In this episode, Allison Giddens and I dug into Nassim Nicholas Taleb’s “Fooled by Randomness“.
You can listen to the episode here:
You can find Allison on LinkedIn here.
Full Transcript:
Mickey: Randomness, chance and luck influence our lives and our work more than we realize because of hindsight bias and survivorship bias. In particular, we tend to forget the many who fail. Remember the few who succeed and then create reasons and patterns for their success. Even though it was largely random, mild success can be explainable by skills and hard work, but wild success is usually attributable to variance and luck.
So that was from Nassim Nichols Taleb’s, “Fooled by Randomness” and here today to discuss it with me is Allison Giddens. So Allison, welcome.
Allison: Hey, thanks for having me.
Mickey: You’re welcome. I’m glad to have you here. So you picked this book out of my list. So yeah, tell me your thoughts and why you wanted to go with this one today.
Allison: Well, I picked this one partially because it’s one of those books I kind of always come back to. Um, and I always have to kind of remind myself certain concepts or certain themes that popped up. And I think you, you covered some of those just in the opening quote alone. I
Mickey: hmm.
Allison: that the notion that, um, you know, you, you tend to think, Oh, that’s so random or gosh, that’s such [00:01:00] a, a funny happenstance. But when you really get down to it, you think, okay, is it truly random or is it something I’m just happened to noticing because of cognitive bias or, or whatnot?
Mickey: very true. Yeah, there’s so many different ways to take this. This comes up for me a lot in business because Ali and I have been in business for 15 years. And people say, how did you guys like know you’re the right partners for each other for the business? And how did, like, it was total luck. Like, We could have just as easily been bad parties.
I don’t have any great lessons there because I see, I mean, certainly we’ve worked hard at it and stuff, but I see the role that luck played in doing that. And it’s frustrating in some ways, but I’m very thankful in a lot of ways. So it’s worked out well in that regard.
Allison: Yeah, yeah, and that sounds kind of very similar to my business partner and I. It’s kind of chance that we ended up the way we are, too. He had been here at Win-Tech for 30 years, and I’d been here 17, so we knew each other long enough, but when the opportunity came to buy our company, it was kind of like, Oh, we’re both in the same place at the same time.
Mickey: Yep. Yeah, it can be that way. And again, yeah, I get frustrated with that. Even like with sales and stuff too. Like it’s [00:02:00] who I happen to be sitting next to an event that needs a new website. Like I don’t want to sell stuff because of who I happen to sit by, but that’s how it goes sometimes. And that’s, that’s how we lose jobs sometimes too.
Cause we would have been a better fit, but someone else happened to be in the right place at the right time and got lucky. And that’s just kind of how, kind of how things go. So it’s all good. Um, another hope so many areas I want to try to cover with this book and certainly, yeah, lead us where you want to think you want to go.
But one thing I love that I saw that I see a lot lately is, uh, this is a quote from the book here. They say, quote, people do not realize that the media is paid to get your attention for a journalist. Silence rarely surpasses any word. So I’ll see people on social media saying, Oh, look out. They manufactured this, this event to get something new in the news.
I’m like, no, they’re always going to find something new in the news. Like, that’s what their job is. And so things again, sort of, you know, are sort of random to get in the news, but it’s not manufactured. I don’t think they have to come up with something to say and they pick the biggest story. There’s, I don’t believe there’s a big conspiracy to make another big story.
There’s just always stories coming, you know?
Allison: Yes, yes, and there’s I think there was a point in the book where they talk about the [00:03:00] ratio of undistilled information To distilled is rising
Mickey: Okay.
Allison: so they talk about, and I think that’s a kind of a piece of the media conversation, right, like you, you want more distilled information that the concepts that kind of stand the test of time,
Mickey: Yep.
Allison: um, rather than these reactionary opinions or these, you know, uh, these headlines that grab you and you’re like, Oh, gosh.
To, to your point, either, oh, they’re just manufacturing something, or gosh, they’re blowing something out of control or out of proportion. Um, whereas if you, if you do have that cognitive bias, now you’ve already made your mind up as to whether or not that headline is legit.
