are going to turn out great. The premortem starts with working backward from an unfavorable future, or failure to achieve a goal, so competing for favor, or feeling good about contributing to the process, is about coming up with the most creative, relevant, and actionable reasons for why things didn’t work out.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“For the company with the three-year plan to double market share, the premortem headline is “Company Fails to Reach Market Share Goal; Growth Again Stalls.” Members of the planning team now imagine delays in new products, loss of key executives or sales or marketing or technical personnel, new products by competitors, adverse economic developments, paradigm shifts that could lead customers to do without the product or rely on alternatives not on the market or in use, etc.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“A premortem is an investigation into something awful, but before it happens.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“Let’s say an enterprise wants to develop a three-year strategic plan to double market share, from 5% to 10%. Each person engaged in the planning imagines holding up a newspaper whose headline reads “Company X Has Doubled Its Market Share over the Past Three Years.” The team leader now asks them to identify the reasons they got there, what events occurred, what decisions were made, what went their way to get the enterprise to capture that market share. This enables the company to better identify strategies, tactics, and actions that need to be implemented to get to the goal. It also allows it to identify when the goal needs to be tweaked. Backcasting makes it possible to identify when there are low-probability events that must occur to reach the goal. That could lead to developing strategies to increase the chances those events occur or to recognizing the goal is too ambitious. The company can also make precommitments to a plan developed through backcasting, including responses to developments that can interfere with reaching the goal and identifying inflection points for re-evaluating the plan as the future unfolds.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“When we identify the goal and work backward from there to “remember” how we got there, the research shows that we do better. In a Harvard Business Review article, decision scientist Gary Klein summarized the results of a 1989 experiment by Deborah Mitchell, J. Edward Russo, and Nancy Pennington. They “found that prospective hindsight—imagining that an event has already occurred—increases the ability to correctly identify reasons for future outcomes by 30%.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“Imagining the future recruits the same brain pathways as remembering the past. And it turns out that remembering the future is a better way to plan for it. From the vantage point of the present, it’s hard to see past the next step. We end up over-planning for addressing problems we have right now. Implicit in that approach is the assumption that conditions will remain the same, facts won’t change, and the paradigm will remain stable. The world changes too fast to assume that approach is generally valid. Samuel Arbesman’s The Half-Life of Facts makes a book-length case for the hazards of assuming the future is going to be like the present.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“For the decision swear jar, we identify the language and thinking patterns that signal we are veering from our goal of truthseeking. When we find ourselves using certain words or succumbing to the thinking patterns we are trying to avoid because we know they are signs of irrationality, a stop-and-think moment can be created. You can think about this as a way to implement accountability”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“Now imagine if you had gone for that night of blackjack a year ago. When you think about the outcomes as having happened in the distant past, it is likely your preference for the results reverses, landing in a more rational place. You are now happier about the $100 win than about the $100 loss. Once we pull ourselves out of the moment through time-traveling exercises, we can see these things in proportion to their size, free of the distortion caused by whether the ticker just moved up or down.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“The way we field outcomes is path dependent. It doesn’t so much matter where we end up as how we got there. What has happened in the recent past drives our emotional response much more than how we are doing overall. That’s how we can win $100 and be sad, and lose $100 and be happy. The zoom lens doesn’t just magnify, it distorts. This is true whether we are in a casino, making investment decisions, in a relationship, or on the side of the road with a flat tire. If we got a big promotion last week and have a flat tire right now, we are cursing our lives, complaining about how unlucky we are. Our feelings are not a reaction to the average of how things are going. We feel sad if we are breaking even (or winning) on an investment that used to be valued much higher. In relationships, even small disagreements seem big in the midst of the disagreement. The problem in all these situations (and countless others) is that our in-the-moment emotions affect the quality of the decisions we make in those moments, and we are very willing to make decisions when we are not emotionally fit to do so.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“We can use our past- and future-selves to pull us out of the moment and remind us when we’re watching the ticker, looking at our lives through that lens on extreme zoom. When we view these upticks and downticks under the magnification of that in-the-moment zoom lens, our emotional responses are, similarly, amplified. Like the flat tire in the rain, we are capable of treating things that will have little effect on our long-term happiness as having significant impact. Our decision-making becomes reactive, focused on off-loading negative emotions or sustaining positive emotions from the latest change in the status quo. We can see how this can result in self-serving bias: fielding outcomes to off-load the negative emotions we feel in the moment from a bad outcome by blaming them on luck and sustaining the positive emotions from good outcomes by taking credit for them. The decisions driven by the emotions of the moment can become a self-fulfilling prophecy, degrading the quality of the bets we make, increasing the chances of bad outcomes, and making things worse.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“The problem isn’t so much whether regret is an unproductive emotion. It’s that regret occurs after the fact, instead of before. 