Playing the Long Game!
The Long Game!
Whether we are investing in the stock market, pursuing our educational journey or traversing our professional lives, we constantly hear the term: PLAY THE LONG GAME? However, seldom is it decoded as to WHAT it is, HOW we should play it, and WHY we should play it. Let’s try and explore this a bit further and see if we can build some perspective on this.
WHAT IS the Long Game?
Our resources, attention, and mindspace is limited. Everything we do, requires us to make choices. When we decide to do something we have decided to forgo the millions of other things we could have done in lieu of that. Be it in terms of the money or time we spent. For instance, at the time of writing this article, I had many competing choices. I could have used the same time to watch Netflix, to workout, to spend time with my son, to call a friend and so and on. Now, each of these competing options in turn has a satisfaction/ gratification payoff that we experience once we have completed the activity. Some of these options provide an immediate gratification (such as watching Netflix) while others provide a great yet delayed gratification, In the adobe example, pursuing to write an article is an effort intensive choice I made in favour of the other options, with a view to achieving delayed but greater gratification in the future.
Long game is really about delaying the gratification of what we seek, such that we can avoid taking short term or instant gratification decisions in favor of those that enable us to achieve grander by delayed long term goals. This can mean avoiding the temptation and distractions to sell our shares when the price of stocks has increased by 2% within a month, in favour of continuing to stay invested for a longer time horizon (assuming it’s an investment worthy stock). Equally, it could mean avoiding switching a job for a short term hike, in favour of carving out a more long term career in a stable employee friendly company.
But here is the interesting part. There is no standard definition of what the long game is, and it varies for each of us. For instance, taking the above examples forward, for a stock day trader, the long game may be holding onto the stock till closer to the market closing hours (vs. just selling it within the first few hours of trade having made some initial profit), while for a long term investor it may mean holding the stock for many a year. Likewise, for a person looking for a job change, knowing the end game and context matters. If she is looking to build a long term career in the same industry, choosing his jobs based on stability and opportunity makes sense. However, if the objective of the individual is to experience many different job types or make a quick buck so she can start her business in an unrelated field, switching a job in the short term (within a few months/ year) may be ideal.
The lesson, define what’s your endgame, for your end game defines your long game. Once you know your long game, you can make choices to further it. There is no universal long game, for in the long term we are all dead!
WHY Play the Long Game?
Let’s start by studying what science and psychology has to teach us.
Marshmallow experiment:
Walter Mischel, a psychology Professor from Stanford, in the 1960-70s ran a series of experiments on children that were meant to predict their future success in work, life and health. Children, typically in the 4-5 year age group, were seated alone in a room. They were then given a piece of marshmallow and told that the teacher would be back in 15 minutes. They were told that if they did not eat the marshmallow during this time they would be given another marshmallow. However, if they did eat the marshmallow they would not be given the second marshmallow. After this the teacher left, and though the children’s antics were being recorded from a hidden camera.
Some children ate the marshmallow as soon as the teacher left, while others did interesting, and often entertaining, things to distract from eating the marshmallow. Some would stare into the mirror, others would talk to themselves, some would cover themselves to prevent themselves from eating it. This wasn’t the most interesting part yet. Many years later, as these children grew up to be teenagers, researchers continued to track their growth and success in different facets of life. The finding that emerged provides great insight to the power of delayed gratification. Those children who delayed eating the marshmallow fared substantially better in a range of things from their SAT scores, lower levels of drug abuse, lower probability of obesity and better social skills (as shared by parents). The researchers continued to track the children till they were 40 years old to test if the validation of the marshmallow in the latter years of life. Their findings helped establish that those who had showcased the ability to delay the gratification, succeeded better on a number of different life measures.
This experiment has since been replicated a number of times over the years in different settings and contexts, with similar results coming through. The reason the long game matters is that it prevents us from making suboptimal choices, and focuses us on taking actions that are in our best interest, thereby increasing our probability of success. Additionally, since our time horizon is longer than immediate gratification, it takes the anxiety away from our choices and brings more rationality and discipline to our decisions.
HOW to Play the Long Game?
So can we choose when to play the long game? Is it really in our control or is that a predisposition that some of us are born with as the initial marshmallow test seemed to allude?
Though the Marshmallow experiment has been frequently quoted, it has its limitations too. Over the years, a series of other experiments have found that it’s not just Nature (as was originally thought) that plays a role in determining the probability of delayed gratification. Subsequent studies by psychologists have shown that Nurture too has a role in our ability to delay gratification, and therefore play the long game. For instance, psychologists found that for children who were promised the second marshmallow (or another equivalent delayed reward) but these promises weren’t followed through on were more likely to prefer instant gratification vs. those who saw their promise of the second marshmallow being fulfilled.
This latest finding is revealing in that it tells us we can train ourselves to play the long game even if it may not be our natural disposition. This can be done by keeping small bite sized goals to work towards that have built into them some form of small but delayed gratification, and then treating yourself once you have accomplished what you had set-out to do. This repeated consistently, many times over, helps build the muscle to delay gratification in favour of a more welcome outcome.
As an example: If you want to learn a new programming language, but you often find yourself distracted in watching Netflix, here is what you could experiment with. Break down learning the new language into bite sized chunks of 15-30 mns at a stretch. Each time you have completed this bite sized activity of 15-30 mns, give yourself a small reward - could be 10 mns of Netflix time or a piece of chocolate or anything else. Ensure that you consistently do this for 4 weeks, without a miss. Showing up regularly is important. If you are able to do this consistently for 4 weeks reward yourself with something bigger (say a small purchase or a treat) to reinforce the process. If you have reached till this step, you would have moved a few steps forward in training yourself to play the long game.
Choose Your Long Game Wisely
Rise of the Indian middle class in the first two decades of 2000s can in many ways be traced back to this ability to delay gratification and play the long game. Right from school days, children are unconsciously taught to play the delayed gratification game. Children are often told how they would get the cycle or new pair of clothes once/ if they score well in their schools. This leads them to prioritise studies over other modes of fun and entertainment. This is reinforced year after year, and ingrains a psyche of playing the longer game. As children grow up and get jobs, the same long game yields itself to focusing on buying a house. This means focusing on EMIs vs. splurging on consumables. The Indian middle class has played the long game for sure for several decades now, leading to an upward financial mobility, building of greater asset base, relocation to foreign countries among other things. Yet, this one size fits all definition/ aspiration of what the long game is for the middle class, has had its share of unintended consequences. For one, a lot of people are completely disoriented with their career choices but find themselves in a midlife crisis unable to continue and switch at the same time. Two, there is a high burnout and stress rate with self imposed work obsession and long working hours. Finally, a singular definition of success has often meant peer pressure has had the better of many aspiring and creative talents, relegating them to the rut of 5 day workweek.
This makes me believe that playing the long game is critical, but even more critical is curating what that long game means to you individually rather than going with conventional wisdom.
Footnotes
https://www.simplypsychology.org/marshmallow-test.html
https://en.wikipedia.org/wiki/Stanford_marshmallow_experiment