Mickey: I
Allison: makes me think of, I don’t know if you’re, if you, uh, watch Tokyo Vice.
Mickey: did not. No,
Allison: Max. So it’s, it’s kind of based on a true story about a journalist who, uh, from America who ends up going to Tokyo and wants to be a journalist and wants to understand the Tokyo underbelly and Yakuza and all that kind of, you know, [00:04:00] it’s a crime drama.
Mickey: Gotcha.
Allison: it’s fascinating to me when he sits down at the computer in Japan and is working on a story and the, the, the media or the, the newspaper he works for are they’re very strict on your providing the details of the facts.
Mickey: Gotcha.
Allison: it’s, it’s almost like when you focus on the facts, just the who, what, where, why, how, it gets the, it gets probability. It kind of. To me, it diminishes the of probability. Like,
Mickey: Hmm.
Allison: sitting there saying, Oh, well, what were the chances of that? Or, oh gosh, place, right time. It’s just you’re focused on facts rather than sitting here and advantage of the cognitive bias, if that makes any
Mickey: Interesting. Okay. I like that. Yeah. I can see that. I think the other problem with, and I wish we had a lot more just facts like that here in the U. S. I think the problem is facts tend to introduce nuance. You can say, well, this is a good thing that happened. This is also the bad side of it. [00:05:00] And no one’s going to listen to your vote for you if you’re playing both sides.
As I wish everyone would, you have to kind of slam all the way to one side or the other and say the facts that matter to you and then your opinion on top of that and ignore the other ones. And, yeah, it’s very, very frustrating how things have gone this way where, yeah, the nuance has disappeared. And, yeah, because we don’t vote for nuanced people, which is very unfortunate.
Yeah.
Allison: Not anymore. yeah, no, I, I, I liked the, the simplification of issues that typically get very complex.
Mickey: Mm hmm.
Allison: it’s very dangerous, you know, when we oversimplify things. But it’s tough not to oversimplify things, because your brain is constantly looking for patterns, and trying to make sense of things, and so good or bad, You either are calculating things due to, to luck, or to skill, or you’re calculating things based on, ugh, you know, gosh, it’s always gotta be me, you know, shucks golly
Mickey: Yeah,
Allison: so.
Mickey: I try to pay attention to that too, like in the grocery store. I do pick the wrong line from time to time, but I [00:06:00] try to pay attention to know when I pick the right one, like, because it’s going to happen half the time, you know, you just only notice the bad ones. I try to make a note of like, hey, I got the right one today.
This is pretty cool, you know.
Allison: yeah,
Mickey: Um, but you mentioned, yeah, so going back, she talked about hindsight bias a bit. I mentioned in the beginning, that one that’s fascinating to me, Annie Duke. Have you read much of her stuff?
Allison: no,
Mickey: So Annie Duke is where she talks a lot about Um, decisions versus outcomes and how you shouldn’t tie them too closely together necessarily.
She’s a former poker player and so she gives the example of if you start a hand with two aces and you end up losing that hand of poker, the lesson shouldn’t be if I have two aces I should fold. It’s just, it didn’t work out. You had, you made the right decision to stay in the hand and it didn’t work out.
You can see the opposite of like if I got super drunk tonight and went and drove home drunk. And made it home safely. Well, cool. That was a good decision then, because the outcome was like, no, no, it was still a bad decision with a good outcome and separating those can be so difficult to do, but it’s, it’s huge to be able to really understand, like I did the right thing on that project.
It was all right. It just happened to go bad. I’ll still do the right thing next time versus, Oh, [00:07:00] I tried to do the right thing and it went poorly. So that must’ve been a bad decision. Like that was still maybe a good decision. She leads
Allison: wonder, If an, if, uh, Annie, you said Amy
Mickey: any Duke, any Duke. Yeah.
