Getting Lucky

Luck isn’t a constant, it increases with surface area: be in the right places, have lots of conversations, put yourself out there, ask for what you want and be optimistic and positive. See.

Nabeel S. Qureshi, "Principles"

I don't know what to do.

My business, which has sustained me and excited me for over a decade, mostly runs without me now. There are things to fix and improve - but it doesn't interest me the way it used to...and I've never been good at making myself do things I don't find interesting.

So I've been exploring.

I can't remember if we've discussed the explore vs. exploit idea here before, so let's dig into it a bit.

I initially learned about this idea in a book called Algorithms to Live By. It has to do with making decisions - specifically, when to stop looking for alternatives and choose.

Imagine that you're at a restaurant you've never been to before. The menu is huge - hundreds of options. You scan the menu for a bit before finding something that sounds good, but should you keep looking? What if there's something better, something you'd enjoy more, deeper into the menu?

This is a low-stakes problem. Imagine, however, that searching for more options carried a cost. In the real world, that's often the case - spending years looking for just the right partner, just the right house, just the right employee carries real-world costs we have to factor in to our decision. So: how long should we look before we stop?

In reality, we stop whenever we get bored. We hit a wall where continuing the search seems like too much bother, we decide whatever we have is "good enough," and there you have it. But this is far from optimal and often leads us to settle for far less than the best-possible solution.

I have been very guilty of this when it comes to hiring. I typically wait until I really need someone, then start looking for candidates. While I'm looking at CVs and conducting interviews, the pressure is growing; now I have an extra task on my plate (hiring) to contend with whatever problem I was trying to solve by hiring. Add to this the fear of "missing out" (say, by an applicant getting a job somewhere else) and you have a recipe for rushed decision-making.

How do we solve this problem (known in computer science as an optimal-stopping problem)? How long do we search before making a decision?

Part of our difficulty in thinking through this kind of issue is that we're artificially removing the decision from its context. No decision exists in a vacuum - not even the decision of what to order for dinner. To get a handle on optimal-stopping, we need to consider not just the decision that's currently in front of us, but all the decisions you will make about the same options in the future.

In short, how much time do we have to use the knowledge we gain from searching?

Let's return to our restaurant example. The decision of "when to stop looking for something better" makes sense only in the context of how much time we have left to decide. If the waiter is hovering over us and everyone else has already ordered, it's best to just go with our current option. If we just sat down and have plenty of time, perusing the menu makes the most sense.

Same goes for my hiring example. If I had started the hiring process early, before things were melting down behind the scenes, I would feel more free to continue interviewing candidates. If everything's already on fire, it's another story altogether (and this is why we do not wait until things are on fire before hiring. In fact, many of the best-run businesses I know are permanently interviewing people, even when they have no openings available...just so that when they do, they have people lined up.)

The trick here is understanding where you are in the process. Are you in explore or exploit mode?

Exploration gathers more information.

Exploitation uses the information you have to get a known good result.

Whether you are in explore or exploit mode comes down to the amount of time you have left to use the information you're gathering. When you have plenty of time to use your new knowledge, explore. When you're ready (or need to) make that information work for you, exploit by choosing the best option available to you.

As Brian Christian and Tom Griffiths put it:

"A sobering property of trying new things is that the value of exploration, of finding a new favorite, can only go down over time, as the remaining opportunities to savor it dwindle."

In other words, finding the absolute best dish available to you doesn't matter if you waited until the end of the meal to order it.

This year has been all about exploring.

I've started and folded businesses. I've traveled, met people, and had interesting conversations.

I have been "putting myself out there" - often with extremely poor results.

And that's OK!

See, the fact is - I have no idea what I want to spend my time doing for the next ten years, and I have no idea what people are willing to pay me for. The overlap of that particular Venn diagram is completely mysterious to me.

At the same time, my primary business has been doing well enough that I am afforded a significant chunk of time in which to dilly-dally. I don't need to find a new way to pay my bills tomorrow. I am aware that this is a significant privilege and opportunity.

While your situation may not be exactly the same as mine, there are many instances in your life of having more time than you think you have. We often feel rushed to decide, since indeterminacy feels like a risk.

But it's exactly the opposite. Indeterminacy is where luck comes from.

As I wrote in "Guaranteeing Your Success":

Most of what you do in life will produce middling results, and a few things you do will produce massive results.

Guaranteeing our success, then, becomes a matter of making sure we are ready when those opportunities present themselves.

Most people who “fail” (and I use that term loosely - the only person who gets to define “success” or “failure” in your life is you) do so not because they didn’t try, or because they didn’t want to succeed, but because they were too busy working on unimportant things when their big opportunities presented themselves.

Yes, you need to put in the requisite effort to make something pay off.

But you also need to actively explore.

Run tests, get on calls with people with no obvious way to benefit you, put yourself in unfamiliar environments...

And then see what feels good.

That feedback is the universe whispering that there is something here - and to explore a little further.

And then, when it's time to choose?

Pick the best option.

Explore, exploit.

And find yourself getting lucky.

Yours,

Dan

Something I'm Reading:

Setting the Zero Point.

Really illustrated, for me, the way this kind of thing is done, and made the use of this technique apparent in my every day life.

Absolutely a useful and pertinent read.