Artificial intelligence—AI—is a game changer that we are just beginning to understand. The development of large language models means we can access vast amounts of data in an instant, and the benefits and risks of this are unfolding.
One of the biggest risks is thinking this is a panacea for corporate decision-making. All data comes from the past, so is of limited use for leaders seeking creative or innovative solutions: it is here where leadership intelligence remains distinct from artificial intelligence.
What makes leadership intelligence distinct? Imagination and emotion cannot yet be replicated using AI, and the human brain can make decisions based on more than mere data. There are three aspects I consider essential in leadership intelligence that make decision-making uniquely human: judgement, intuition and urgency.
Judgement is the ability to choose from a selection of alternatives and make the right call. Good judgement is what separates great leaders from the merely good ones.
People will follow and trust a great leader because their judgement is respected. Good judgement is about making the right choices and this requires wisdom and foresight.
Knowledge alone is not enough. As the old saying goes: knowledge is knowing that the tomato is a fruit, but wisdom is recognising it doesn’t belong in a fruit salad.
Judgment is a learned skill and creates the difference between a welcome or unwelcome outcome. There are known enemies of judgement, such as ignorance or what we don’t know, and bias, which is what we think we know but is simply prejudice or opinion. Good judgement is achieved through combatting these enemies and through constant vigilance. It is not easy making the right choices all the time, but judgement can and should be taught as a key management skill.
Knowing without thinking
Intuition is our sixth sense. It is what some people call gut-feel, and it comes from instinctive rather than rational thought. It is technically a bias but a useful learned heuristic designed for self- preservation by our ancestors faced with the choice of fight or flight. In business, it is a reactionary response to a challenge that draws on experience and expertise. It is often called ‘knowing without thinking’. Intuition can be emotional rather than rational, but intuitive decisions often result in good outcomes because they draw on knowledge from a deep level we didn’t know existed.
Much has been written on the significance of intuition in decision-making, as both an aid and risk in human judgement. Intuitive decisions can save time where time matters but they can also breed false confidence and a sense of infallibility in hubristic leaders. Boards and senior teams need to be aware of how they use intuition in collective decision-making. Intuition can be a personal matter of perception not shared by the whole team, because experience and expertise vary.
Urgency matters because, for any decision, the biggest question is: do you need to make it now, today? Nobody would choose to make a rushed decision unless they had to, so we convince ourselves that urgency is due to ‘force majeure’ or factors beyond our control. However, much of this perceived urgency is misdiagnosed due to cultural constraints: a need to meet internal goals such as timetables for sales targets, shareholder dividends, investor relations or the business agenda.
Executives who claim not to have enough time are often making excuses for their poor time management, allocating insufficient time for a decision. The time available to reach a decision is only brief if we make it so. There is much to be gained in deferral, discussion and deliberation. The classic phrase ‘festina lente’ comes to mind—more haste, less speed. Conversely, first responders in the emergency services are training to act quickly to save lives: they have to make urgent decisions and are trained in making good decisions under time pressure.
Leadership intelligence cannot be replicated by AI and it is important for boards to appreciate where their collective experience and understanding makes a difference in decisions about a future outcome. Judgement, intuition and urgency all play a part. Although some transactional decisions are irreversible, many policy decisions are revisable and could be adjusted. We need to create capacity to reflect or amend decisions as events unfold.
Garry Honey is a member of the visiting faculty at Henley Business School, and author of Navigating Uncertainty: securing better judgement.