Intuition, brain and business in bad English for English readers

IMG_4142In Holland my book ‘The high speed brain’ appeared at the end of March 2015 and has reached the top 10 in my country. Until now there is no English translation. Some English speaking people asked me if it was possible to do a translation in English. My  English is not so good so I took the Google translator. Which still means that I have to spend much time on translating. But I think I managed to do it in understandable English. I hope you can see it as a service.

THE HIGH SPEED BRAIN

Decisionmaking based on intuition

Bert Overbeek

“Have the courage to follow your heart and intuition. They somehow already know what you truly want to Become. Everything else is secondary “- Steve Jobs

Introduction

“I believe strongly that eventually only those companies will survive that are able to flexibly adapt to changing market conditions. Organizations really have to, because technological developments follow each other faster and faster. “So says Pim van der Hagen, CEO of a company in credit management software. In an interview with him on the Internet, he stressed particularly the importance of IT for the future. In decision-making, however, involves more than advanced technology. Michael Kortbeek, president of the Chamber of Commerce agrees. According to him, the challenge for companies will be “to be more agile and faster.” Governments need to make faster decisions and businesses should shorten the payback on their investments. ”

The communication of the 21st century will require quick decisions. And to make not only quick but also good decisions, you need the right data. The problem is that these are not always at hand. Yet situations ask constantly that you make a decision. So you have to discover something else than data. And a popular idea these days is the idea of “Follow your intuition.” Intuition would help to improve decision making. For this reason I wrote this book on intuition and decision making.

Intuition has been discussed often. It is a popular topic. Everyone has an opinion about it. In conversations with friends and other people about the subject of this book, most of them spontaneously began to tell what intuition was according to them. I found that very interesting. Everyone seems to think something about intuition. And there is said a lot about it. And a lot of positive things. The question is whether all this positivity is not getting the wool pulled over our eyes.

What can you do with intuition in everyday’s life? Can you use it when you have to take important decisions? Or should you just be careful, and use anything else? And what exactly is intuition? Is it, as people used to think a voice from heaven? A feature? The voice of your heart? Recent brain research provides an answer to these questions and gives us new views on the subject.

I will write about these things in this book. I promise in advance that it is not a technical book with all sorts of jargon. Where concepts are complicated, I will try to simplify them for you. It is very rewarding to know what intuition can do and can’t do in a world of flash decisions. This book will show you the advantages but also the disadvantages. The many practical examples from business will guide you through the research and insights about intuition. Each chapter will end with tips that you can apply immediately in your everyday’s practice. My intention is to help anyone to take advantage of intuition as a tool for fast decision making. I write this book so that readers can discern what makes their decisions well. I cetrainly will quote and discuss a few special individuals from the management and scientific world. Where I discuss them, I will do so in understandable language. Not because I underestimate you, but because I know the jargon in both worlds is sometimes inaccessible.

And there is also another reason. It seems a clever idea to properly understand what exactly is intuition. There are those who say that you should have complete confidence in intuition. I see that people are unhappy because they did so and things went amazingly wrong. You also proving yourself an enormous favor if you learn to know the qualities and pitfalls of your own intuition. This in order to keep the quality of quick decisions as high as possible. And you can instantly begin with after reading this book.

I am very grateful to Gary Klein and Malcolm Gladwell who went into the beautiful jungle of the subject before. My opinions will approach their conclusions. But there is an addition. And this addition is the modern brain research. The combination of modern brain research and Klein and Gladwell brings new views and ideas. You will find them in this book.

Chapter 1. The need for quick decision

In the past 10 years the speed in the business world has increased dramatically. The world is through technology, modern media and communication more connected. So the competition has increased enormously. You swould expect that organizations make their decisions faster. However, the opposite is the case, as it appeared in 2011 from the so-called Game Changer Report of the Economist Intelligence Unit. And the consequences can be quite nasty. 80% of the 390 interviewed multinationals admit that it is important to respond quickly to change. But only 22% take faster decisions; 50% of the organizations take more time for their decisions than before

Many organizations are not equipped for the modern age. 60% of surveyed executives believe that this applies to their organization. Organizations and their employees tend to to hold on to how things always have been. Managers must make clear that the climate in which they do business will change more and more rapidly.

