Feeding Our Gut Feeling with Data and Statistics

Following our instincts before making big decisions is usually the best option. When, for some reason that we can't explain, our decision goes against logic; that is the voice of our instincts talking, and we should listen to it. However, our gut feeling might be tainted; we could be influenced, on an unconscious level, by a specific outcome and make biased decisions. 

On the other hand, numbers reflect reality, data is objective. Or is it? Can't we look at the statistics that support our thought, and even with strict data in front of us, make a subjective choice? 

In this episode, we talk about data vs. going with our gut in big decisions. We delve into how hard it is to find the balance between what we see through numbers is the right choice and what our feelings tell us we should do. We discuss when we should, as leaders, go with our instincts or look at the data and trust the numbers. We talk about the importance of surrounding ourselves with people who can turn data into information, and information into insights. We also talk about stepping back, getting away from the noise, and looking at the big picture in silence to get closer to the correct answers. 

In This Episode, You Will Learn:

• My tummy feels like watching a movie. The importance of getting used to listening to our instincts (3:12)
• The numbers don't lie, or do they? We must pay attention to data skewing (5:28)
• Data can't be blindly followed (8:33)
• About turning data into information, and information into insights (10:28)
• How can we get outside of the groupthink (15:33)

Resources:

• Quote - William Edwards Deming - "In God we trust, all others must bring data." 
• Quote: Attributed to Albert Einstein - "Not everything that counts can be counted, and not everything that can be counted counts." 
• Quote: Carly Fiorina, Former CEO of HP - "The goal is to turn data into information and information into insight." 
• Coaching with Clint Consultation Call - Book Here
• Download my free One-on-One Transformation tool

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Transcript

Clint Hoopes: Welcome to the Flavor of Leadership podcast. So excited to have you here today. We are going to be talking about “data versus going with your gut” today. So, every day, as leaders, we are making decisions constantly. Some decisions are super simple, and so you just make the decision and go – no need to do exhaustive research or finding and gathering all the data. Typically, for these small decisions, you have all the data you need right in front of you. Sometimes the very questions being asked, the way it's being presented, is enough information to just make the call and move on. But today, we're talking a little bit more about the bigger decisions, the bigger decisions that may come to you each day; or they may be your bigger strategic decisions, decisions that impact the overall direction of the company or it might just be a piece, small piece of the company, knowing what to do and when. Often, this is very simple, and you know when you need more data or not. But I'll tell you, sometimes when leaders are faced with big decisions, you will just rely on your gut and say, “You know what? Just go with it, it just feels right.” So, the question today is: Is that right? Should we just go with our gut because it feels right? Or should we get more data in some of these cases? I love a quote that I want to share with you today by William Edwards Deming. So, Deming, you probably heard of him, he's quite famous for a lot of different things. He's had his hand in a lot of different things. He's a famous engineer, statistician, management consultant, and many other things. And he said this: “In God we trust. All others must bring data.” I love that. I will have faith in God and I will trust in Him, and I don't need to see everything there, and I'll trust in God; but everyone else, when there is something huge that has to be done, bring data, bring data to support your actions and what you're doing. So, that's what Deming says, versus many others that will say, “Go with your gut instinct. go with your gut.” So, when do we do what? 

So, my wife, she's amazing – I've said that many times on the show because it's true. She is so good with our kids and helping to teach them to think properly about things. And one way that she teaches our kids to think well, so they can grow up and know how to think for themselves is in regards to food. And so, often, in our family, you may hear my wife say something like this: “What does your tummy say? Or what does your belly say? What does your body say?” As far as whether you need to eat more food, whether you're already full, just how you're feeling in general, and it's just learning to listen to your body. And so I love that, and it's fun. And sometimes the kids are like, “I'm not hungry at all.” But then you pull out the ice cream and they're all suddenly starving. And we all do that, and it's kind of fun. But teaching our kids to do this. So, my three-year-old boy, he has taken this to heart. He will always be saying, lately, he's been saying things about his tummy – so he'll be like, “Oh, my tummy wants more food.” We’re like, “Oh, great. We'll get you some more food.” But then he'll say, “My tummy wants ice cream.” We’re like, “Okay, we’re getting in trouble here.” And then now he's also been saying recently, it's pretty funny, he’ll be like, “My tummy really wants to watch a movie,” or “really wants to watch TV,” or “My tummy really wants to go outside.” And so he uses that as “Look, this is what I want. This is what my gut is saying. This is what I think.” And so it's fun. I really do like it. But are we like the three-year-old in making the decisions in our business? Are we saying, “Yeah, my tummy says, ‘Go for it,’ or ‘Don't do it!’” When really, we could be getting data to make a decision. 

