There are two ways businesses and individuals make important decisions. You can use your rational mind, and use data, algorithms, and logical thought process to arrive at a solution, or rely on your gut instinct, also called intuition.
Most companies use an analytical process to make decisions. Executives and managers spend thousands of dollar (or more) to study customer behavior trends, social media posts,
Making business or personal decisions based on intuition can save you from disaster.
Here’s an example of an intuitive decision. You’re driving to work in heavy traffic when you get a premonition that you should get off at the next exit and take another route to the office. You’ve gotten no indication of a problem from an app, a radio report, or anything you’ve seen; you just have a gut feeling.
You take a circuitous route to work. As soon as you arrive, one of your co-workers tells you about a big car accident on the route you usually take to work. Your gut instinct saved you from a wrecked car or worse. That’s called intuitive decision making.
These feelings rely on your instincts, not facts or analysis. Intuition means you figure out a method or solution with conscious reasoning. When decisions are complex, or facts are conflicting or unavailable, intuitive reasoning may be the best course of action.
Intuition and Decision Making: An Overview
Intuition means you perceive things with step-by-step conscious thought. When you rely on intuition, you’ll get many benefits. These benefits include:
- Making quick, effective decisions in hectic or unusual situations.
- Becoming wiser and more intelligent
- Better alignment of decisions with values and a sense of purpose
- More energy. You save energy by not spending time-solving a problem step-by-step.
- You come up with more creative solutions.
A business decision-maker can use intuition to gain insight and better solutions to many situations, including mergers, joint ventures, investments, and purchasing other businesses.
Relying on rational thought alone may cause you to miss underlying evidence and hidden facts. Intuition helps you uncover less obvious, but more effective, ways of doing things.
For example, a start-up’s investment pitch and its business plan may sound substantial, but something may strike you as odd about the presentation, and you may choose not to invest. Use your intuition to protect you from bad investments that sound attractive on the surface.
If the situation you’re thinking about is uncertain, probabilities, analytics, and other statistical processes won’t give you the right answer. Most personal and many business problems don’t have one safe, logical conclusion. We need to decide what to do based on intuition.
How to Use Intuition in Your Personal Life
We often fret about making the right decision. Despite our best efforts, we often make wrong decisions about where to work, where to live, or who to marry. Why does this happen, and how can we strengthen our decision-making skills?
Listening to other people’s advice and spending too long agonizing over the pros and cons of a decision are the main reasons we make bad decisions. Using intuitive decision-making, or the natural feelings we have about a situation often serves us better than rational thought.
Follow these tips to use your intuition better when faced with a tough decision:
Mirror, Mirror on the Wall
Look in the mirror when you’re thinking about a decision. Do you look happy, angry, sad, or frightened when you think of a particular solution?
If you look scared or sad when thinking about a decision choice, you should examine why you exhibit that emotion. If you make a decision despite having negative emotions about it, it probably won’t work out the way you want.
A happy or satisfied look is a sign you’re on the right track with your decision. A person who’s about to get married may sound enthusiastic, but she may have a sad or worried look on her face when talking about her boyfriend.
This facial expression indicates that she is lying to herself or hiding problems that should be dealt with before marrying, or that she shouldn’t marry this man at all.
Listen to Your Voice
Study the sound of your voice when you talk about various solutions. Do you sound scared, enthusiastic, confused? If you sound enthusiastic, you should probably go with that decision. If you sound scared, avoid making that particular decision. ,
You may tell someone that you feel happy about moving to a particular city. Still, your voice communicates nervousness or sorrow when you talk about it. You should review your plans if your voice and your intentions don’t match.
Record yourself talking about prospective decisions on your phone or audio recorder. If you sound nervous, sad, or angry, when talking about a particular course of action, you should avoid it. Do you sound happy or intrigued about another decision? You should probably follow through on that course of action instead.
When your voice, facial expression, and what you’re saying are in sync, you’re making the right decision.
Pay Attention to Your Actions
Your words, facial expressions, and tone of your voice are indicators of how you really feel and what you should do. Your actions and behavior are better indicators of the truth behind your feelings.
Some people may think an uncomfortable or nervous feeling about a job or relationship is normal. If the feelings become too overpowering, look at your behavior. Do you say you love your partner, but avoid being seen in public with him? If so, look at the reasons for the disparity between your words and actions. You need to repair the relationship or leave it.
