Data-driven decision-making or gut-level decision-making, which is the answer? The pendulum has swung way over to data-driven. But isn’t your personal experience and judgment what got you to where you are?

Your value as a leader comes from your experiences and judgments. If organizations could codify every decision into a predictable formula, leaders would be replaced with statistics packages.

Yet, your personal experiences and judgments, while successful in the past, may no longer be sufficient in a changing world. So, what can you do? The answer is that you need both: good data and a strong gut. However, we need to change the way use them:

Instead of using your bias to answer questions, use it to generate questions and let the data provide the answers.

Then, instead of using data to support your gut, use your gut to process the data.

Ultimately, all of our decisions are gut-based and biased. This is best illustrated in Jonah Lehrer’s book, How We Decide. Lehrer describes a man who after having a tumor removed from his orbitofrontal cortex couldn’t make decisions (at least not quickly and easily). In the opertaion, some of the orbitofrontal cortext was also removed. The orbitofrontal cortex is the part of the brain governing emotion.

Why is it so hard to make an entirely fact-based decision? First, there is always more data. At some point, you have to make a judgment call. You must believe that you have a reasonable amount of data and a sound argument. Otherwise you’ll be searching endlessly. Second, treating every fact equally thwarts decision-making. You must determine which data matters most. This comes from your experience. Finally, few problems have a single right answer. Two people looking at the same dataset can come to vastly different conclusions based on their experience with similar data. And, both might be right. A surge strategy and a withdrawal strategy are probably equally viable ways of resolving the conflict in Afghanistan. It’s not that one is right and one is wrong. Both have their merits and their issues. To determine which is the “right” answer, people must use their experiences, biases, and gut to put the data into a broader context.

In today’s world, the “right” answer isn’t some form of absolute truth. Rather it is the one based on a sound, logical argument that is supported by facts (with the realization that there might be an opposing view that also has a sound, logical argument supported by facts).

This isn’t to say that every decision and every opinion is equally viable. People make bad and misinformed decisions. Good leaders need to learn how to harness their gut and bias. However, they should not blindly follow them. I am not advocating that we swing the pendulum back the other way. My point is just that we can use data to confirm or refute our biases/gut and we can use our gut/bias to put the data into a broader context.