In a world where outcomes are often uncertain and information incomplete, HOW CAN WE MAKE BETTER DECISIONS? Annie Duke, a former professional poker player turned decision-making expert, offers a compelling answer in her book “Thinking in Bets“. Drawing on her experience at the poker table and her academic training in cognitive psychology, Duke presents a powerful framework for improving decision-making in business, leadership, and everyday life.
The central premise of Annie Duke’s ideas is that DECISIONS ARE BETS. At the heart of Duke’s philosophy is a simple yet transformative idea: EVERY DECISION IS A BET ON A FUTURE OUTCOME. We rarely have complete information, and luck often influences the results we obtain. Therefore, JUDGING DECISIONS SOLELY BY THEIR OUTCOMES IS A FLAWED APPROACH. Along these lines, Duke emphasizes that
“What makes a decision great is not that it has a great outcome. A great decision is the result of a good process.”
This mindset shift—from outcome-based thinking to process-based thinking—encourages us to evaluate the quality of our decisions based on the information available at the time, not the final outcome.
In this sense, we often assume that a good outcome means a good decision and a bad outcome means a bad decision. This is a cognitive bias that can lead to poor learning and flawed strategies. This is known as the OUTCOME BIAS TRAP. As Annie Dukeoften says,
“We quickly take credit for good outcomes and blame bad luck on bad ones.”
In this way, by separating the quality of decisions from the quality of outcomes, we can better analyze our choices and improve over time.
Duke also encourages us to EMBRACE UNCERTAINTY AND THINK IN TERMS OF PROBABILITIES RATHER THAN CERTAINTIES. This probabilistic thinking helps us stay flexible, open-minded, and less emotionally attached to being right. This is what Duke calls THINKING IN PROBABILITIES.
Furthermore, Duke asserts that in both poker and life, OUTCOMES ARE INFLUENCED BY A COMBINATION OF SKILL AND LUCK. Recognizing this helps us avoid overconfidence and fosters humility in our judgments.
Duke also recommends surrounding ourselves with people who challenge our thinking and hold us accountable. Duke advocates for the formation of “truth-seeking groups”: groups that prioritize accuracy over ego. Because as she says,
“Accountability feels like a confrontation, but it’s actually a gift.”
Additionally, Annie swears by KEEPING A DECISION JOURNAL, as it can help us track our reasoning, learn from past decisions, and calibrate our confidence levels more accurately over time.
For leaders, entrepreneurs, and professionals, Annie Duke’s theories offer a set of practical tools for tackling complexity and ambiguity. Whether you’re launching a new product, hiring a team member, or making strategic investments, adopting a probabilistic mindset can lead to more resilient and adaptive decision-making. It also fosters a culture of learning and psychological safety, where mistakes are viewed as opportunities for growth rather than failures to be punished.
I’ll conclude with a quote from Annie Duke that sums up the essence of her ideas:
“We need to stop treating uncertainty as a villain and start treating it as an ally.”