Be Aware of Your Senses
Intuition indicates stimuli that can’t be identified at a conscious level. Increasing your awareness of your senses-taste, touch, smell, sound, etc., will put you in closer touch with your intuition. When you take a walk or jog, pay more attention to the flowers, leaves, lawns, animals, and the sounds around you, like children playing or lawnmowers.
Listen to the sounds of peoples’ voices before a work meeting, how they move, and the smell of coffee from take-away cups. See if your interpretations of people are accurate based on this sensory data.
If you’re sitting next to a friend, and she suddenly pulls away after you’ve said something you thought was innocuous, you may want to examine why your friend moved. Was she insulted or hurt by what you said?
Listen to people when they speak, and note pauses or any hesitancy in their voices. You’ll also want to note body language and facial expressions. Someone interviewing you for a job may seem friendly, but shuffle papers or tap his feet, which indicates he’s not really interested in what you’re saying.
If you feel uncomfortable around someone, but can’t figure out a surface reason for it, look at sensory information like the tone of their voice, body language, and facial expressions for an answer.
Use Visualization
If you’re uncertain or anxious about a decision, it helps to visualize what would happen in each of the options you’re considering. You may visualize contentment, friendship, and joy about a move to Chicago, but only loneliness and joblessness about a decision to stay in Los Angeles.
In that case, you should move to Chicago, as your intuition indicates there is nothing positive about staying in Los Angeles
Learn how to read your feelings – both good and bad. These feelings can tell you a lot about what decisions you should make to have a better life.
If a potential job requires you to travel and be away from your family regularly, you need to ask yourself if the money is worth it. Visualize yourself with your family at Christmas dinner. Then visualize yourself alone in a hotel room, Skyping them on Christmas Day.
You may feel depressed about being away from your family during the holidays. However, you may feel confident that you’re doing the right thing by earning more money to secure a better future for your children. The temporary separation may be worth it if you’re making more money for your children’s college fund.
If you’re contemplating a new job or a move, visualize yourself traveling to the job or city. Think about interacting with the people, what your home or apartment would be like, how you would spend your weekends, and what sort of friends you would have. What about your family? Would they enjoy the new city, or have difficulty adjusting?
Visualization taps into our emotional reaction to a decision, which often tells us more than logic.
Rely on your intuition in cases where facts and figures won’t lead you to the best decision.
Why Intuitive Decision Making Works
Intuition may be more efficient than rational decision making, according to research cited in the Journal of Organizational Behavior and Human Decision Processes. Researchers from Boston College, Rice University, George Mason University, studied gut instinct and its relevance to decision-making.
One of the co-authors, Michael Pratt from Boston College, says that there are situations where intuition is favored over logic in decision-making. People can use their gut instincts when making a broad evaluation, according to the study, if they have domain expertise or knowledge of the subject.
When there aren’t any minor decisions piggybacking on the major decisions, intuition was shown to work better than logic. Organizational psychology expert Pratt notes that the research findings will help CEOs and employees learn more about when to use intuition instead of rational decision making.
Even so, business people need to be careful when using intuition over structured analysis. Use your intuition if you’re in an industry where you have experience and domain expertise. If you are in a new career field and have little domain expertise, it’s better to use rational decision-making.
Use your gut instincts for decisions in familiar industries or areas where you have lots of experience.
In your personal life, gut instincts will tell you what to do if you’re experiencing a scenario for the fifth, sixth, seventh time, etc. Older adults will be better able to trust their emotional response to a relationship or job offer because they’ve experienced these situations many times.
Younger people don’t have that job or relationship experience to draw on, and they may be dependent on other people’s opinions or other external factors.
What the Research Shows
Now that it’s more essential than ever to make quick decisions, intuitive decision-making has gained popularity. The slow, step-by-step process of rational decision-making isn’t as revered as it was in the 20th Century.
Pratt and his fellow researchers noted that past studies compared analytical decisions, which break down large problems into smaller parts, with intuition. Intuition concerns patterns and whole concepts to determine what’s real, right, wrong, or fake.
The researchers conducted an experiment that asked a small group of people to think intuitively and make quick decisions. Another group was asked to take a rational approach and use more time to decide.
