Imagine a judge sentencing someone to prison and afterwards saying: “I just went with my hunch”. Jaws would drop to the floor. And in this case, and line of work, you’re supposed to back up your decisions and conclusions with systematic analysis and conscious thought. In fact, in most professions this is what you’re supposed to do, without even doubting it for a second.
But several business leaders and researchers actually advise us to trust our intuition.
Depending on the context and your experience, trusting your gut can be a very wise thing to do, despite all you have heard about this “intuition-nonsense” and that evaluating all possible options is the best road to success. Gary Klein is one of the scholars who kills this common assumption.
Lost in contemplation?
Let me give an example from when I was new in a job and we were working on developing a new logo and graphic profile. My own lack of experience made me go through a range of different options. I did not want to jump to conclusions, in line with Klein’s commentary on people assessing more options before gaining experience. I wanted to have all the evidence laid out in front of me, which is quite impossible as information tends to come in sequences. Instead of engaging in anticipatory thinking, I was imposing a rather bureaucratic procedure for collecting and sorting data. It appears now as very counter-productive to use such a rigid method in a setting where a fresh and modern outcome was sought for. Klein stresses: “Conscious deliberation presses us to view the world through a keyhole – the limitation of attention”.
What I was unaware of at this point, was that intuition embraces the contextual setting and can be a crucial part of making good decisions. Intuition, is defined by Matzler as “a highly complex and highly developed form of reasoning that is based on years of experience and learning, and on facts, patterns, concepts, procedures and abstractions stored in one’s head”.
In his paper, he speaks of intuition as an x factor, and that the higher up the corporate ladder people climb, the more they need well-honed business instincts. Ralph S. Larsen, CEO of Johnson & Johnson in the 90s, explains the difference between the two modes of thought:
Very often, people will do a brilliant job up through the middle management levels, where it’s very heavily quantitative in terms of the decision making. But then they reach senior management, where the problems get more complex and ambiguous, and we discover that their judgement or intuition is not what it should be. And its a big problem.
Sadler-Smith states that “Executive intuition is the skill of focusing on those potentially important but sometimes faint signals that fuel imagination, creativity, and innovation and feed corporate success in globally competitive business environments”. In fact, when you’re in need of creative and innovative approaches, you are most likely within a complex setting and you should pay more attention to your gut feeling that picks up on the signals around you. (continues below photo…)
Towards better decision makers?
However, one problem with intuition, or tacit knowledge, is that it is resistant to scrutiny and evaluation. As Klein writes, we all build our own mental models, which are are stories constructed to understand how things work. These shortcuts are used to make quick judgments and shape both how we perceive and act. Such tacit knowledge moves at a lightning speed, making us jump to generalizations so fast that we do not test them.
So when should we trust what? Sadler-Smith point to the interplay between knowing and sensing, and the possibility of using both to cross-check. He advices using systematic analysis to “backup” your gut feeling. Indeed, it is possible to make mistakes here as well, and the world renown psychologist and nobel prize winner David Kahneman has written a piece with questions to ask for detecting decision biases we all face. It is easier to do this in teams or group work, as he states “We may not be able to control our own intuition, but we can apply rational thought to detect others’ faulty intuition and improve their judgment”.
In any case, our complex business environment can benefit from more intuitive thinking: CEO of Wisconsin Energy Corporation back in 2001, Richard Abdoo meant:
As we move to a deregulated marketplace, we don’t have this slow process of hearings and review and two years to make a decision. We now have to make decisions in a timely manner. And that means that we process the best information that’s available and infer from it and use our intuition to make a decision
Even Henry Mintzberg, the acclaimed scholar on business and management, advise us to put less effort on traditional thinking, and more on sensing. He clearly points out these limits of “thinking first” and of rational decision making.
Trusting our gut can help us to “decide on deciding” more quickly and efficiently, in a fast-paced business environment. I believe it is meant to be a bit messy. As Mintzberg and Westley wonder: “Maybe messy, real-life decision making makes more sense than we think, precisely because so much of it is beyond conscious thought.
References:
Hayashi, A. (2001). When to trust your gut? Harvard Business Review, 79(2), 59-66.
Kahneman, D., Lovallo, D., and Sibony, O. (2011) Before you make that decision, Harvard Business Review, 89 (26), p. 50-60.
Klein, G. (2009) Streetlights and Shadows: Searching for the Keys to Adaptive Decision Making. Cambridge, Massachusetts: MIT Press.
Matzler, K., Bailom, F., and Mooradian, T.A. (2007) Intuitive Decision Making. MIT Sloan Management Review, 49 (1), p. 13-16.
Mintzberg, H., and Westley, F. (2001). Decision making: It’s not what you think. MIT Sloan Management Review, 42 (3), p. 89-93.
Sadler-Smith, E., and Shefy, E. (2004) “The intuitive executive: Understanding and applying ‘gut feel’ in decision-making”. The Academy of Management Executive, 18 (4), p. 76 – 91.
Senge, P. (1992). Mental Models (1992) Planning Review, 20 (2), p. 4-44. Retrieved from: http://www.emeraldinsight.com/doi/pdfplus/10.1108/eb054349
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