A really interesting TEDx Talk from Rasmus Ankersen on the learnings businesses can take from the viewpoint of a professional gambler. His story starts by eloquently walking us through the rise and dramatic fall of Nokia, who went from 50% global market share to just 3% in less than five years.
Rasmus considers that businesses often fail to talk enough about the psychologically challenges that follow success, referencing Newcastle United’s somewhat freak 2012 rise to 5th in the Premier League after previously sub standards season. The management team response? To reward the head coach and entire team with a historic long, unbreakable 8 year long contract. The following season? Newcastle were almost relegated, they finished 16th.
Rasmus discussed we are often blinded by the common delusion of outcome bias – believing that good results are always the consequence of good decisions or superior decisions. The belief that ‘success turns luck into genius.’
In football there is a good expression, ‘the league table never lies. It assumes once the last game of the season is played, justice prevails.
Rasmus’ references his friendship with Oxford graduate turned gambling professional.
A gambler knows, ‘the league table always lie’.
The TED talk explores that when an organisation fails, we cruise on, we dig for reasons. But when the same organisations are successful we don’t ask those questions, we don’t dig in and ask ‘why this success?’ Is it due to great market conditions, fantastic oil prices, luck?
A good gambler trains his brain to resist the urge to assume good outcomes are because someone acted brilliantly. They look at data and treat success with the same scepticism as they treat failure.
Successful businesses should do too – ask questions, not just when the going gets tough.
I hope, football fan or not, you enjoy the analogy. I certainly did.
Do sign up to my weekly newsletter, Rambling On if you want more articles and musings on interesting stuff for interested people.
Andy.