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A common misconception we have in society is that successful people are extraordinarily talented. It turns out that much of their success is derived from another, more elusive source. Especially early on in their story. Once you understand the psychology behind this, you can discover easy ways to increase your luck and good fortune in life.
Very few people who have made it big in life will ever admit this attribute that would have definitely played a part in their success. Sometimes, a considerable part. What is it? Well, plain old fashioned luck and having the right things line up for them at the right time is the honest answer.
Table of Contents
- The Role Of Luck In Extreme Success
- The Psychology Behind Increasing Your Luck
- Regression To The Mean
- Statistics Behind Boosting Your Luck
- How To Increase Your Luck
- 1. Learn Risk Management And Keep Yourself In The Game
- 2. Spread Out Your Odds To Increase Your Luck
- 3. Build A Talent Stack To Increase Your Chances Of Luck And Success
- 4. Ignore The Success Stories Of The Rich And Famous
- Finding Fulfilment (And Increasing Luck) In Life
The Role Of Luck In Extreme Success
Chance and luck are something we have very little control over. However, when we understand that there is both a psychological and a statistical aspect to it, we can align ourselves to take the best advantage for when a hot streak finally comes our way. And eventually, it will.
Daniel Kahneman, the renowned psychologist and winner of the 2012 Nobel Prize in Economics, shows how there are surprising consequences when luck is factored in to someone’s success.
According to Kahneman, here’s what really predicts success:
Success = Talent + Luck
Great Success = A Little More Talent + A Lot Of Luck
The Psychology Behind Increasing Your Luck
At first, this seems a bit ludicrous. We’ve all been told that extremely successful people get there because of their extensive skills. Ones that almost no one else has. Bestselling books are written about this. What they miss are many other people with exactly the same skill set. Why have these people not had anywhere close to the same success?
There is a cognitive sciences name for this effect — survivorship bias. We never see or hear from those that don’t make it.
This means that there is something else needed to explain supreme success. Invariably, this is some form of luck these individuals found early in the process. And it was this that put them slightly ahead. After their first lucky break, it became easier for them to move upwards.
Regression To The Mean
There is a statistical basis to this called the regression to the mean – when you see above average performance over a period (success), the more likely future outcome is that this performance will get worse (regress to the mean). The reason for the superior performance in the first instance, is essentially luck.
Daniel Kahneman discusses this in Chapter 17 of his book, Thinking, Fast and Slow, where he discusses the concept of regression to the mean or reversion to mediocrity.
Regression to the mean and the narrative fallacy. Plus, other cognitive biases that make us miss out on luck.
By Daniel Kahneman, published by Farrar, Straus, and Giroux, New York, NY 2011.
Statistics Behind Boosting Your Luck
This concept is so difficult to grasp that is was only discovered by Sir Francis Galton a couple of centuries after Newton’s theory on gravity! It stayed so elusive because psychologically, humans always look for causation when outcomes above or below the mean are seen.
So while this effect was always in play, even scholars were blind to it because of our psychological nature to invent a story to explain what we observe. We don’t assign random luck to someone’s performance. Instead, we create narratives (a jinx, overconfidence) to explain what is essentially a process moving to it’s average outcome.
The more extreme the original success, the greater the likelihood that the next outcome will be closer to the mean (average performance). An initial bad performance would indicate a better outcome on the next try.
How To Increase Your Luck
Here are some easy ways to increase you luck and place yourself in the way of good fortune. You should also be prepared to take the best advantage of the situation when luck finally comes your way.
1. Learn Risk Management And Keep Yourself In The Game
Learn how to manage your risks. Pay attention to what you could lose. And less attention on what you will gain. If a possible outcome in your risk strategy involves complete ruin for you, just don’t take that risk. Only risk when your losses can be covered by you.
This is the most important lesson for to increase you chance of finding luck and fortune. To find more luck, you can’t get cut out of the game in the first place.
Stay in the play at all costs. You may miss several golden opportunities. But if a bad outcome in any of those endeavors results in a complete loss, you are actually lucky that you stayed away form them. Nassim Taleb has the best book out there for understanding risk. Read it at least 3 times to absorb all the great wisdom from this bestselling book.
In our current times, the cryptocurrency market is a great example of what we should avoid. Anyone who has a majority of their holdings in crypto should only do so if they are OK with losing all of it.
2. Spread Out Your Odds To Increase Your Luck
Now that you’ve understood where true success comes from, you can remove the pressure you’ve been putting on yourself. You will find a purpose to your life more easily when you set yourself free from unnecessary expectations. Many of our setbacks are not due to something lacking in us. It’s just that the timing was not right.
Don’t give up on your own efforts. The more seeds you spread, the more likely that luck and the regression to the mean will catch up for you. And give you your big break. Use these new insights to remind yourself to always be willing to start again. Keep trying as many things as you can. Good luck is just around the corner.
The best example where you see this behavior is among successful venture capitalists and Wall Street traders. The good ones don’t try to overthink investment opportunities. What they look for are many baskets to put their eggs in.
3. Build A Talent Stack To Increase Your Chances Of Luck And Success
One way to enhance your ability to take advantage of your inevitable luck, is to develop a formidable talent stack. This is a special combination of skills that complement each other. A skillset that when put together acts as a force-multiplier to what you can deliver overall.
There are simple ways to develop a potent skill stack. Which combination works for you will depend on your profession and calling in life. There is a full guide on choosing and developing talent stacks that work for you. You can find that useful guide here.
Your unique talent stack will be your first weapon to wield when chance provides you with a break. Luck is useless if you don’t have the basic skills to take it further to a desired outcome. We are not saying that successful people only have luck on their side. They also know how to take advantage of it. And so should you.
4. Ignore The Success Stories Of The Rich And Famous
Don’t be overly awed by one individual’s or a company’s meteoric rise to success. The story told about it may sound inspiring. In reality there are no lessons in it for us. The narrative is being told to us in hindsight. Omitting all the luck the participants would surely have had for many key parts.
For example, what are the real odds that the founders of Google would be able to recreate their success on another venture? Assume they have the same level of funding and obscurity that they had during Google’s early days.
The Narrative Fallacy Blinds Us From Noticing Luck
Almost all of the success we see around us came to these individuals with a dose of luck. Sometimes, a hefty portion of chance. None of these people, including ourselves, are able to grasp the relevance of this.
This is due to our psychological blindness to this. Actually, a cognitive bias called the narrative fallacy. Which is our tendency to ascribe an elaborate story to events in retrospection. Falsely associating success with extreme skills. While ignoring what may have been the biggest contributor — luck.
Finding Fulfilment (And Increasing Luck) In Life
Good luck! Mathematically, it is bound to come your way as long as you stay in the game long enough. Follow the steps above to boost your luck and prepare yourself for taking advantage of it when it finally comes your way.
Shaun Mendonsa, PhD is an influencing expert and pharmaceutical development leader. He writes on the topics of influence and persuasion, and develops next generation drugs in human pharma by advising international pharmaceutical CROs and CMOs. He can be reached at [email protected].
Survivorship Bias; Cognitive Sciences; Career Advice; Risk Management; Talent Stacks; Regression To The Mean; Daniel Kahneman; Narrative Fallacy; Statistics.
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