Thus the time of quiet analyzes come to be at risk. The project structures and models that you learn at colleges and universities no longer seem to work quite right. The world is an Adhocracy, a structure which is not bound to many rules and processes. In this world you are constantly overtaken by new developments. You can not sit and wait for data that are already obsolete tomorrow. So you have to find a solution fort his problem, otherwise you will not make it.

Are you yourself already prepared on the speed of modern times? The Dutch writer Harry Mulisch once wrote that our spirit doesn’t travel as fast as an airplane. Your body is already at the destination, but your mind needs more time. Something like this is also the case with decisions. Situations are ready for a decision, while our mind is not yet there. Markets are fickle, the business world is yeasting. The data from this afternoon are obsolete tonight. For decision-makers this is particularly difficult. And then there are the management gurus who tell you to take two seconds decisions. They assure you that then it’ll be fine. Just follow your heart and your intuition, they preach enthusiastically. They are presenting books, which are peppered with examples of success of their methods. And which CEO doesn’t want to take a bite from that cotton candy?

So you wonder: do they actually take a bite from that cotton candy? Do they follow their hearts too? They will if they say, you might think, but unfortunately not all of them do. There are in the business world a lot of traditionally minded people, who use all kinds of fashionable clichés to generate a fashionable impression. Phrases like ‘. You have to follow your passion “” I do not like a 9 til 5 mentality’ ‘You must do what you like. “” If someone is not working you just fire him,’ And ‘follow your heart. “. The downside to those cliche phrases is that they are keeping up appearances in stead of reflecting the truth. Too many people are preaching things that they don’t practice.

And that goes also for the 2 second’s decision. It is impressing when you are able to make quick decisions. So sometimes managers pretend that they do so. And maybe they believe it themselves, because all kinds of research show that we tell factual inaccuracies without wanting or realizing it. So I went with a healthy dose of suspicion to my network to see how decision makers deal with data and intuition. I did a little research among 15 people I knew, including many decision makers. The number of interviewees is far too low for a representative sample, but it gives an image. Take a look back to the score.

Functie Intuition (%) Analysis/data (%) Rely on intuition (%)
CEO 80 20 100
Manager Operations 60 40 100
Sales Manager 80 20 90
Higher management 70 30 90
Entrepeneur 35 65 30
CFO 30 70 100
Entrepeneur 80 20 10
Manager 50 50 100
Director 50 50 50
HRM manager 60 40 70
HRM manager 80 20 80
Director 90 10 80
Trainer 60 40 70
Manager 95 5 99,5

The score is in favor of intuition. Analysis is scoring lower on average. The average age of this group is 45+. People who are younger than 40 are scoring 35 and 30 on intuition. Are these random scores? Probably not. Age appears to play a role. When asked, 90% of my target group maintain that they have come to rely on their intuition only in recent years. And one of the younger respondents said she still doesn’t dare to rely on her intuition. Moreover the relationship between age and intuition was recently laid by my 82 year’s old mother. She finds that her intuition is enormous tightened now that she is old. Intuition is especially trendy for people who are in the second half of their lives.

Anyway, trust in intuition turns out to be very high to my interviewees. This result is not confirmed by research, as will be seen shortly. Apparently it matters how old the audience is that you are investigating. So perhaps it will be surprising to do some research in your own office.

Decision making, data and intuition

I will focus on more responsible research. And I like doing that with an example. Imagine that you had been the CEO of Nokia a few years ago. You had 40% of the market share with your product and you remarked that the smartphone was coming up. You had to make an important choice: follow the developments or not. Your advisers would say that the smartphone was a serious competitor, but you ignored the data, made an assessment and noted -against the common expectation- that the smartphone would have hardly effect on your market share. Because you feelings have rarely deceived you. So you would take a decision. You were not following the smartphone hype. You would take the decision because your intuition told you that it is a good decision. You followed your inner voice. You didn’t know good arguments but you trusted your feelings. What would you have done? Ignoring the data? Choosing for your feelings? And if you would, would you belong to the majority or the minority of people? For the record, this story had disastrous consequences for Nokia.

