Michael Mauboussin is the head of Global Financial Strategies at the investment bank Credit Suisse and a published author of four best-selling books, but he may not have even gotten his career started if not for a trash can. Seriously. I recently spoke with Michael about his book "The Success Equation" which talks about how luck plays into success. Here are the four lessons I learned - I hope they help you achieve your own success.
1. Luck is a combination of preparation and opportunity
When Michael was a college student, he went up to New York to interview with the preeminent investment bank at the time, Drexel Burnham Lambert. He was scheduled to interview with six junior staff members and one interview with a senior executive. When he started his interview with the senior executive, he noticed a Washington Redskins trash can and made an offhand comment about it. The interview became a conversation about their common love of sports. He got the job. It was only months later he found out that the six junior staff members voted against hiring him, but the senior executive overruled them all. And Michael's career in finance was born.
How much of this was luck and how much of this was Michael's skill? Michael was an athlete at Georgetown University in Washington D.C. who interviewed with a senior executive who was a Washington Redskins fan. And he had the grades to secure an interview with the investment bank. So you can't really say this was all luck. But if a conversation about a trash can never happened, Michael may not be where he is now.
2. Luck is sometimes created by emotional factors not attributable to logic
Do you know why the Mona Lisa is the most famous painting? According to Michael and his research, it's not because of that iconic smile. Until 1911, the Mona Lisa was not even considered the top painting in the Louvre. In 1849, the Louvre commissioned a market value assessment of their paintings for insurance purposes. Raphael's La Sainte Famile de Francois I, Raphael's La Belle Jardiniere, and Leonardo Da Vinci's La Vierge aux Rochers were all valued significantly higher than the Mona Lisa. But in 1911 something happened. The Mona Lisa was stolen by an Italian nationalist and a media hysteria ensued. Eventually the Mona Lisa was recovered and when it was, the painting was revered as a national treasure and its fame never subsided after that event.
Until 1911, the Mona Lisa was considered just another great painting in the Louvre but it's perception changed when society decided to give it significant value after it's theft. Soon after, Leonardo Da Vinci's painting became the most valued painting in the Louvre despite being the same painting it had been for the past 500+ years.
3. Luck can be engineered strategically by playing to one's strength
A professor of International Relations researched wars and how successful smaller countries were against larger countries throughout history. He found that from 1800 to 1849, the larger country (and thus larger military force) prevailed 88% of time. However, from 1950 to 1999, the larger country only prevailed 50% of time! Michael attributes this to the smaller countries refusing to engage where the stronger country has an advantage (e.g. guerrilla warfare). In the classic story of David vs. Goliath, David refused to engage Goliath in hand-to-hand combat because he knew that was Goliath's strength. Instead, he stayed far away and used a slingshot to take down the giant.
Whether in business, sports, or war, it's important to engage your enemies in an arena where YOUR strength is magnified and not where you're playing to their advantage.
4. Sometimes... there's just dumb luck
Quite possibly my favorite story in his book, Michael wrote about the Spanish national lottery which has been around since 1763. In the mid-1970s, a man won the big prize ("El Gordo") by purchasing a lotto ticket that had the last 2 digits "48". When asked by media why he chose that number, he said, "I dreamed of the number 7 for 7 straight nights. And 7 times 7 is 48."
Conclusion
I find the concept of luck very fascinating. How much of it can be engineered and how much is it just plain dumb luck? Who knows but I hope my interview with Michael helps you engineer your own luck in your life.