HEADS OR TAILS? HOW LUCKY ARE YOU IN BUSINESS?

In a television episode, The Secret of Luck, from a series called The Experiments, illusionist Derren Brown tested the idea of luck.  Tracking the different experiences that people defined as ‘lucky’, Brown concluded that the more people were open to opportunities, the luckier they became.

Luck is an incredibly important aspect of business success.  When a business succeeds, a mixture of skill and luck will inevitably be involved. Yet few business owners are willing to recognise the role of luck and their story of their success will contain large portions of revisionist history. Social psychologist at the University of California, Paul Piff, carried out an experiment in which more than 100 pairs of players were invited to play a rigged game of Monopoly.  In each game one of the players was given twice the amount of starting money, each time they passed ‘Go’ they collected twice the amount of money, and they were allowed to roll two instead of just one dice.

The experiment confirmed the obvious: that the advantaged player would win every game, but as the games progressed, the ‘rich’ players became ruder, flashed their money and boasted their wins, ate more of the pretzels that were placed on the table, and became less sensitive to the position of the other person.  Even more revealing were the players’ responses after the game. When the researchers asked the players about their experiences during the game, the ‘rich’ players talked about the properties purchasing decisions they made as the reason for their success.  The situational features particularly, that based on no more than a flip of a coin they started from a privileged position, were glossed over.  A “a really, really incredible insight into how the mind makes sense of advantage”, says Piff in his TED presentation on the topic.

Our thinking that success comes down to skill is not just because we are fed a steady diet of stories from those who ‘made it’, like the ‘rich’ Monopoly players, are more likely to credit their own actions than their good fortune; nor is it necessarily because our egos are waiting for their chance to shine.  Social psychologists explain that we have a tendency to overestimate the degree of control we exercise over our destiny.  Our role in our own ‘story’ appears greater than it is because we are involved.

All achievements are part luck.  A chance meeting with someone who had a hand in our success, a fortuitous comment or discussion that led to an idea, a lucky break that gave us just enough traction to make it to the next level, something we dabbled in for no sensible reason for many years suddenly is in demand – their occurrences are likely small and many.

The luck that led to Skylanders

The enormously successful Skylanders toy launched in 2011 and within two years had generated over $2 billion in sales.  Skylanders was the creation of digital gaming company, Toys for Bob (not a toy company) which had released moderately successful games in the 90s but by the 2000s was paying its bills churning out licensed children’s games for game publisher, Activision.  By around 2008 gaming sales were falling, only partly due to the economy.  Children had become too familiar with the standard formula that underpinned video games and their appeal had dropped to a fraction of their early days.  Activision suggested that Toys for Bob should work on creating something new for the market.  The result was Skylanders, the playable monster characters that could also be integrated into a video game via a plastic tray that connected to a console.

When the toys were presented to Activision CEO, Bobby Kotick, he thought it was too early to launch.  He wanted both a more polished product and better market timing, so despite the protests of his team, he made the risky call to hold the release back for twelve months.  Toys for Bob founders, Fred Ford and Paul Reiche, acknowledge their twenty years of solid game development experience, the skills of their creative team, and the willingness of Activision to back them as reasons for the toys’ success.

However, they credit the collective skills and experience for only part of their success.  They have no doubt that luck played its part, starting with co-founder Paul Reiche’s early ambitions to be a geologist put to bed when it turned out he was highly allergic to poison oak.  With his planned career thwarted, he started making games.  He met Fred Ford through their shared love of fantasy and gaming.  The business they later formed was fortunate, in retrospect, that it chugged along well enough to survive but never achieved much more than a couple of minor hits.  By the time Activision gave them the green light to work on a new development, they had many years of experience but nothing successful enough they needed to focus on.

The Toys for Bob team discussed and discarded many ideas until one remained: something that tied monsters, strategy and kids together – the shared interests of the company’s key people.  The company had no experience in toys but their lead designer I-Wei Huang had a side hobby, drawing toys and robots and turning them into figurines.  The team turned to him to create the toys.  When it came to working out how to connect the toys to games, as luck would have it, Huang shared an office with a programmer, Robert Leyland, who also had a side hobby – fiddling with electronics.  Everything the team needed to create the gaming connection just happened to be sitting in Leyland’s basement.  The delay that Kotick imposed on the game launch gave them another piece of luck.  The cost of the RFID technology used to store the players’ game had suddenly come down significantly, having a positive impact on both the play quality and the price.  Ford and Reiche recall one disappointment in the early days of development.  Activision proposed to partner with Nintendo which was flush with wii money.  Despite the clear strategic fit, Nintendo executives sat on the opportunity for a long time before declining it without explanation.  With hindsight, Ford and Reiche now see this as a lucky escape.

Luck matters, not just method

Our ability to start a business, even one that fails, means we are already beneficiaries of luck.  If we were lucky enough to be born in a wealthy country, education is a right and resources are relatively accessible, instead we could be living in a country where simply surviving is a full time occupation.  If we recognise the many advantages already gifted to us, there is no reason not to think that we should not be developing our skills AND taking advantage of as many lucky breaks that may come our way.

Good luck with your every endeavour.