The intuitive group watched a videotape of a college basketball game. The group had a few seconds to rate the difficulty of the shots. The viewers who had experience playing basketball rated the shots similar to the standards of NCAA coaches.
The intuitive group was also asked to differentiate between real and fake designer handbags. Members of this group who had owned designer handbags made quick, accurate judgments about the items.
Domain expertise is crucial to intuitive judgment, in the workplace and in individuals’ personal lives. The popular managerial approach of moving employees to different departments and teams may not improve the decision-making process.
Employees may be more well-rounded and know more about the company overall. Still, these employees won’t have the domain expertise to make intuitive judgments in any area.
Sixth Sense
The sixth sense is an ability to locate information other people, and formal research may miss. It’s the opposite of analysis that involves facts, metrics, and step-by-step research.
Let’s look at another example of intuitive decision making:
A manager at the local coffee shop notices that pastries are missing, even though the store isn’t selling that many sweet baked goods.
The manager doesn’t have the time or budget to hire a company spy. She needs to fire the person responsible without wasting a lot of time on formal investigations. The manager relies on studying body language, eye contact, and daily habits of employees to determine who is stealing the pastries.
She’s noticed that Dan, the new hire, disappears for longer than allotted times during his breaks. Dan says he’s going outside to smoke cigarettes, even though he’s never been seen smoking or holding a pack of cigarettes.
The pastry case always has to be replenished after Dan leaves for a break, too. Therefore, this makes Dan the prime suspect in the pastry thefts. The manager didn’t need data, analytics, or a special company spy to figure out who stole the pastries. Her decision relied on intuition.
Managers and other business people need to use their gut instincts to make quick decisions in stressful situations. Many businesses prefer to use research and data-gathering to make decisions, but this isn’t always possible. Intuition is essential to scientists as well as business people.
Anton Zeilinger, an experimental physics professor at the University of Vienna, says that you should trust your own feeling and intuition. “Intuition guides me, gives me a feeling about which direction I should continue in,” he says. Zeilinger conducted research that discovered breakthroughs in quantum teleportation and quantum cryptography.
KTM, a manufacturer of off-road motorcycles, entered the street motorcycle field. The company had no experience in this field. The owner, Stefan Pierer, had a gut instinct told him to get into the street bike field.
KTM soon became Europe’s second-largest street and sportbike company. In 2006, the company derived 29 percent of its revenue from sport motorcycles. KTM experienced 15 years of 25 percent revenue growth. According to Pierer, intuition is an asset in making business decisions.
A rational argument may indicate one thing, but sometimes the gut instinct overrides it.” I wake up in the night and have the feeling that I should do it differently after all,” he says.
Traits of Intuitive Decision Makers
Why do some people have better intuitive decision-making skills than others?
In the game of chess, some grandmasters play up to 50 games at one time and make quick decisions as they move from board to board. In tournaments with other grandmasters, every grandmaster makes a decision about where to move a piece within seconds.
A top competitor spends any time left thinking about the move and whether or not it was correct. How can a grandmaster make a correct decision in a few seconds? This ability may have a lot to do with recognizing patterns quickly.
In one experiment, novice chess players arranged six of 25 pieces correctly during a normal game. Chess masters were able to position all 25 pieces correctly. The chess master must have stored a lot of visual information to help them do this.
When all the pieces were placed randomly on the chessboard, the masters and inexperienced players positioned six pieces correctly. A grandmaster has the experience to see patterns behind configurations for the game. There are about 50,000 configurations in chess, according to one estimate.
Intuitive decision making and the ability to recognize patterns quickly often happens unconsciously. This ability to recognize patterns is important for making complex decisions. The neuroscientist Professor Gerald Hüther at the University of Göttingen in Germany, states that the brain operates like a computer when making trivial decisions.
Making complex decisions involves experience, emotions, and knowledge or the process people call intuition. Studies have found that people who are curious, open, and have vast experience can reach intuitive decisions more readily than people with less experience.
People who are quick to seize opportunities also have intuitive decision-making skills.