The importance of data is quite propagated in some circles. They are seen as the eureka for the future, just as in other circles intuition. Quarterly Adobe is analyzing 1.7 billion customer transactions. Redbox.com is using data for analysis of customer needs, effectiveness of campaigns, product promotion and for quickly identifying market opportunities. This has led to a significant increase in online revenue. Their marketing campaigns has become measurable, so they can act quickly when something is happening in their market or with their customers.

Let’s see how the handling of data goes in business, before we delve into intuition.

-An analysis of Cap Gemini under 600 top managers shows that 9 out of 10 managers consider’ big data ‘ as a fourth factor of production in addition to land, labour and capital.

-There are organizations that have come to perfecting the access to data and they were improving their business performance with 26%.

-The research states that according to their managers 2/3 of the organizations are datadriven. This means that the collection and analysis of data is at the base of their business strategy. Intuitive leaders are increasingly rare according to this research.

-54% of the managers is rejecting management decisions based on intuition;

-65% believes that decisions should be based on hard analytical information.

Another study, by NetApp, comes with additional dates.

-Decisions have to be taken faster and faster.

-45% of the decision makers are not able to follow that pace while 48% of decision makers indicates that slow decision have a negative impact on revenue.

-44% indicates that they even have lost customers.

-In 76% of the cases decision makers are not able to reach the relevant data in order to optimize the business processes and to stay ahead of competitors.

-Only 4% of the decision makers thinks that intuition is more important than dates.

-However, 74% of the respondents said that they take strategic decisions without data. This is because such data are difficult to find.

-90% of respondents therefore has plans to make their data more convenient and better for analyzis.

If you are reading this, you get the feeling that you are doing something risky when you take a decision without data because you are afraid to make the wrong decision: decisions on feeling (such as in the Nokia sample) is not without risk. On the other hand, many people admit that the correct data often are not found, and the same goes for data experts. NET marketing e-zine Emerce wrote about this:

“We hear a lot about Big Data, but experts must actually be able to do something with it. A mixture of insights, analysis and behavioural information should identify the right customer. For example, major retailers always have an advantage because they can gather and analyze more data. It’s the question whether your current team has this kind of expertise. Good data scientists are not easy to be found. Maybe they understand the numbers, but they do not think strategically. If you don’t have the right people, you better work with external parties. The question you have to ask then, is: How do you deal with the difficult access to data?

We continue with online magazines, in this case Computable. The investigations of Cap Gemini and NetApp are a few years older (2011) than those of Computable (2014) and the results are not the same. In the Computable investigation 30% trust on their intuition and 28% on the intuition of others. And 46% indicates that choices based on big data can have a wrong effect. I quote:

‘ Many managers base their decisions not on available data, but rather on the basis of intuition and experience of themselves and others. 3 out of 10 managers trusted their intuition at their last big decision. 28 percent trusted the intuition or experience of another. Only 30% of the managers indicated that use was made of big data and 9 percent bases decisions on financial indicators. Nearly half (46 percent) of managers considers that a choice based on big data adverse consequences appeared to have for their business. This is according to them, mainly due to the quality, accuracy and completeness of the data to be desired. ”

Like artists inventors and writers more and more managers are impressed by intuitive hunches and by’ Flash ‘ decisions as they are also called. Yet there is a difference, whereby a large part of the managers is reluctant with intuition. Choosing a different color for a painting or a different way of making music has not directly the result of a financial debacle. A mental choice can have far-reaching effects. When you’re one of the 12 publishers who rejected JK Rowling on the basis of an inner voice, you will better understand the value of well balanced decision and won’t advise people to follow their hearts. Because your heart has been whispering that JK Rowling was not something really special.

(Did you notice that in this chapter different studies show different results. That’s right and it is a conscious decision. We namely run against the limitations of data. We see opposites in the three examples above. Can you imagine how this will be with thirty, fifty or a hundred examples. It only shows how difficult it is to get the right data.)

Bert Overbeek is personal and team coach and into management development. His work is much based on recent research about the human brain and mind. 

To be continued

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