Annie Duke on Thinking in Bets, Part 9

In her book, Thinking in Bets: Making Smarter Decisions When You Don’t Have All the Facts, Annie Duke draws on examples from business, sports, politics, and poker to share tools anyone can use to embrace uncertainty and make better decisions.

In the chapter, “Adventures in Mental Time Travel,” Annie Duke discusses the technique of recruiting out past-self and future-self to help our present-self in the decision-making process. These are some of my favorite concepts and takeaways from reading the book.

“Reconnaissance: mapping the future”

For us to make better decisions, we need to perform reconnaissance on the future. If a decision is a bet on a particular future based on our beliefs, we should consider what those possible futures might look like before we place a bet.

Scenario planning is a prominent example of scouting out the future. We should always be asking ourselves the questions, “What are the possible futures? What are the probabilities of those possible futures?”

By doing the hard work of reconnaissance, we can position ourselves better with the following benefits. First, we remind ourselves that the future is uncertain and to have a realistic view of the world. Second, we will be better prepared for how we are going to respond to different outcomes. Reconnaissance can make us more agile.

Third, anticipating the range of outcomes can keep us from unproductive acts of regret when a particular future happens. Finally, we are less likely to fall prey to resulting or hindsight bias by mapping out the potential futures and possibilities.

“Backcasting: working backward from a positive future”

There are two ways of advance thinking: standing at the beginning and looking forward or standing at the end and looking backward. The second approach is much more effective.

Forecasting the future from where we stand can be daunting. From the vantage point of the present, it is hard to see past the next step. We get a sense that the present the immediate future loom large, with anything beyond that fuzzy and losing focus.

When we identify the goal and work backward from the journey’s end to “remember” how we got there, research has shown that we do better. Imaging a successful future and backcasting is a useful approach for identifying necessary steps for reaching our goals.

“Premortems: working backward from a negative future”

Like backcasting, working backward from the end can also help us to imagine an unfavorable future. Backcasting and premortem complement each other as we must always account for both positive and negative outcomes.

Despite the popular wisdom that we achieve success through positive visualization, it turns out that incorporating negative visualization makes us more likely to achieve our goals. A premortem is a healthy form of organized skepticism. The approach gives us permission and freedom for dissent. Think of premortem as acting as our own red team.

Imagine both positive and negative futures allow us to plan and prepare for a wider variety of challenges. Both the likelihood of positive and negative futures must add up to 100% since the positive space of backcasting and the negative space of premortem must still fit into one finite continuum.

Once we decide and one of those possible futures happens, we cannot discard all that work, even if it included work on ends that did not occur. Forgetting about an unrealized future can be dangerous to good decision-making.