So, there are times to go with your gut and times to listen to your gut, trust your gut instinct, all of those things, but there's also time for data. So, Albert Einstein, he said this – or at least this quote is attributed to him. It's tough with quotes like this, sometimes they get shared by different people. But we're going to call it Albert Einstein, says this: “Not everything that counts can be counted, and not everything that can be counted, counts.” It's kind of confusing, so let's break it down. He says, “Not everything that counts can be counted.” So, not everything that is important can actually be counted very well. Sometimes it's hard to measure customer satisfaction. And we know that it's possible, you can do surveys, etc, but you can't get everyone to answer the survey, and you can't get them to answer it honestly often. So, it is important to have customer satisfaction, but can you really count it well? Who knows? We try. So, “not everything that counts can be counted.” And then the last part, “not everything that can be counted, counts.” Now, that's probably the most important part is “not everything that can be counted, counts.” So, just because we can count it, doesn't mean that we should. It doesn't mean that we should even take the time to count it, in some cases. And then other cases, maybe we take the time to count it because it is so easy to gather. In our world of technology and data, data is so easy to gather. We can gather on the front end, we can put it into databases, we can use it 1000 different ways. But sometimes we get data overwhelmed, and sometimes we will take that data, and we will use it and skew it to fit whatever we're trying to prove. So, sometimes we'll have biases in the data and the way that we do it, so we have to be careful with that because it can cause us to make decisions that aren't best for us either. Or we can skew the data, like we were saying, to make it tell a story that may not necessarily be true. 

So, in this case, where he says “not everything that can be counted, counts,” I think it falls under that umbrella. Just because we can count something doesn't mean it's necessarily important. I remember in school people saying, “Correlation does not always equal causation,” or “does not always mean causation.” That's always stuck with me over the years, because often we'll be having discussions and making decisions in business, or heck, even at home or whatever, and we’ll say, “Oh, well, this happened and this happened at the same time, man, they are definitely correlated. This caused this.” It’s like, “Well, yeah, sample size of one, not enough.” That does not mean that this actually happened. Does it mean that it might have? Yeah, maybe. But let's find out. We can't just take that one instance or a couple of instances and assume that this is now true. So, “Correlation does not always equal causation.” So, we have to figure out what to do with our data. We need the data to make better decisions. We can't just rely on the data. Often, we try to do this, and there are applications for this; decision trees, we'll see those, we'll use those in business. We want to dummy things down to the point that we can't make a mistake. And so if we're talking about, yes, a customer service attendant at the front, and they need to be able to go, “If the customer asks this, then you say one of these two things. And if this happens, then you do one of these three things.” And you're going down the decision tree and it tells them exactly what to say. Now, hey, I have no problem with that, that can be very helpful in certain instances. But as a business leader, there's not typically a decision tree that can be used to be able to help you make the strategic and impactful decisions that come to your doorstep every single day. 

