The Instinct Myth

The Role of Instinct in Leadership.

I was coaching an executive last month and we were discussing a business deal that had gone sideways.  She said, “I found an acquisition that looked fantastic.  It was exactly what we’d been wanting.  While the due diligence looked good, my gut kept telling me something was off.  I ignored my instincts, plowed ahead….and the deal failed miserably.  I should have listened to my gut.”

Instinct and Leadership

After the conversation, I thought about the role of instinct in business.  The best leaders are known for having great instincts.  They are able to see beyond numbers to uncover opportunities, invest in the next generation of leaders and create roadmaps to success.

It’s hard to pick up a business biography without a tale of a leader trusting his/her gut to achieve a great feat.

We seem to revere “the power of instinct.” In “Blink,” Malcolm Gladwell theorizes that intuitive based decision-making can generate better outcomes than lateral methods like those based on data.  Yet, our actions are counter to that belief as we are rewarded for decisions based on data.

Has leadership instinct become today’s urban business legend?

Cover Your ‘ahem’ Tushie Strategy

As we come up through the management ranks, we are expected to explain, justify and rationalize choices we make.  Business cases on “gut feel” rarely are compelling.  We are trained and rewarded for data based decisions.  So, guess what we do?!?

Couple that behavioral conditioning with the uncertainty from the recession and we have the perfect storm of CYA (Cover Your “Tushy”).  In the era of cost cutting, layoffs and restructuring, I’ve seen managers’ risk tolerance drop.  With high unemployment rates, do you want to be “the guy” presenting a pie-in-the-sky idea that came to you in the shower with no supporting data to the CEO or Board for approval?  Um, no.

Gut Check

I’ve spent quite a lot of time planning with my client’s leadership teams.  We’ve discussed their business outlook, debated possible growth strategies for the next 12 to 18 months and then reviewed the impact past choices had on their businesses.

In the pre-recession bull market, these leaders made bold choices – some based on data, others on pure gut instinct.  During the recession, they became conservative and much more reliant on facts and figures to justify choices.

Here’s the good news – The risk averse mentality has faded over the last year.  These executives are opening up to new opportunities that were considered unfathomable even a year ago.

Moreover, I’ve also noticed a common theme in these highly effective leadership teams.  They are taking a balanced approach to their choices. They rely on all of their faculties: intellect, experience and instinct.  This approach has been successful – enabling them to capture the uplift of the market recovery.

The Answer Is…..

Is it purely data or instinct?  It’s actually both.  The key is to avoid pure reliance on one thing.

Success comes from a balanced approach.  It’s looking at the whole picture – data, gut, experience – and then making a choice that creates success.

If my client had trusted her gut and not purely the numbers, she would have put the brakes on the deal and avoided a failure.  While it was a tough experience, she got the lesson and is a stronger leader for it.

Bottom line:  Use all of your resources.  And, listen to your gut.

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 As a leader, what is your most effective approach for decision-making?

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