An insightful review of Michael Mauboussin’s new book, Think Twice, focuses on decision-making, and, specifically, the making of bad decisions.
As Susan Berfield, the Businessweek reviewer emphasizes, one of of the
most galling aspects of the financial crisis is that intelligent people
made so many decisions that later seemed pathetically wrong.
Mauboussin argues that in order to make good
decisions you often have to think twice, a task that we’d rather not
do. The reviewer surfaces a number of highly relevant decision-making
rules, but emphasizes one that’s hot today: intuition. Research
suggests that intuition is really swift pattern recognition based on
experience. In other words, smart intuition is a skill that comes
along after years of successful development and experience. Gut feel,
which some claim early on, has little potential for accuracy. I’ve
referred in the past to a wise, inexperienced MBA whose boss kept
urging him to go with his gut. My client, the new MBA, said he hadn’t
had enough experience to have trustworthy intuition. An astute, even
wise personal assessment!
Although many are familiar with the differences
Gladwell suggests in Blink, Mauboussin is more scientifically accurate
in his recommendations: “Intuition only works well in stable
environments, where conditions remain largely unchanged, where feedback
is clear, and where cause and effect are linear.”
We can train our gut to produce more reliable
responses, but as the author suggests, I think it’s wiser to recognize
the limits of intuition.