Since 1994, Annie Duke has dominated the world of poker. She quickly established herself as one of the best players in the world, and won the 2004 No-Limit Texas Hold’em invitation-only WSOP Tournament of Champions– by beating nine poker legends.
I recently attended a conference at which Duke keynoted. Her topic was decision-making. At first I thought, “Really? A poker player with something to say about decision-making? “
Well, yes, as Duke pointed out, decision-making in poker and business is similar.
Consider first that decision-making during poker occurs under conditions of uncertainty. In other games such as chess, all the potential moves are right in front of you, but in poker everyone is dealt cards face down. Second, you can predict with only some probability which cards are still to come.
As a result, a poker player makes decisions with incomplete information. In other words, takes calculated risks. Sound familiar?
So what are the business implications of you and your staff making decisions in such an environment? Well, obviously failure on one extreme or a big payoff on the other.
Think about this: When an employee makes a mistake or doesn’t get the result you desire, do you chalk it up to the person being a “bad player”? If you do that consistently, employees quickly learn, “If I ever ‘lose,’ my boss is going to think I’m a bad player.” You create a conservative culture in which employees go for the sure thing, for the proven result. Both they and your company experience limited success, but innovation is stifled. And the big payoff remains out of reach.
Remember, it’s really more about how you deal with the cards than the cards you’re dealt.