Don’t Trust Your Gut! and Other Secrets of Good Judgment

Tom Davenport considered writing a book about bad corporate judgment – and then realized it would be too easy. Instead, his new book Judgment Calls: 12 Stories of Big Decisions and the Teams that Got Them Right focuses on companies that made the right move. Here are three tips you can you use today to sharpen your own judgment.

Get Over Yourself. The myth of the omnipotent leader is over, says Davenport, who is the President’s Distinguished Professor in Management and Information Technology at Babson College and a Visiting Professor at the Harvard Business School. An effective CEO doesn’t just sit in the corner office issuing decrees. “Even at GE in the Jack Welch days or Apple in the Steve Jobs days, it wasn’t just one Great Man. It’s so frustrating when people give a single individual credit for things that vast organizations do.” Part of the problem, he says, is sky-high executive salaries. “We pay these CEOs so much, and in the press we worship them to such a degree, that it probably makes them even less inclined to listen to these people who make 1/300th what they make…One of the things I admire about Google is they take the attitude that we’ve hired some pretty smart people, so we should probably ask for their opinions and give them free time to work on what they think is important.”

Don’t Trust Your Gut. The opportunity to gather and use data is better than ever before, says Davenport. The upshot? “It ought to be criminal to rely totally on your own judgment.” Yet too many executives insist on using their gut intuition to make major decisions. “If you have a huge amount of experience with a particular decision you’re making,” says Davenport, then it could turn out OK. “But in general, it’s a bad idea.” Almost every company fails to leverage the collective insights of their employees – so think through how you can gather feedback and act on it to improve your performance.

Don’t Pat Yourself on the Back. It’s human nature to focus on the positive, says Davenport. That makes it even more important to fight the impulse. “I think that patting yourself on the back is the absolute worst thing you can do,” he says. “We’re all flawed, we all make mistakes, so try to recognize them and learn from them.” You may even want to try an exercise he uses with his class, where he invites students to write about a personal decision they’ve made and the thinking behind it. “In the beginning of the course, 99% of the essays are about ‘great decisions I made’ or ‘decisions that turned out really well.’” It’s often a shock for them to realize, after some gentle questioning, that their keen judgment may simply have been luck. Says Davenport, “Even in my own life, after teaching this course, I’m much more aware of personal decisions I’ve made where the process was really bad.” From impulse purchases to snap judgments about a situation, it often pays to slow down and listen to the data.

What’s the best – or worst – business decision you’ve ever made? Why?

This post originally appeared on the Forbes website on May 23, 2012.

Dorie Clark is CEO of Clark Strategic Communications and the author of Reinventing You: Define Your Brand, Imagine Your Future (Harvard Business Review Press, 2013). She is a strategy consultant who has worked with clients including Google, Yale University, and the Ford Foundation. Listen to her podcasts or follow her on Twitter.