Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

With 26 seconds left and behind by four at the Patriots' one-yard line in Super Bowl XLIX, Seahawks coach Pete Carroll made one of the most contentious choices in football history: he signalled for a throw rather than a handoff to his star running back. The Seahawks lost when the throw was intercepted. Critics called it the dumbest play in history. Was the call, however, really so awful? Or did Carroll really make a brilliant decision that was marred by misfortune?

Not every choice, no matter how wise, will always result in the ideal situation. There's always a chance component that you have no control over, and there's always information that's out of sight. Thus, thinking in bets is the secret to long-term success (and preventing yourself from worrying yourself to death): How certain am I? What outcomes are there that may occur? Which option has the best chance of succeeding? Did I fall into the unfortunate 10% using the 90% successful strategy? Or is it more likely that my achievement is the result of bad luck than wise choices?

Annie Duke, a former World Series of Poker winner who is now a business consultant, shares strategies for embracing uncertainty and improving decision-making with examples from the worlds of business, politics, sports, and, of course, poker. Saying "I'm not sure" is hard for most individuals in a culture that encourages appearances of confidence. Professional poker players, however, are aware that good judgements don't always result in good things, and poor ones don't necessarily result in terrible things.

By shifting your thinking from a need for certainty to a goal of accurately assessing what you know and what you don't, you'll be less vulnerable to reactive emotions, knee-jerk biases, and destructive habits in your decision making. Over time, you'll become more self-assured, composed, understanding, and prosperous.