Picklist values in formula fields
Key Takeaway
A formula can't compare a picklist field with = or !=. Use ISPICKVAL, CASE, or TEXT for a single-select picklist, and use INCLUDES to check for a value in a multi-select picklist.
A picklist field doesn't work like a plain text field in a formula, so formulas use a small set of special functions to read it. When an app builder knows which function fits each need and which mistakes cause errors, they can turn picklist choices into calculations, labels, and checks.
Why picklist fields need special functions
Picklist values are stored differently than other field types. Because of that, most formula functions and standard comparison operators, such as = or !=, cause errors on a picklist field. For example, the first line below causes an error, and the second line is the fix.
Status__c = "Open" // Error: Picklist fields are only supported in certain functions
ISPICKVAL(Status__c, "Open") // The fixTo reference a single-select picklist, use only ISPICKVAL, CASE, or TEXT.