Phil's blog

Hard Facts, Dangerous Half Truths and Total Nonsense: A rant about Instinct vs Evidence

Aug 17th, 2006 | Leadership | 0 Comments »

I’ve been working with the UK’s National Health Service recently and have noticed the welcome emergence of Evidence-Based Medicine as a better way of reaching decisions than doctors relying on habit, their own relatively narrow experience, hierarchy (“I’m the consultant, therefore my decisions must not be questioned”), and the mystique of their own expertise.

Bob Sutton and Jeffrey Pfeffer have a new book out, partly inspired by Evidence-Based Medicine. In their book, Hard Facts, Dangerous Half Truths and Total Nonsense , they draw on the growth of Evidence-Based Medicine as a discipline and call for a parallel growth in evidence-based business decision-making instead of instinct.

BUT, I’m not so sure. Intuition and instinct are not always based on “Dangerous Half Truths and Total Nonsense” as the title of their book says. They are actually often sub-conscious, fast ways of processing, accessing and aggregating evidence and then reaching a swift conclusion.

Leaders need more of both – a clear-eyed focus on the relevant facts and evidence (rather than evidence that promotes a particular agenda or perspective), PLUS more reliance on individual and collective instinct.

I’ve got a couple of great examples of the power of instinct somewhere. I’ll dig them out and post them. One’s to do with finding fish, the other with how George Soros’ gets a back spasm when he’s about to make a ‘wrong’ investment decision.

Leaders and Instinct: How George Soros makes investment decisions and how Kjell Nordstrom’s dad finds the fish

Aug 17th, 2006 | Leadership | 0 Comments »

I was invited to become an Execubooks blogger. Apparently they think I am a ‘business thought leader’. That’s enough laughter, thank you; I can hear you from here. Anyway, we were asked to blog last week about the emerging field of evidence-based management – incidentally, just why is this an emerging field? Weren’t we always supposed to base our decisions on the best evidence?

Professor Bob Sutton of Stanford University (whose thinking I’m a fan of) posted something I disagreed with profoundly. He said this, in favour of evidence-based management, “…organizations that rely on facts rather than intuition can outperform the competition”

Aaaggghhh! Facts and intuition are false opposites. Leaders should listen to their intuition and instincts (and allow others to do the same) because they are sub-conscious, fast ways of processing, accessing and aggregating evidence and then reaching a swift conclusion.

Here are two examples of how intuition or instinct are often alternative words to describe how we tap into what the knowledge experts call tacit knowledge – things we know but just can’t articulate.

I’ve just noticed both examples are about fathers, which is an odd coincidence.

The first is from Malcolm Gladwell’s book Blink. Here it is:

“My father will sit down and give you theories to explain why he does this or that,” the son of the billionaire investor George Soros has said. “But I remember seeing it as a kid and thinking, ‘At least half of this is bull.’ I mean, you know the reason he changes his position on the market or whatever? It is because his back starts killing him. He literally goes into spasm and it’s this early warning sign.”

I interviewed the economist Kjell Nordstrom and he told me this story, which shows the power of instinct and that as a leader you need to find room for it as we try and move managers towards better decision-making:

“My father’s a fisherman living on the coast of Finland. He has been all his life. Occasionally he takes me out fishing in his boat. After a while, I’ll say ‘This looks like a good spot. Let’s stop here and fish.’ My father will just smile and say ‘Not today. Today the fish are over there’, and point a mile or two to the west.’ And he is nearly always right. I have given up asking how he knows. He looks at the weather, he looks at the water, he feels the wind, he feels the air pressure, he absorbs all these things and he just knows where the fish are. He feels it.”

Tags: George Soros, instinct, investment, kjell nordstrom, leaders

Leadership & Strategy: a Eureka! moment

Aug 16th, 2006 | Leadership | 0 Comments »

I’ve been reading Henry Mintzberg’s Strategy Bites Back and it’s a breath of fresh air. Some choice soundbites from the book:

“Everyone knows where a straight line goes… but a squiggly line can go anywhere. Computers generate straight lines. Life generates squiggly ones. That’s why your predictable business strategies never turn out the way you expect.”

“Strategy is when you are out of ammunition, but keep on firing, so the enemy won’t know.”

“When in doubt, use a bigger hammer.”
– Dobin’s Law (predicated on that famous maxim that to a man who has a hammer, everything starts to look like a nail. In other words, an inflexible strategy can programme your organization’s actions and responses in ways that are too rigid and often inappropriate).

“This is the course in Advanced Physics. This means the instructor finds it difficult. If he didn’t, it would be called Elementary Physics.” – Louis Alvarez, Nobel Laureate

“Strategies are to organizations what blinkers are to horses” – Henry Mintzberg

Strategy and Execution

Mintzberg’s most profound insight into strategy, which was a real Eureka! moment for me when I first read it, is this:

Strategy and execution are not mutually exclusive and they are not sequential. There isn’t the neat division between the two that most management schools like to teach. This is what Mintzberg gets and other strategists don’t.

Mintzberg’s insight says strategy doesn’t necessarily come first (‘think’ then ‘do’): it’s not that simple a divide. Strategy and Execution intertwine, so stop separating them in your head.

“Virtually everything that has been written about strategy-making depicts it as a deliberate process. First we think, then we act. We formulate, then we implement. The progression seems so perfectly sensible. Why would anybody want to proceed differently?” he writes.

He goes on: “While it is certainly true that many intended strategies are ill conceived, I believe that the problem often lies one step beyond, in the distinction we make between formulation and implementation, the common assumption that thought must be independent of [and precede] action…Smart strategists appreciate that they cannot always be smart enough to think through everything in advance.”

Yes, yes, yes. Eureka! Why do so few other get this? Including some of those billed as the biggest experts on strategy in our time? Breaking the distinction between Strategy and Execution frees leaders up to be more agile and flexible. Thank goodness for Henry Mintzberg.

Tags: Eureka, Henry Mintzberg, Leadership & Strategy