As folks continue to monitor the presidential elections, I think it’s worth revisiting an important truth about probability and strategy.
If someone is given a 90 percent chance of winning something, that means if you replay the same scenario 100 times, that person wins on average 90 times.
Ninety is not 100. When you only get to play that scenario once, and the person favored to win 90 percent of the time loses, that doesn’t necessarily mean that the probabilities were wrong, and it doesn’t necessarily mean that the strategies that resulted in a loss were wrong either. They all could have been wrong, but it requires much deeper analysis to evaluate that.
If there’s a silver lining to the last two presidential elections, it’s that we’re collectively learning this in a very visceral way. The better we understand this, the better we’re able to make strategic decisions and prepare ourselves for different outcomes. It’s not just true in presidential elections, it’s true in business, and it’s true in life.
Professional poker players understand this. (I highly recommend Maria Konnikova’s The Biggest Bluff for more on what we could learn from professional poker players on strategy and decision-making.) Bill Belichik understands this. Nate Silver and the good folks at Five Thirty Eight are constantly trying to explain this to the rest of us. It’s very human not to understand this, but it’s helpful to keep trying.