It’s a common saying that we hear when we’re faced with a tough decision: “Just go with your gut.” But in my interview with Gleb Tsipursky, author of Never Go With Your Gut: How Pioneering Leaders Make the Best Decisions and Avoid Business Disasters, I learned quite the opposite.
Instead of leading with our emotions, which Gleb says inform 80-90% of the decision-making process, we should be checking in with our cognitive biases. That’s why Gleb’s book focuses on “the thirty most dangerous cognitive biases for business situations [and] for business leaders and how you can address them effectively going forward.”
Sound intriguing? Then keep reading. I know you’ll enjoy this eye-opening topic just like I did.
The Inspiration: Gut-Based Decisions Lead to Suffering
Gleb gets sad, frustrated, and angry when he sees leaders making decisions based on gut instincts. But where do these reactions stem from? Gleb explained, “I grew up around the “.com” boom. […] I was 18 in 1999 when little companies like web band, boot.com, and pets.com […] were really booming.” For a little while, tech leaders were featured on the front pages of the Wall Street Journal as the Titans of Industry. But by 2002, only a couple of years later, the “.com” bust hit, and all of the sudden those same leaders were in the Wall Street Journal “for all the wrong reasons.”
Gleb recalled: “People lost their life savings. Ordinary folks lost their homes. Their savings. There was someone I know actually who had a pretty serious suicide attempt as a result of that.”
And it was all a result of bad decision-making on the part of people we trust. They went “with their gut,” and when the businesses began to tank, they used “fraudulent accounting methods to hide their losses.”
According to Gleb, when we make quick gut-shot decisions based on our cognitive bias, we “lose so much more than we gain.” This led Gleb to pursue a degree in neuroscience and eventually study cognitive neuroscience to begin to understand how our brains cause us to make certain decisions in financial settings. His 15 years in academia and his 20 years of consulting, coaching, and training business leaders all led him to write this eye-opening book on how to make smart decisions that will lead to business success.
The Outcome of Bad Decision-Making
One of the many problems with poor decision-making is that business leaders may not realize the effects of such a decision until it’s far too late. Gleb said, “Right now, we’re discovering that GE made some terrible, terrible decisions at the beginning of the millennium […] when they chose not to invest in green energy. […] They really missed the boat, and their finances have greatly suffered because of that.” And this is just one example of finding out when the “ship” has already sailed.
So, What Is The Gut Instinct?
What is it about the gut instinct that makes us so quick to trust it? It’s simply the fact that it feels comfortable. Trusting our gut just feels right, and it’s our instinct to trust what feels good to us.
According to Gleb, the gut instinct originates in the Savannah Environment. When we were in small tribes, hunters, and gatherers of 15 to 150 people, we adapted to trust our gut instinct. One aspect of this instinct is the “fight or flight” response to conflict.
Gleb then brought up a hypothetical situation that would have taken place in the Savannah environment. He explained that we would have had to respond to any jumping shadow as if it were a real, physical threat — because it absolutely could have been. Or when we came across a source of sugar, we would have had to eat as much of it as possible in order to survive. And today, we are the descendants of those who ate all the sugar and jumped at all the shadows. Right now we still have those same impulses. The problem is that our environment has changed, and it does not benefit us to make decisions without careful thought and analysis.
Constructive Feedback: Gut Instinct is Fight or Flight
I wanted to learn more about our “fight or flight” instinct, so Gleb decided to illustrate a modern-day version of this instinctual response by talking about our response to constructive, critical feedback.
He explained that our gut response to constructive criticism from our boss could be to shut down and ignore it or to fight back. Our intuitive response is NOT to “listen to it and incorporate it into our performance, [but] that’s what we should do in order to succeed and survive.”
Cognitive Biases and How They Disrupt Sound Decision-Making
I wanted Gleb to provide some examples of cognitive bias so that you and I can get a handle on this concept. Basically, Gleb explained that cognitive biases are, for lack of a better phrase, thinking instincts that get in the way of sound decision-making. Here are a few for you to ponder:
- The Planning Fallacy: We incorrectly assume that things will go according to our plans. Even though it’s good to have a plan, assuming that there will be no obstacles is, according to Gleb, “a bad way to go forward.” Instead, it’s important to have resources in place that will help you deal with obstacles as they arise.
- The Optimism Bias: If we’re blind to risk, we would be experiencing what Gleb calls the “optimism bias.” Instead, Gleb suggests that “exaggerating expectations about other people, my projects, and so on” can cause a lot of problems when decision-making. Instead, surround yourself with a team that helps you name potential disasters and how you’ll avoid them. In other words, Gleb encourages us to “calibrate our optimism against the reality of the situation.”
- The Anchoring Bias: We tend to be “strongly anchored to what we hear first or learn about first.” In order to overcome this bias, we need to get outside of our comfort zone. We will never succeed if we are anchored to our comfort, so this means that recognition of this bias and willingness to step outside of it is critical.
Gleb Tsipursky’s 30 Cognitive Biases
If you’re interested in learning more about the other cognitive biases that Gleb discusses in his book, go ahead and pick it up at your local bookstore or online. You can even take an assessment located in Chapter Seven of this book to find out what cognitive biases are most prevalent in your own decision-making.
And, as always, you can connect with Gleb or me through LinkedIn. I’d love to hear from you, and I’d love it if you’d leave a review for our podcast!
Listen to the full interview with Gleb Tsipursky…