Published: Tuesday, January 06, 2015 @ 10:02 AM
Updated: Tuesday, January 06, 2015 @ 10:02 AM
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Not everyone has a taste for poker, and people choose to not play it for a variety of reasons. Perhaps they don’t have the math skills or they just don’t understand the game. It could be they have little tolerance for risk and don’t enjoy formulating and following game strategy. Some people don’t handle losing well, so it’s best to avoid games with high stakes.
That’s fine. You don’t need to like poker. You can go your whole life without needing to play it — no one will force you to.
That doesn’t mean you can’t use the basic poker skills to your advantage. There are a lot of lessons you can learn from poker that will help you thrive personally and professionally. Rather than have you put money on the line to learn them, we decided it made more sense to ask experienced poker players to share the most valuable things they’ve learned from the game and apply them to something most people experience but many don’t enjoy doing: salary negotiation.
1. Read the Situation
When going into your boss’ office to ask for a pay raise, there are a lot of factors in play that will impact the outcome of your discussion. There are the facts — you know what skills you bring to the table, and the employer knows how much he or she can afford to pay you — and there’s not much you can do to alter those.
Here’s where the dynamics of your meeting come in. You have no control over the cards your boss is holding, but you can persuade him or her to play in your favor by delivering a convincing pitch without appearing vulnerable. Just as in poker, body language has a huge impact on someone’s perception of you and can affect the way they respond.
David Daneshgar, a former professional poker player who won an event at the 2008 World Series of Poker, said everything from posture to breathing patterns can have a huge impact in how seriously you’re taken by the person across the table.
“Act genuine and normal,” Daneshgar said. “I wouldn’t come off too cocky — people in poker with a bad hand would overcompensate with action.”
2. Get Comfortable With an Uncomfortable Situation
The stakes can be high when asking for a raise. For some people, it may mean the difference between paying off debt or having to make tough personal budget cuts. No matter how badly you want to win, you have to understand that you may not and be willing to accept that. Negotiating for a raise may be extremely stressful, but you can’t let your emotions derail your game plan. If you’ve given your strategy a lot of thought and believe you’ve come up with the best course of action you can think of, stick to it, even when things aren’t going well. Desperation won’t win you anything.
“One of the things in poker is, ‘don’t reveal your hand till it’s time’,” said John Rogers, an amateur poker player who has used his 12 years of experience to guide him through the tough stages of entrepreneurship. One of the most common things Rogers sees among new players is a tendency to hold their cards too high or have to look back at their hand frequently, allowing other players to pounce on that vulnerability.
3. Learn to Make Quick Decisions
In poker, quick decision-making indicates you know what you’re doing, Daneshgar said. Don’t mistake immediate action for impulsiveness, because making good decisions requires a lot of thought — just make sure you’re done thinking before you head into negotiations.
It requires a lot of prep work. Daneshgar said poker players run through the scenarios in their minds, knowing exactly what they’ll do in any given situation. A slow response indicates unpreparedness. If you’re asking to receive a larger paycheck, your boss should rightly expect you to have given your request a lot of thought and be able to stand behind everything you’re asking for.
“If they’re thinking on the spot, they haven’t thought it through,” Daneshgar said. To get what you want out of a negotiation, you need to know what you want before the back-and-forth even starts. Even if the situation doesn’t end up the way you would have liked it to, you can reflect on it knowing you did everything you could to have it play in your favor, and you can’t always win.
4. Assess the Risks Associated With Each Scenario
If you play poker, you will lose a lot. When you ask for changes to your compensation, you may not get everything you want. When deciding how to proceed through salary negotiations, decide what’s worth fighting for,based on how much you have to lose if you don’t get it.
This is a process we do daily. If you’re driving to a meeting and the traffic light turns yellow, you’re quickly assessing the risk of the situation: “I’ll definitely get in trouble if I’m late for this meeting, but there’s a good chance I won’t get a ticket if the light turns red as I pass through the intersection,” you think, as you press down on the gas pedal.
If you submit a long list of demands to your supervisor, there’s a very good chance he or she will deny some of them. On the flip side, you’re likely to get what you ask for if you’re requesting something very small — but is that really what you want? You have to know when — and if — you’re willing to walk away. Daneshgar gave an example: If he asks for nothing, his employer will certainly keep him around. If he asks for a $20,000 raise (a massive raise, in this scenario), he risks offending his employer, damaging his relationship with his boss or getting fired. Given those options, he’ll ask for something in between, knowing it’s not worth it to him to risk his job or settle for no raise.
5. Leave Emotions Out of It
Even with all the preparation you’ve put into asking for a raise, no matter how well you think you can read the temperature of your meeting, it’s possible the situation will not go at all the way you want it to. If nothing else, you want to walk away feeling good about the way you handled yourself and confident in your ability to learn from the experience.
“If you change your strategy because of emotional response, that’s a flaw, that’s a crack in the game,” Rogers said. In poker, it’s called tilt — allowing one hand to affect the way you play the next.
“In poker here’s the reality: If you lose a hand for $50,000 and you can’t let that go by and play another game, you’re going to lose a lot of money,” Daneshgar said. Getting emotional when you don’t get what you want in the workplace could translate into a loss of respect or credibility, which severely hampers your ability to succeed. If you don’t get what you asked for the first time, don’t let disappointment filter into your work. If you keep doing a good job and prove your value to the company, you have a much better chance of getting what you want the next time you have an opportunity to ask.
These skills are extremely useful in many career-related situations, not just asking for a raise. Both Rogers and Daneshgar used what they learned in poker to start their own businesses — Rogers is creating a digital poker table called Nucleus, and Daneshgar started online floral business BloomNation.com — and they say their ability to mitigate risk and take emotions out of their decisions have helped them succeed.
Such attitudes are extremely helpful in the world of personal finance, because things often don’t go the way you’d like them to (think home price negotiations). Planning is crucial to any kind of financial success, and as frustrating as failure can be, minimizing the amount of emotion you let dictate your decisions is likely to help you reach your goals.