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 occurred before a decision instead of after, the experience of regret might get us to change a choice likely to result in a bad outcome. Then we could embrace Thoreau’s view and harness the power of regret because it would serve a valuable purpose. It would be helpful, then, if we could get regret to do some time traveling of its own, moving before our decisions instead of after them. That way, regret might be able to keep us from making a bad bet. In addition, it wouldn’t, as Nietzsche implied, rear its head later by causing us to make a remorse-fueled second mistake.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“Hall of Fame football coach John Madden, in a documentary about Vince Lombardi, told a story about how, as a young assistant coach, he attended a coaching clinic where Lombardi spoke about one play: the power sweep, a running play that he made famous with the Green Bay Packers in the 1960s. Lombardi held the audience spellbound as he described that one play for eight hours. Madden said, “I went in there cocky, thinking I knew everything there was to know about football, and he spent eight hours talking about this one play. . . . I realized then that I actually knew nothing about football.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“We treat outcomes as good signals for decision quality, as if we were playing chess. If the outcome is known, it will bias the assessment of the decision quality to align with the outcome quality.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“I developed an exercise to practice and reinforce universalism. When I had the impulse to dismiss someone as a bad player, I made myself find something that they did well. It was an exercise I could do for myself, and I could get help from my group in analyzing the strategies I thought those players might be executing well. That commitment led to many benefits.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“If you want to pick a role model for designing a group’s practical rules of engagement, you can’t do better than Merton. To start, he coined the phrase “role model,” along with “self-fulfilling prophecy,” “reference group,” “unintended consequences,” and “focus group.” He founded the science of sociology and was the first sociologist awarded the National Medal of Science.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“Accountability, like reinforcement of accuracy, also improves our decision-making and information processing when we are away from the group because we know in advance that we will have to answer to the group for our decisions.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“We don’t win bets by being in love with our own ideas. We win bets by relentlessly striving to calibrate our beliefs and predictions about the future to more accurately represent the world. In the long run, the more objective person will win against the more biased person. In that way, betting is a form of accountability to accuracy. Calibration requires an open-minded consideration of diverse points of view and alternative hypotheses. Wrapping all that into your group’s charter makes a lot of sense.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“In addition to accountability and an interest in accuracy, the charter should also encourage and celebrate a diversity of perspectives to challenge biased thinking by individual members. Jonathan Haidt, a professor at New York University’s Stern School of Business, is a leading expert in exploring group thought in politics. Haidt, in his book The Righteous Mind: Why Good People Are Divided by Politics and Religion, built on Tetlock’s work, connecting it with the need for diversity. “If you put individuals together in the right way, such that some individuals can use their reasoning powers to disconfirm the claims of others, and all individuals feel some common bond or shared fate that allows them to interact civilly, you can create a group that ends up producing good reasoning as an emergent property of the social system. This is why it’s so important to have intellectual and ideological diversity within any group or institution whose goal is to find truth.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“Lerner and Tetlock offer insight into what should be included in the group agreement to avoid confirmatory thought and promote exploratory thought. “Complex and open-minded thought is most likely to be activated when decision makers learn prior to forming any opinions that they will be accountable to an audience (a) whose views are unknown, (b) who is interested in accuracy, (c) who is reasonably well-informed, and (d) who has a legitimate reason for inquiring into the reasons behind participants’ judgments/choices.” Their 2002 paper was one of several they coauthored supporting the conclusion that groups can improve the thinking of individual decision-makers when the individuals are accountable to a group whose interest is in accuracy.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“This makes us more compassionate, both toward ourselves and others. Treating outcome fielding as bets constantly reminds us outcomes are rarely attributable to a single cause and there is almost always uncertainty in figuring out the various causes.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“In the movie, the matrix was built to be a more comfortable version of the world. Our brains, likewise, have evolved to make our version of the world more comfortable: our beliefs are nearly always correct; favorable outcomes are the result of our skill; there are plausible reasons why unfavorable outcomes are beyond our control; and we compare favorably with our peers. We deny or at least dilute the most painful parts of the message. Giving that up is not the easiest choice. Living in the matrix is comfortable. So is the natural way we process information to protect our self-image in the moment. By choosing to exit the matrix, we are asserting that striving for a more objective representation of the world, even if it is uncomfortable at times, will make us happier and more successful in the long run.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“The benefits of recognizing just a few extra learning opportunities compound over time. The cumulative effect of being a little better at decision-making, like compounding interest, can have huge effects in the long run on everything that we do.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

“Thinking in bets triggers a more open-minded exploration of alternative hypotheses, of reasons supporting conclusions opposite to the routine of self-serving bias. We are more likely to explore the opposite side of an argument more often and more seriously—and that will move us closer to the truth of the matter. Thinking in bets also triggers perspective taking, leveraging the difference between how we field our own outcomes versus others’ outcomes to get closer to the objective truth. We know we tend to discount the success of our peers and place responsibility firmly on their shoulders for their failures. A good strategy for figuring out which way to bet would be to imagine if that outcome had happened to us.”
― Annie Duke, Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts