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Gut-Level Leadership:
Listen for the inner voice that guides decisions

By Mark W. Sheffert
October 2006

Instinct. Perception. Sixth sense. Gut feel. Call it what you want, just know that it’s a necessary characteristic of executive leadership.

In the past 30 years, I have observed many business leaders in action and have noticed that the most effective ones all share this characteristic: an inner voice that guides their decision making. These are the leaders who seem to just know—without pages of data to tell them—which market to enter or which businesses to exit. They connect the dots more quickly than others, reach conclusions with conviction, believe with a passion in their vision, and have a quiet courage and comfort with risk that allows them to act on their instinct.

Intuition Illuminated

In Good to Great, author Jim Collins describes a five level hierarchy of executive capabilities. He says at the top level, leaders “embody a paradoxical mix of personal humility and professional will,” modesty and an incurable need to produce sustainable results for their organizations and make their companies great.

One of these Level 5 leaders he describes is the late Darwin Smith. CEO of Kimberly-Clark from 1971 to 1991, he transformed it into the leading paper-based consumer-products company in the world. A shy farm boy from Indiana, according to Collins, Smith was not your stereotypical flashy, smooth-talking CEO. You won’t find his biography on the business bestseller lists, and if you Google his name, it won’t take long to read through what’s there. He was just an ordinary person, by most indications, but extraordinary for his instincts.

Shortly after becoming CEO, Smith concluded that the company’s core business (coated paper) was not going to produce the needed results. So, he told his executive team that they were going to sell their paper mills and invest the proceeds in consumer businesses, which included the Huggies and Kleenex brands.

At the time, the business media called him “stupid” and analysts on Wall Street downgraded Kimberly-Clark’s stock. But Smith didn’t flinch. He just knew in his gut that it was the right direction to go. Kimberly-Clark subsequently generated cumulative stock returns 4.1 times those of the general market, easily beating competitors Scott Paper and Procter & Gamble, and outperforming Wall Street darlings such as Coca-Cola, Hewlett-Packard, and General Electric, according to Collins’s research.

What is Intuition?

Intuition is hard to describe. It’s a little like when Supreme Court Justice Potter Stewart tried to describe hard-core pornography in 1964: “I shall not today attempt further to define the kinds of material I understand to be embraced . . . . But I know it when I see it . . . .”

Because I’m not the fastest car on the block when it comes to the behavioral sciences, I asked a couple of my firm’s associates about intuition in business. I started with Jacqueline Byrd, an organizational behaviorist and one of our senior consultants. She agreed that most successful executives have well-developed intuition.

“One of the things required is to be able to see beyond what others don’t see and pull the organization toward that vision,” Byrd said. “It means you don’t have to have all the facts and information, but you are able to create a vision anyway. It means being able to make decisions quickly, without a lot of analyzing, because leaders have to keep their organization’s momentum growing.” She’s found that these leaders are risk takers—not the type to take crazy risks, but typified by an ability to take the right, measured risks.

Many people are familiar with the personality-assessment test called the Myers-Briggs Type Indicator. Byrd said that most successful executives are “NTs” (N for intuition and T for thinking). According to the Myers & Briggs Foundation, N people are interested in what might be possible; they can think about the future more than the past. They work well with symbols and abstract theories, remember events by what they read “between the lines” about their meaning, and solve problems by leaping between different ideas and possibilities.

Combine these traits with those of the Ts, who like to analyze pros and cons and be consistent, logical, and impersonal in making decisions. They look for logical explanations or solutions to most everything and make decisions “with their head.” As a result, they can be perceived as being too task oriented or uncaring. Sounds a lot like successful executives such as Bill Gates and Steve Jobs, doesn’t it?

I also consulted with Michael W. Howe, another senior consultant with our firm who specializes in leadership and organizational effectiveness. Howe said intuition must be paired with courage: “Successful CEOs all seem to be able to see things quicker than others and add things up faster, but also have the courage and conviction in their vision that makes room for others to follow them.” They have a quiet strength in their own convictions and a willingness to take calculated risks that others in their organizations recognize, respect, and trust.

Boards of directors today tend to hire the “jazzy and glitzy” CEO candidates, the ones who seem to belong on magazine covers, rather than the candidates who are more insightful and intuitive, Howe added. And that can be a very costly mistake.

Regarding intuition and courage, I’m reminded of a story about Vince Lombardi, coach of the Green Bay Packers from 1959 to 1967. According to his son, Vince Lombardi, Jr., in his book What It Takes To Be #1: Vince Lombardi on Leadership, one of his father’s most famous coaching decisions came in the 1967 NFL championship game against the Dallas Cowboys. The heating technology under the field had failed, so the entire field was a sheet of ice. After a seesaw battle, the Packers were down, 17–14, with only 20 seconds left in regulation play and the ball on the Cowboys’ one-yard line. Most coaches would have gone for a field goal to tie the game. But Lombardi told his team to go for a touchdown with a quarterback sneak. The gutsy move paid off, and the Packers won, 20–17.

Asked about his decision after the game, Lombardi’s initial response was, “We went for a touchdown instead of a field goal because I didn’t want all those freezing people in the stands to have to sit through a sudden-death” overtime. But as reporters pressed for more insight, he said, “Those decisions don’t come from the mind. They come from the gut.”

Nature vs. Nurture

Can you learn that kind of intuition and courage? Are great CEOs simply born with those things? If not, how do they acquire them along the way?

I don’t know the answers and research doesn’t seem to give firm answers either. But I do know that if I were on a search committee, I’d select the candidate who already has intuition and courage but may come up short in industry experience or financial skills. Those things can be learned later. I’d bet my money on the candidate who was born with good intuition. Don’t ask me to explain why I say that—I just have a strong gut feeling about it.

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