Allison: I
Mickey: No,
Allison: Uh, the biggest bluff,
Mickey: okay,
Allison: that’s how, how I learned to pay attention, uh, master myself and win, and she was a psychologist turned poker player. And she does talk a lot about probability and randomness in the book, so I’m, I’m trying to reflect to see if I can recall any of her kind of references, but I’d be interested to see if she tapped into some of Duke’s concepts there, because
Mickey: we’ll have to,
Allison: would make a
Mickey: we’ll have to check that out, very, very likely. Yeah, Duke led one of her books with, um, the Seahawks in the Super Bowl, whatever it was, 8 or 10 years ago, where they got intercepted right at the end of the game, what a horrible decision that was, but she breaks down how it was actually a great decision.
That pass is almost never intercepted, it gives you a chance to run on second down, like all the reasons it was a great decision, but everyone says it was so stupid because it went poorly. And going back, like, no, it [00:08:00] was a good decision, this had a. It’s a very public, very horrible outcome, but it doesn’t mean it was a bad decision.
It’s, you know,
Allison: Yeah. No, that makes a lot of sense. Well, you know, we use, we use those framework, we use those heuristics to make those decisions. So if, if we, if the outcome does look pretty crummy, it automatically does make, I’ve noticed that a lot
Mickey: Mm hmm.
Allison: football,
Mickey: yeah. Well, all sports. Yeah.
Allison: know,
Mickey: Yeah.
Allison: everybody’s a Monday morning quarterback or
Mickey: yeah.
Allison: morning.
It
Mickey: I’m a Lions fan. And so the Lions, of course, lost the NFC championship. And a lot of people blame the coach for going for it and forth down a few times when he shouldn’t have. I’m like, but statistically, those were the right decisions. It just worked out poorly this time.
And, you know, in retrospect, certainly sure. Go kick the field goal. But you didn’t know that he made the right choice. In the book, um, the quote I pulled here is, quote, A mistake is not something to be determined after the fact, but in light of the information available until that point. And so, again, it’s easy to call it a mistake because of what happened later, but you don’t want to call it a mistake based on what they have at that point.
And even then, it’s tough, because you sort of mentioned, you can [00:09:00] cherry pick which items they should have looked at more carefully versus the ones they did, but making a decision, there’s thousands of things to choose from. You have to make a decision, and in retrospect, you say, Ah, you should have noticed those too, but, It was out of a thousand different points you wouldn’t have other than in hindsight, you know,
Allison: Yeah. Yeah.
Mickey: the hunt
Allison: of the knowledge of the. consequence happens to prompt the decision in the first place. So, unless you know how it’s going to end,
Mickey: Yep,
Allison: you know, can’t blame you.
Mickey: and then she talks about survivorship bias a good bit too, which is another one. I discovered that a few years ago It’s just a fascinating idea of you know, came from you know, World War two with Nicholas Wald. I think his his Abraham Wald, there we go. Nicholas is the writer of this book And when planes would come back from the war they’d look at where they were shot and say oh here all the places they were Shot we should put more armor on those places And it turns out, no, no, if they were shot there, they survived.
It’s the ones that were shot in the other places that crashed and burned that we should put more armor there because they’ll make it back. But you just look at the ones that survived and kind of make your assumptions on that. And so we see that with business leaders and athletes and stuff. We see the ones that made it [00:10:00] like, clearly we should drop out of school, drop out of college because that’s what Bill Gates did.
And that’s what Elon Musk did. And that’s what Michael Dell did. Clearly you should drop out of college, but no, we just saw the three that dropped out and made it. It’s rich and we didn’t see the other 99 percent that dropped out and are struggling now because of their decision. So, survivorship bias is a tough one, too, where you see the success and then see what led to it and say, Ah, that’s the path, even though, nah, that’s the 1 percent that did it that way.
You might want to make a better decision, but, yeah, all this, so much of this stuff all kind of rolls, rolls under different things. Ooh,
Allison: the, yeah, the, the remembering that no one accepts randomness on his own success,
Mickey: yes. Yep.
