We’re bombarded with “data this” and “data that” these days. The popular press—and perhaps our own organizations—tout the seeming omniscience of big data, artificial intelligence and machine learning. Datasets are abundant. But can the past (data) accurately predict the future in a rapidly changing world where the rules are rewritten constantly?
Author David Morelli
Don’t get me wrong, I love data! I’ve joked with my wife that I “binge-iterate” on multiple-linear regression with data (sorry if I lost you there) like other people binge-watch shows on Netflix. Data is great for gaining insights through various forms of analyses and visualization techniques. If someone came to you in a crisis, however, and needed an answer in 30 seconds, would you use that 30 seconds to start a long analysis process or would you use another strategy?
Most of us would make a quick decision—one primarily based on intuition, whether or not we call it that. Intuition often gets a bad rap, but academic researchers are increasingly studying it as a legitimate form of decision-making. Here’s a quick summary of some recent findings:
- Intuition is an emotionally-charged judgment (think “gut-feeling”).
- Intuition occurs via rapid, unconscious, holistic associations (think “ah-ha moments”).
- Intuition is most effective for unstructured, less defined problems (think “Hmm, where do I start?”).
- Intuition is linked to activation in the basal ganglia (think cognition + emotion).
Researchers (Dane & Pratt, 2007) describe the brain as having dual processing functions: the conscious and unconscious levels. Some research estimates the unconscious processing power of the brain to be one million times the power of the conscious mind. This means that whether or not you know it, you have a lot of horsepower to be harnessed, if you want it. In fact, intuition is amplified if you already have expertise in a certain area or a base of knowledge.
Take this study (Dane, Rockmann, & Pratt, 2012), for instance: In a laboratory setting, participants were asked to determine whether a set of 10 designer handbags was fake or authentic. The participants, all of whom had varying levels of exposure to and familiarity with designer bags, were randomly assigned to use either analytical decision processes (identifying the top 10 criteria for judging the bags, such as stitching, material, etc.) or a more intuitive process. As one might expect, the participants who were more familiar with the bags were able to spot the authentic ones more easily. However, the surprising finding was that the intuitive decision-makers were significantly more accurate than the analytical decision-makers even with the same level of expertise. What this reveals is that our intuitive or unconscious processing ability will spot trends and identify information that our rational minds simply can’t grasp, thus increasing accuracy.
So what does this mean for you in business and in life? It means that if you face uncertain situations with tight deadlines, you’re better off allowing your analytical mind to soften for a minute and allow the 1,000,000x processing power of your unconscious mind to serve up an answer.
For more information about Executive Education at the Daniels College of Business, please visit daniels.du.edu/executive-education.