Executives and Intuition
Intuition isn’t magic or something “New Age,” and it’s not that different from reasoning. Intuition is a complex, developed type of reasoning based on experience and knowledge. If you have patterns, concepts, procedures from years or decades of experience stored in your head, intuitive reasoning should come easily to you
However, if your intuition has failed you, can you improve it to make better decisions? Management science has only studied intuitive reasoning for a short time, but here are some tips from the research:
Tap into Your Experience
The more experience you have, the better you’ll be at discerning patterns of behavior. An executive who says he or she made a great gut instinct decision is actually referring to experience. Psychological research shows that a person needs ten years or more of specific experience in a certain field or realm to make the right instinctive decisions.
In business, top-level executives make more correct intuitive decisions than lower-tier managers. Small business owners make the same number of intuitive decisions as executives in large companies. Experience is the key to good decisions, not the size of the company or the amount of the executive’s paycheck.
Networking
Executives should surround themselves with a brain trust of business and personal associates who can help them make better decisions. Learning from others is one of the best ways to improve your intuitive ability.
Networking also helps the average person improve his or her intuitive reasoning. Meet and talk to different types of people. Learn about trends from young people if you’re an older adult, or history if you’re a young person.
Having a wide range of friends and acquaintances will open your mind and help you understand more about the world. Broader knowledge helps you make better personal decisions in relationship and social matters.
Emotional Intelligence – Understanding Yourself and Others
The amygdala, a peanut-shaped site in your brain, houses emotional memory, and it sifts through triggers and stimuli faster than cognition. Emotions come before cognition, according to neuroscientist Joseph LeDoux.
Daniel Goleman, psychologist and author of the book “Emotional Intelligence,” states that 90 percent of the differences between average and top-performing executives have to do with emotional intelligence. In a nutshell, emotional intelligence concerns identifying and understanding one’s emotions.
Showing Tolerance
Intuition develops in an environment that includes positive and negative experiences. In business, this means top managers need to tolerate mistakes. Top executives at a company should publicly support employees who take risks and fail.
Peter Brabeck-Letmathe, Nestlé S.A. CEO, looks at an executive’s defeats as well as his or her successes. “Only someone who has some failures to show in their history can carry out a leadership role in a forward-looking way,” he states, “because only then is it clear that the person was willing to take risks.”
Open-Mindedness
Executives should stay curious despite the demands of their jobs. Open-mindedness is necessary to discover new products and opportunities. Peter Drucker, the author of dozens of renowned business books, writes that good managers focus more on opportunities than risks.
Exploiting opportunities, not worrying about problems, is necessary to move things forward. You need to think and act in a way that leads to new opportunities. New opportunities lead to new experiences, and more experiences improve intuition.
Disciplined Intuition
You shouldn’t let your intuition, or “hunches” run wild. Combine intuition with observation or fact-checking to be successful. Executives need to reflect on intuitive decisions before executing them briefly.
Making Your Own Luck
The best executives seem to be lucky and encounter a lot of chance opportunities. Some people are better at recognizing opportunities than others. These executives see patterns and weak signals before other people. Executives and others then use this “luck” to seize an opportunity.
Hans Hinterhuber, a University of Innsbruck professor emeritus, states that these decision-makers are able to filter out useless and contradictory information and use only necessary information for strategic, intuitive decisions.
René Obermann, the former T-Mobile CEO, who is now CEO of Deutsche Telekom, explained why this ability is important in a 2006 interview. Obermann noted that quantitative market research didn’t predict the public’s enthusiasm for mini-personal computers, wireless email, and text messaging.
Due to the failure of quantitative market research, T-Mobile turned to qualitative research and intuition to develop new products. Experience and intuition help management teams make better decisions than quantitative market research alone.
Data overload has caused many business people to burn out on numbers and analysis. Use knowledge and experience, along with emotional intelligence, to find new opportunities others may miss. Help employees and executives make their own luck by fostering an atmosphere that develops curiosity, risk-taking, and intuition.
Mindfulness and Intuition
Practicing mindfulness can improve your intuition. Mindfulness means you’re fully living in the moment and paying attention to what’s in front of you. You’re not concerned with the past or the future – you’re living now. You observe all that’s happening around you without judgment.
Being mindful reduces the problems caused by cognitive bias in decision making. If you accept your limitations, you can reduce the chance of arrogance and the rash decisions it causes. Mindfulness offsets stereotyping, sunk cost fallacy, and helps you learn from experience.
Being present in the moment can help you tame behavioral issues that cause bad decisions. Being mindful of your behavior can cause you to control anger, procrastination, and anxiety, for example.