Small and medium‑size enterprises often struggle to distinguish between decisions that were sound but yielded poor results and choices that were reckless yet happened to succeed.
This confusion, known in poker as “resulting,” arises because outcomes are visible and immediate, while the quality of the underlying reasoning is harder to assess after the fact.
When leadership rewards or penalizes teams solely on results, employees learn to prioritize short‑term wins over rigorous analysis, favoring low‑variance actions that appear safe on quarterly reports.
Such incentive structures can encourage comfortable mediocrity, as a well‑reasoned but unsuccessful initiative may be condemned while a risky move that pays off is praised.
A simple card game illustrates the principle clearly. In FreeCell Solitaire, more than 99 % of deals are mathematically solvable, meaning a loss almost always reflects a flaw in the player’s decision process rather than bad luck.
Because the entire layout is visible from the start, a failed game serves as a controlled experiment: the obstacle is the sequence of choices, not the deal itself.
Business decisions are far messier, yet the core question remains the same—did the decision fail because of adverse variance or because the reasoning was unsound?
Effective review practices include documenting the rationale before outcomes are known, evaluating the information available at the time, explicitly separating “wrong call” from “bad luck,” and examining losing decisions with the same rigor as winning ones.
These steps do not eliminate luck, but they prevent mistaking chance for competence and ensure that sound judgment is recognized regardless of the result.
Enterprises that consistently assess the reasoning behind choices, independent of outcomes, are more likely to improve over time, while those that equate every result with a verdict on decision quality remain vulnerable to repeated luck‑driven performance.