So, there's a quote that I love here by Carly Fiorina. So, she is the former CEO of HP, Hewlett Packard, and she said this: “The goal is to turn data into information, and information into insight.” So, I love that because we're talking about data and how it's just out there. And we have to be able to put some form to the data so that we can actually know what we're looking at because data can mislead us, like we said, but it can also be an amazing thing that can help give us insight, but it has to be turned into information first, some conclusions must be drawn, and then we can use the information to make actual insights – make sure we're measuring the right things, make sure we're drawing the right conclusions. In previous episodes, we've talked about not being the smartest person in the room, and this is one of those cases where you don't want to be the smartest person in the room; you want to surround yourself with a team that is smarter than you, that knows more about the specific things that you're covering because they can take this data for you and distill it down. And you can have multiple different people that have insights that they can draw. So, that way they can help turn it into information for you, their insights become information for you. And then all of the information gathered together from your smart team – the people that are smarter than you with all of their individual pieces – you, as the leader, are able to take that data, take that information, and turn it into your specific insight, so that your decision that needs to be made because you are the leader, you make the ultimate decision, you are the one that gets to take all of the information, all of the data, take your insights, and make the decision. 

So, we talked in the beginning, what's more important: data versus gut? And the clear answer is, you’ve got to have both. Whenever we start skewing one direction or the other, with big decisions, that can be a problem. We start skewing to the point where we're constantly making all of our decisions with just data and not using any of the intuition and other information and insight that is tough to distill into data. There are so many different inputs that are coming into us as leaders, and our minds are constantly evaluating, determining, and measuring in its own unique way. Our minds are incredible things. So, we don't want to get so distracted by the data that we can't actually use our gut, our insight, which is really our mind solving the problems for us. Right, that's what makes you, as a leader, unique and special. It's your unique experiences, over the years, that make you the one that can make order out of the chaos, so to speak; taking all the data and putting it together into a great decision. Are we always right? No, we're not always right. But we are right more of the time, I believe, when we use the data and our gut. When your gut is saying, “No, don't do it.” Stay away. But if you get new data that helps you be able to feel better about it or change your decisions, it's okay to change the decision when you get new data. We can have strong opinions, but we can change those opinions as new data and better data is introduced, or more context to the data. 

Context is often some of the most important things as well. I've had business decisions brought to me before where people have said, “Hey, we need you to make a decision on something,” and they'll bring me the data, and I'll start asking some questions, and I will find out that, in fact, this data that we thought was so good was biased and skewed for very particular reasons for the decision that we're making. And so often, it looks like the decision is so clear, but as soon as some more questions, we actually realized, “Maybe not.” 

So, the other thing to remember is that depending on the type of decision, often the data has a tendency to be skewed. So, if someone's trying to sell you something, for instance, they are going to bring the best possible numbers. In my past, we have dealt with different acquisitions over the years. So, we'd have businesses that we were looking at, trying to decide, first off, is it a great fit for our organization to include them with us? And then also, looking at the data of the organization, “Well, how are they operating on their own? And can we actually enhance it or not? Where are the opportunities?” Those are all the things you go through in an acquisition. And so we've had times where you're looking at the data, and you’re thinking, “This looks amazing.” So, for all of you out there that have ever been involved in an acquisition or a company-selling of any kind, it always shows the best data, it's always the best data presented. Even if it's bad data, it's presented in such a way that wow, the performance was poor, guess what? It looks good when they present it to you. And even if they lost money, “But what about all these things?” And it may be true. But you, as the leader, have to be able to distill all of the information and figure out what is real, figure out how to ask the right questions all along the way. As we go through this, this is, once again, the reason you’ve got to have your strong team around you to help you. But your team can also fall into groupthink, and you as the leader have to be the one to step outside of that and not get pulled into that groupthink that can overtake us all. 

So, one of the best ways to get outside of the groupthink, and to get outside of your normal flow of what's happening when you're making a decision. Sometimes it gets to the point where you've got all the information in front of you and it just feels like it's so much, and maybe the data is pointing very clearly in one direction but you're still not quite sure – that's a very clear sign that you need to take a step back. Especially, when we're talking about strategic decisions, or big purchases, or big direction changes, all of those kinds of things – you’ve got to take a step back. So, how does that look? That looks different for everybody. But I'll tell you, this is the place where it needs to look the same. 

