Thursday, September 3, 2009
Strategic Decision Making: The Dueling Dualism of Intuition and Analysis
Ten Ways Analysis Serves As a Check on Intuition
By Dr. Julia Sloan
julia@sloaninternationalconsulting.com From the research-based book
Learning to Think Strategically by Julia Sloan (Elsevier)
Unpredictable economies. Changing regulation. Political shifts. Cultural challenges. Sour markets. Now, go create an innovative winning strategy!
Amidst the current business confusion and turmoil, how should business strategists approach this coming round of strategy meetings? Hard-core analysis? Or soft-core intuition?
The strategy reality is that intuition and analysis are a dueling dualism. Unfortunately, intuition and analysis are often regarded as an either-or decision in which one or the other must be eliminated, rather than as a dualistic "and" decision in which both play a complementary role.
In an effort to strengthen strategic decision making, leaders must be mindful and adept at integrating the roles of intuition and rationality. Analysis and intuition work together in the human mind. One of the hallmarks of a successful strategist is adeptness and agility at using analysis and intuition - an ability to engage in "and" thinking or polarity thinking. Research shows that strategists who do not or can not trust their intuition are less successful and less innovative strategic decision makers; and as long as they reject their intuition, they're destined to remain so.
When the circumstances continuously change, when the time pressure is high, or when goals are vague, we cannot merely use analysis. We have to go with what we "know" These situations require risk taking, but they can also yield strategic rewards if we invest in building a repertoire of successful intuitive experiences. By contrast, when our strategic decision involves a lot of computational complexity, such as determining whether there is a cost advantage, we're doomed or duped if we don't do the analysis.
Rational analysis can never substitute for intuition within the process of strategic decision making. While analysis has its function and intuition is not perfect, trying to replace intuition with analysis is a huge mistake, if the intention is to make innovative and sound strategy decisions.
Although intuition is the driver of strategy, analytic thinking is essential for beginners and experienced strategists alike. A real competitive advantage is to strengthen intuition so that it becomes more accurate and provides us with better insights. In this strategic environment of complexity, ambiguity and paradox, analysis will take us only so far.
Intuition As a Check on Analysis
When it comes to strategy, numbers are not necessarily the panacea we're taught to believe. Numbers are not necessarily any more trustworthy than intuition. Our intuition keeps us anchored to our surroundings and oriented, while our analytical abilities, allow us to think sequentially and precisely. Because our intuition can mislead us, we often opt to monitor and report events using objective, numeric measures - which are quick and easy to share. Relevant or not, this feels safe.
When making strategic decisions, we shouldn't blindly follow our intuition, or we'll be bamboozled -- as intuition can be unreliable and requires monitoring. Yet, we shouldn't suppress our intuition either, because it's essential to our strategic decision making and cannot be replaced by analysis or procedures. In short, there's much more to a strategic decision than latching onto a chain of numbers.
How does intuition keep analysis in check?
Intuition helps us determine what to pay attention to.
Intuition helps monitor our attention by signaling us to be alert in high-stakes situations.
Intuition can help us spot problems early on and warn us that our decisions and actions based on those decisions are insufficient to reach our goal.
It's our intuition that enables us to pick up on subtle inconsistencies in patterns. This triggers a feeling which then leads to a certain decision or action. Because of this, we draw confident conclusions from very little information.
Intuition is what we use to see patterns when we look at data and facts. Because patterns are not always linear, they're not always obvious. That's when intuition becomes our best friend - we scan a set of data or variables and a pattern pops into our mind. Our experience is what arranges things into patterns and intuition allows us to decipher patterns.
Intuition is what waves the "red flag" in front of our face about specific circumstances during a strategy assessment. Intuition helps us recognize situations as unusual or problematic because of our experience.
Intuition helps us unravel messes in problem assessment using experience.
Intuition is what identifies our feelings and intensity about a correct decision.
In the decision-making phase, intuition is what allows us to form a first opinion/hunch.