Want to Make Smarter Decisions? Think Like a Poker Player
Poker is like life, just without the noise.
At this year’s NeuroLeadership Summit, author and professional poker player Maria Konnikova explained how the game of poker has improved her ability to make uncertain decisions. It’s a skill all leaders can benefit from — in daily interactions and high-stakes scenarios.
“Poker is a circumscribed environment in which your brain is actually learning based on experience,” Konnikova said. Each aspect of a poker game — the wagering, the calculation of probability, the risk — is a microcosm of the corporate environment, she says.
We can categorize the benefits according to three aspects of organizational life.
“When it comes to decision-making we make a lot of mistakes, especially when we are stressed or when we’re in environments that are rapidly changing,” Konnikova said. “There is bias after bias after bias.”
That’s not an indictment on people’s character. The science makes it clear every human brain relies on past experience to make choices. For example, we learn from one-off and extreme events, particularly if they are high in emotional charge, like plane crashes or terrorist attacks. In doing so, we may sample from just a handful of events and overgeneralize to the current situation, wrongly believing they capture the full picture.
Konnikova’s wisdom is that poker removes bias because it forces the player to rely on experiences rooted in the data of past hands. Leaders who think like a poker player when making decisions look to escape their bias, perhaps by seeking out alternative data or gathering a fuller picture of the issue.
Ask for feedback
The advantage of learning from individual poker hands is that players get instant feedback on their play, Konnikova says. Leaders reap the same benefit from implementing a culture of feedback in their organizations.
Regular feedback discussions can help move organizations closer to their goals — be they financial, cultural, or otherwise — than sporadic talks. When employees ask for feedback and expect to receive it, their brains are prepared for negative news.
Being prepared not only minimizes the social threat they may experience but also puts them in the right mental state to process the information they need. A culture of feedback — one in which every employee practices the habit of asking for feedback — allows an organization to course correct early and often on the way to achieving its goals.
Use mental contrasting
In poker, it’s crucial for players to stay rational because taking an overly rosy view of the game can lead to risky play. Leaders can find the same “sweet spot” in their own decision-making through a technique called “mental contrasting.”
When people engage in mental contrasting, they compare the present reality with a possible, desired future. They mentally inhabit that world and try to judge what’s reasonable to expect in terms of risk and reward.
If they are overly optimistic, chances are they will ignore possible downsides. However, if leaders contrast optimistic visions of future success with concrete reflections on the inherent risks, they will more likely be optimistic when it is warranted and cautious when expectations are low.
Dealing with perils and possibilties
Ultimately, the decisions we make at work are largely social decisions, which are inherently risky and uncertain. We can’t know for sure what is going on in other people’s heads. But we can do our due diligence in gathering data, whether it’s quantitative or qualitative, and embracing chances to receive feedback rather than shying away from them.
By learning to think like the world’s best poker players, we can best position ourselves to successfully deal with perils and possibilities in the most optimal manner.