Quiet – it needs to be quiet, no distractions. So, maybe for you, no distractions and quiet, that's great. Maybe you can do that in your office. You're in an organization where you can shut your door and no one's going to bother you. You can turn your phone off and it's not going to ring, and you're going to be okay. In other organizations, it’s not possible – health care in my past, goodness gracious. If you are there at your operation, your door is going to open – people need you, and that happens constantly. It's just the flow of that particular industry. So, in order to get away there, you had to step away and actually leave. And so I find that, for me, some of the best ways that I've been able to get my best insights and get my quiet is to actually go and take a walk, or to go and hop on a mountain bike. I love mountain bike, I've talked about that before, where one of the best ways that I find that I can think the most clearly is when I go to one of our local trails, and I can just, by myself, hop on my bike, I can go for an hour and just think. I love listening to headphones, I love listening to books and podcasts and all these different things. But when I'm trying to work through a decision and gain some insight, or to gather my thoughts around a strategic decision; I'll leave the headphones in my pocket and I will go, turn off the phone and I will go. And I'll find myself being able to think. A little bit of exertion as well seems to just bring out the best of my mind. And often, as I get up to the top somewhere, just sit on a rock, and I'll just sit there and I will think, I'll just try to think through things. And often what happens is, I will have insights and thoughts that I didn't even see before. And often they will seem so obvious when I take the time to step away, get outside, take a walk, hop on a bike, and it allows my mind to think, it allows me to process as I get away and get quiet without all the distractions. 

We have so many less opportunities to not have those distractions in our lives with phone and constant connectivity. And so all of us have to find the way that works for us to be able to strategically disconnect, I say, daily, like this. Not just when you have huge decisions to be made, but even on just your normal days; taking time to step away and be disconnected will allow you to think more clearly. You'll be able to envision the future of the organization, you'll be able to take some of the decisions that have been plaguing you, and all of a sudden, they seem a little bit better. In much the same way that happens after you sleep. I find that when I sleep, I wake up in the morning, and things just feel a little bit better. You're not as tired, and so your mind has had a chance to work through things. And so some decisions just work themselves out, or they're presented with new opportunities, new questions that allow you to make better decisions.  So, when you find yourself in a situation like this, step away. If you can't make that time every single day – which you really should – take the time when these on these big decisions to step away, get quiet. 

So, that is your challenge for this week. You have a big decision, it doesn’t have to be huge or monumental, just take one of the bigger decisions that you're dealing with right now. Try this. Commit to it right now. Take one of these decisions that are sitting there in front of you, or maybe decision you've been holding off on making, and you're just like, “Ah, I just don't know.” Even if you don't feel like you have everything you need to make the final decision, take this advice, go for a walk, get out in nature if you can, go on a bike ride if you have one, and take the time to be alone and be quiet. And just listen, write down your thoughts, write down the things that come to you, write down the questions as you go thinking about this problem or this decision that needs to be made. And see what happens. What do you have to lose? But I can guarantee you, if you truly do that and disconnect, you will come away with insights. And I think you know this inherently. I think we've all seen this. Even if you don't do this constantly, I think you know. This is why people have brilliant ideas and they solve problems when they're in the shower, or when they wake up – like we said, you'll wake up and you'll have solved a major problem. Or the weekend comes, you're going on Friday, it's a huge problem, you don't know what to do; weekend comes, you take off a Saturday and a Sunday, and you go do something different, you come back on Monday, and for some reason, the problem doesn't seem as big or the answer is more clear – all of those different things. So, try speeding up that process by taking some time on this decision that you have or right now, or this opportunity, or whatever it might be. Take the time to step away. 

You can do it, I know it. It's going to be awesome. It's going to be great. I'd love to hear about it. Please feel free to respond to one of my posts on social media or send it directly to me at [email protected], I would love to hear about things. Or you can go ahead and leave those as a review on iTunes is another fantastic place, we appreciate that. I do read those whenever they come up. I love seeing the new reviews. So, if this podcast has been helpful to you, please also consider leaving a review. You take the time right now, and it would be so helpful for other people to find the show. Thank you for being here today. And I cannot wait to be back with you next week.