Allison: that, I think that was one of, uh, One of the things that sticks with you, you know, and, and you can’t, you look at LinkedIn you look at everyone that rightfully celebrates good things that they’ve
Mickey: Mm hmm.
Allison: And it’s very rare that you see someone post on a failure, but it’s kind of funny because even when they do post about failures. kind of [00:11:00] still patting
Mickey: Right, yes, correct, yeah.
Allison: and so it’s it’s interesting to see people’s attributions to What contributes to their success that I think that the author Quotes baseball pitcher Vernon Lewis lefty Gomez who says I’d rather be lucky than good
Mickey: There you go.
Allison: You know, so it’s, um, you know, I, I don’t know, there’s the, the idea that, you know, we all got here, or you, you have your successes because you’ve worked hard, or whether you’ve been lucky and randomly you were just right place, right time,
Mickey: hmm.
Allison: um, that stuff’s always fascinating to me to, to do.
Who takes advantage of the luck, right? Luck, fortunes, the prepared,
Mickey: Yeah, there you go. Yeah, there’s luck versus chance. And yeah, I think chance is really what we’re talking about here. Because luck, I think, is chance and hard work. It’s still obviously a factor of, you know, yeah, numbers. But yeah, hard work can make you seem luckier a lot of times. Mm
Allison: probability, probability.[00:12:00]
Mickey: hmm.
Allison: always kind of a fascinating thing to me when you, uh, when you figure, oh, there’s a greater chance of me getting XYZ if I do it this way. When it’s just all built on how it happened before,
Mickey: Right.
Allison: really have anything to do with what’s happening
Mickey: But that can be tricky too, because you may calculate there’s a 90 percent chance if I do it this way, it’ll work and it fails. You still might’ve been right. You might’ve made it nine out of 10 times. You just, again, that goes back to the whole luck thing, but I love your social media thought though too, because certainly Facebook’s another place we see that we see all these other families are so much happier because they’re always just at the beach and hiking.
And, you know, Allie and I have struggled with that a bit with our company, because we’ll see these other marketing companies say, wow, we’re trying to figure out what we’re doing. They all have it all together. They have it buttoned up, like they have it great. And then they go out of business or they lose a bunch of people like Like, Oh, maybe they didn’t have so good.
They just kind of show showcase they did. And it’s not an excuse for us to slack off and not try as hard knowing that everyone’s suffering, but it’s not like we’re way behind everyone either. I don’t think, I mean, I wonder, there’s some companies I look at and the more I get to know, I’m like, wow, they really have their stuff together.
Most of the time, the more you dig in and say, okay, [00:13:00] they’re good people, but they struggle just like the rest of us do. They just, they just don’t show the struggles just like we don’t either. I mean, heck, if you look at our social media, we look perfect too. I hope, but I promise we’re not, I guarantee it.
Allison: reel, right?
Mickey: Yep. Yep.
Allison: It’s a highlight reel. It’s not, it’s not life. And I think the quicker people realize that, um, more friendly social media becomes to mental health.
Mickey: Yes.
Allison: you don’t, you don’t go on it to check on everybody’s status. You go on it to see the highlights.
Mickey: Yeah, it’s one of the things I love. I’m in one of the, uh, CEO roundtable groups with the Cobb Chamber. I don’t know if you’ve done that before. Uh, feels like something you would have, yeah. And that’s fantastic because it’s all these other businesses that kind of open up. After a few months they start saying, here’s where I’m struggling, here’s the problems I’m having.
We all, and like, I have the same problems too. Let’s work on it together. And it’s rare to get that kind of group. Because again, social media and public stuff, it’s all just shiny and packaged and ready to go. So, it’s a little different.
Allison: Yeah. For sure.
Mickey: Another, another area I noticed in the book, she, she kind of, uh, he kind of hit on stoicism a good bit too.
Um, just the idea there, the quote here is, um, the only article Lady [00:14:00] Fortuna has no control over is your behavior. Good luck. And so that’s a lot. Um, back in episode seven of the show, Bobby Kirsch and I talked about Ryan Holiday’s The Obstacles of the Way and Ryan Holiday’s huge on stoicism, but it’s basically, yeah, control your behavior.
