Decision-Making and Gut Instinct
Every CEO and business owner does it, in the smallest to the largest organizations: they make business strategy decisions on gut instinct. In fact, it can be argued that every business decision is based on gut instinct, even when surrounded by an avalanche of quantitative reports and analyses.
On the other hand, there is value to the sharpest reasoning and coldest objectivity. How to navigate between the two?
The authors point out that emotions exert powerful influence. This does not mean that the business leader should dismiss emotions. They point out that gut instincts influence the way situations are framed, how options are analyzed, and why we pay more attention to some people and less attention to others.
The solution to the gut vs. logic trade-off is to protect decisions from bias, and to do this we need to put our gut feelings to the test. They offer these four tests:
- The familiarity test: Have we frequently experience identical or similar situations?
- The feedback test: Did we get reliable feedback in past situations?
- The measured-emotions test: Are the emotions we have experienced in similar or related situations measured?
- The independence test: Are we likely to be influenced by any inappropriate personal interests or attachments?
Campbell and Whitehead conclude: "We should never ignore our gut. But we should know when to rely on it and when to safeguard against it."
Mission: To help small and mid-size businesses capture the power of big-picture marketing.