We defined a “luck event” as one that meets three tests: First, you didn’t cause it; second, it has a significant potential consequence, good or bad; and third, it has an element of surprise, some aspect of the event is unpredictable before it happens. Using this definition, the evidence showed a lot of luck in the history of these companies. But— and this is the crucial point—we also found comparable amounts of luck in the control set of comparison cases we studied! The big winners did not generally get more good luck, less bad luck, bigger spikes of luck, or better-timed luck than their comparisons. What the best achieved, instead, was a higher return on luck. Hansen and I learned that the question is not whether you’ll get luck along the way—you certainly will get luck, both good luck and bad. The critical question is what you do with the luck that you get. I’ve come to believe that about 50 percent of great leadership is what you do with the unexpected.

In Dalio’s view, believability-based decision making …

Eliminates what I believe to be one of the greatest tragedies of mankind, and that is people arrogantly, naively holding opinions in their minds that are wrong, and acting on them, and not putting them out there to stress test them. Collective decision-making is so much better than individual decision-making if it’s done well. It’s been the secret sauce behind our success. It’s why we’ve made more money for our clients than any other hedge fund in existence and made money 23 out of the last 26 years.

The story’s power, then, is twofold: It provides simulation (knowledge about how to act) and inspiration (motivation to act). Note that both benefits, simulation and inspiration, are geared to generating action. In the last few chapters, we’ve seen that a credible idea makes people believe. An emotional idea makes people care. And in this chapter we’ll see that the right stories make people act.

A second group of students, the “event-simulation” group, were kept in the lab. They were asked to mentally simulate how the problem had unfolded:

We would like you to visualize how this problem arose. Visualize the beginning of the problem, going over in detail the first incident…. Go over the incidents as they occurred step by step. Visualize the actions you took. Remember what you said, what you did. Visualize the environment, who was around, where you were.

Perhaps most surprisingly, mental simulation can also build skills. A review of thirty-five studies featuring 3,214 participants showed that mental practice alone—sitting quietly, without moving, and picturing yourself performing a task successfully from start to finish—improves performance significantly. The results were borne out over a large number of tasks: Mental simulation helped people weld better and throw darts better. Trombonists improved their playing, and competitive figure skaters improved their skating. Not surprisingly, mental practice is more effective when a task involves more mental activity (e.g., trombone playing) as opposed to physical activity (e.g., balancing), but the magnitude of gains from mental practice is large on average: Overall, mental practice alone produced about two thirds of the benefits of actual physical practice.

The takeaway is simple: Mental simulation is not as good as actually doing something, but it’s the next best thing. And, to circle back to the world of sticky ideas, what we’re suggesting is that the right kind of story is, effectively, a simulation. Stories are like flight simulators for the brain. Hearing the nurse’s heart-monitor story isn’t like being there, but it’s the next best thing.