November 20, 2013

Is Success a 'Regression to the Mean?'

Hi Guys,

I have been reading the book ‘Thinking, fast and slow’ written by Daniel Kahneman. It is an interesting book on how our mind works and how we often get things wrong. Yesterday, I was reading an interesting chapter in the book titled ‘Regression to the mean’. In the chapter, he defines the formula for Success.

Success = Talent + Luck
Great Success = A Little More Talent + A Lot of Luck

Success is often attributed with Talent alone. More often than not, we hear people saying that a person was highly successful because he was very talented. People often forget the luck factor associated with it. An equally talented person might not be even half as successful as him.

Malcolm Gladwell in his book ‘Outliers’ would quote people with high IQ and explain how they were not very successful. People generally say that Albert Einstein had high IQ and that was a reason for his success. But, there are lot of other people in this world who have high IQ too, but they end up just being show pieces.

Gladwell would also explain the time factor as to how people who were born in the 1950s had significant advantage than others since when they graduated in 1970s, Computers were in the forefront and they capitalized on that. Not all people would have been benefited out of that, but a few people like Michael Dell and Bill Gates had that luck in them.

Being a cricket fan, I had some thoughts on the game. Most of the great innings would have had some luck factor associated with that. I am a big fan of Sachin and I don’t remember his famous Sandstorm innings at Sharjah against Australia when he hit back to back centuries. When I watched them a few days back, I saw that in the first century, he had an edge that fell between three fielders. In the final, he had an inside edge that missed the stumps by inches. On any other day, he could have got out. Have two chances in back to back matches and getting to be known as the greatest innings has a bit of luck along with his great batting.

If you see players like Mike Hussey or Mathew Hayden or Stuart McGill, they got into the team late. They were not able to get into the team despite the talent. If they were in their 20s today, they would have been selected easily into the team. But, now when the Aussie team wants big talents, they find it hard to get one.

Daniel Kahneman says that the law of averages will catch up with everyone. It is driven by maths and has always happened in the past. We often hear that sportsmen would be nervous after a good performance and would not perform properly. The opposite case would also happen and people would say that they had nothing to lose. But, Kahneman says it is how things happen. This is known as ‘Regression to the mean’. As per Kahneman, good or bad things are not bound to continue for a long period. Everything would tend to move towards the mean.

Just as I was writing this, a point came to my mind. Is Success a ‘Regression to the mean?’ Is luck the main factor that contributes to a person’s success? Sachin might have been a bit lucky here and there, but didn’t he outperform many other batsmen? How come Sebastian Vettel won 8 straight races? Is Usain Bolt lucky to win continuously?

I think that Luck is very much important for the initial success. But then on, you need real talent to go forward. How many batsmen would have got a chance to play for India? A few lucky ones. But how many among them has played more than a few matches? A real talented player would survive, but a player who was just lucky would be thrown away.

Gladwell would have written about the ‘10000 Hours’ concept in Outliers. For anyone to be successful to be in a field, they need to practice for 10000 Hours in order to be perfect. A real talented person who have done this.

There might be few exceptions everywhere. Some would be really lucky and some would be really unlucky. But generally, we can say that a talented person would be successful in life. But for him to reach the heights, he needs certain amount of luck too.

For a person to be one among the top, you need to have the right talent at the right time with a right amount of Luck!

Happy Reading!