Luck is going to be good. It’s going to be bad. It’s going to do things to you. How are you going to respond? And that’s the only thing you really can control. So respond the best you can, make the best decisions you can. Sometimes you win, sometimes you lose, but if you keep making the right calls, odds are you’ll win, win more than you lose.
Um, have you read much of like Ryan Holiday or any stoicism stuff?
Allison: No, that reminds me of um, oh god, well you know what, maybe it was uh, Discipline is Destiny.
Mickey: That sounds like one of his. His always have the little, yeah, that kind of name. I believe so, yeah.
Allison: That’s a good
Mickey: Yep.
Allison: cause I, in, in today’s world of immediate gratification,
Mickey: Mm hmm.
Allison: and, and just wanting change or wanting something right now, whether it’s Amazon overnight or a bunch of likes on a social media post, um, it’s just so much easier to do things and get immediate [00:15:00] response. There was a conversation I was having with a best friend who’s a nurse and a school nurse. And I had lunch with her the other day and I asked, what in today’s generation, I mean she’s been a nurse almost 20 years, I said, in today’s generation, today’s kids, how are they any different? kids and without even hesitating, she said, you know, I expected her to make some joke about Gen Z or
Mickey: Right.
Allison: instead she said, today’s kids don’t know how to be uncomfortable.
Mickey: Hmm. Okay.
Allison: And that
Mickey: Interesting.
Allison: into that notion of lack of discipline. To me it feeds into maybe some of the conversation about randomness. You know,
Mickey: Hmm.
Allison: if we don’t know how to be comfortable, we And we don’t, and we’re not disciplined, and it all, it is about the here and now. How much of that is feeding into cognitive bias?
How much of that is just fueling the fire?
Mickey: Gotcha. Interesting. Yeah, I feel like that probably is related [00:16:00] to We don’t have a chance just to sit in silence either We always have something to do, you know There’s and I try to force myself to do that from time to time It’s tough like I struggle with that But it can be huge just to not have any distractions and put your phone in another room and just kind of just just chill For a bit and it’s very uncomfortable, but it’s it can be great That’s that’s why I think we have like shower ideas and stuff because that’s the only place where you’re
Allison: Yes.
Mickey: without some other, you know, stuffing your ears.
Even when I’m mowing the lawn, I’ll often listen to podcasts or whatever, which gives me some ideas, but it’s different than just mowing the lawn and just letting my mind wander. And perhaps I should do more of that. So we’ll see. I think
Allison: Same.
Mickey: lawn mowing is starting pretty soon here for us for the season. So that’s going to be super fun.
So. Um, yeah, also you’ll need to check out any Duke stuff because hers is fantastic. But yeah, any of Taleb’s stuff is great too. I’ve really, really enjoyed this book and this, this concept, um, quite a lot. So I’ll kind of leave it with, he said this last little quote, no matter how sophisticated our choices, how good we are at dominating the odds, randomness will have the last word.
So I think, again, we should make good choices. We should, you know, make [00:17:00] sure our decisions are based on what the decision, not the outcome, all that kind of stuff. But randomness is going to play in, which we need to remember. It kind of, it kind of goes to the idea of like other, other people and other, other drivers on the road and stuff, just thinking of, you know, if they do something dumb, it’s because they’re dumb.
If we do something dumb, we have a good reason for it. Like, randomness kind of factors the same way too, where we might get lucky and succeed where someone else fails and, and knowing, knowing that it was luck that did it is, is important to remember, I think. So, awesome. Well, thank you so much for being here.
Um, if folks want to connect with you, where can they find you online?
Allison: Uh, find me on LinkedIn, uh, reach out, send me a note, tell me you’re listening to us on the podcast, so I don’t think you’re a spammer, uh,
Mickey: There you go.
Allison: forward to
Mickey: Good call. And I’ll put a link to her LinkedIn in the show notes. So Allison, thanks so much for being here. Appreciate it.
Allison: Thanks for the chat.
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