How to exercise your judgement during a pandemic
Business leaders worldwide are faced with an overwhelming array of difficult decisions. This framework will help navigate the crisis
- Judgment can be defined as the ability to combine personal qualities with relevant knowledge and experience to form opinions and take decisions
- Judgement is not a synonym for being cautious. It implies action and taking decisions.
- You will never have all the information before acting. The judgment call involves recognising when you have to act but also recognising the limits of your knowledge.
In the much-loved British TV talent show Opportunity Knocks, the moment the viewing audience had to pick that episode’s winner was called “make your mind up time”.
Many politicians and business leaders will be experiencing a similar “make your mind up time” sensation at the moment. The pressure is on to take decisions. Good decisions. And taking difficult decisions fast is never easy at the best of times. This is where good judgement comes in. But what exactly is judgement?
Sir Andrew Likierman, Professor of Management Practice and and former dean of London Business School, has been conducting extensive research into leaders and how they form judgements.
In the second webinar of the series Leading through a pandemic, Sir Andrew, in conversation with Julian Birkinshaw, Professor of Strategy and Entrepreneurship at London Business School, discussed how leaders can form good judgements at this extraordinary moment and beyond.
The COVID-19 pandemic represents a wholly unexpected if not necessarily unimaginable event, suggests Professor Birkinshaw. Whether it counts as a “known unknown” or an “unknown unknown”, in Donald Rumsfeld’s famous taxonomy, is open for debate.
Either way, good management and leadership are required to deal with the situation. Judgement comes into play even though we are being asked to form views on things we don’t have complete data on. A live poll of the webinar audience of more than 2000 revealed that their main concern was uncertainty about how long the current crisis will last. But other uncertainties are present, both for businesses and families.
What does good judgement look like in this context? There is no one-size-fits-all blueprint. The context and cultural background will vary. The type of organisation involved will vary. What Sir Andrew elucidates here is how best to make any judgement, not tips on what to do now.
He defines judgement as “the ability to combine personal qualities with relevant knowledge and experience to form opinions and take decisions”. Judgement is a collection of qualities, not a single one. And it does not mean being cautious:
“It means taking decisions in the right way at the right time – not taking no decision. So this is not about caution. Delay too long and it is too late. Not doing something is effectively doing something. And it’s not about being judgemental! That’s the opposite of judgement.”
Maybe you should scrap the 2020 budget? Perhaps it describes a world that no longer exists
Professor Birkinshaw also warns of the danger of “analysis paralysis”. We might not know what to do, but we can also wait too long for more information which may never come.
In measuring good judgement, we have to acknowledge that we can’t rely on using outcomes. That’s because luck may well be behind success, according to Sir Andrew. . What’s more we will never know what would have happened if different choices had been made. What Sir Andrew’s analysis provides is helping to “stack the cards in your favour”.
The six dimensions of judgement
Consider these six aspects of judgement, he suggests:
1. Listening and reading. Have I understood?
We vary in our ability to take in what we hear and what we read. So we need to actively ask ourselves, “Have I understood what I’ve heard and read?”
2. Can I trust the information and the person giving it?
The New Zealand prime minister, Jacinda Ardern, is a rare example of a leader who speaks plainly and convincingly in a crisis, as we saw after the shootings in Christchurch last year.
3. Do I have the relevant information and experience?
What do we know for sure about coronavirus? Not much yet. In a month we will know more, and in three months even more. Meanwhile we need to acknowledge the limitations of what we have.
4. How do my feeling and beliefs (including about risk) affect my choice?
What one judges is filtered through one’s beliefs and feelings, Sir Andrew warns. Acknowledging this is a good step towards making decisions that are less biased.
5. Are these the right options for my choice?
Have I thought enough about who else to involve in decision-making during the crisis? Have I looked enough at how others are doing things? Have I thought radically enough about how to get through the crisis, for example through zero-based budgets?
6. Delivery
Can this be done? Implementing a decision in these conditions will not be straightforward. For example, key people might be unavailable through family circumstances, or indeed illness.
Beware of biases
A big part of forming a good judgement is recognising that we are all subject to biases, Sir Andrew says. To take some that might be around in these conditions, we might be systematically optimistic or pessimistic. We might have a bias for seeing analogies that do or don’t apply to this current situation.
We can fall prey to confirmation bias (when we think evidence supports our point of view) or availability bias (when the latest piece of evidence is given too much weight).
We may tend to set too much store by small numbers, when a sample of evidence is not big enough to be meaningful. And groups may well be prey to groupthink when it is tempting to agree with the majority rather than risk disapproval or exclusion.
Three questions to ask yourself
Sir Andrew suggests we ask ourselves these three specific questions, as we all wrestle with this issue of forming sound judgements:
1. What do I know?
“Push yourself along the timeline of information”, he says. Get as much if the relevant facts and data that you can – there may be more than you realise. For example the World Health Organization website has advice on what works and what doesn’t, in the controversy about the use of face masks.
Above all, acknowledge that you are not the only person facing the problem you face now, Sir Andrew observes. Find others in a similar situation and read about or discuss it with them. You might need to think differently and employ “creative benchmarking” – imaginative ways of finding appropriate parallels.
2. How do I plan?
This is a moment to revisit your appetite for risk, Sir Andrew says. And he has some radical thoughts. Maybe you should scrap the 2020 budget? Perhaps it describes a world that no longer exists. Others – suppliers, customers, competitors – will be affected by current events even if you are not. You may need new objectives, with graded timescales. There is too much uncertainty to be prescriptive. Make rolling forecasts rather than fixed ones. Be realistic about how far you can plan ahead. And be explicit about the inevitable trade-offs you face.
Ask yourself: "Would I be prepared to defend what I am doing now when this is all over"
Zero-based budgeting and other drastic moves may appear to be disruptive but they might be worth it, Sir Andrew says. In the wake of coronavirus things are going to change pretty fundamentally for some organisations.
As far as planning ahead is concerned you will need a range of forecasts to help guide you through the coming months. What assumptions are you making? Try to look for evidence that may be missing. Now is probably too early to make detailed plans for the post-coronavirus world.
As far as your numerical models are concerned, artificial intelligence and algorithmic assumptions could now be unsound, Sir Andrew says. Your models may no longer apply. Check out the assumptions they are based on to see if they are still relevant.
A great question to ask yourself at this time before making a judgement is: would I be prepared to defend what I am doing now when all this is over?
3. Should I rely on my gut?
This is a very common question at a time like this, Sir Andrew says. Distinguished authors have come up with a range of responses to it, for example with Malcolm Gladwell (in Blink) suggesting that you can trust it, and Daniel Kahneman (in Thinking, Fast and Slow) arguing against.
Sir Andrew suggests a checklist for deciding whether to rely on gut instinct for a difficult decision: Do you tend to act and then regret it? Do you have the data you need? Are the stakes high? Do you have the necessary experience? Since right now most leaders don’t have the data they need or enough experience of pandemics, this is probably not a great time to trust your gut.
For any judgements (not just now) Sir Andrew suggests six points to keep in mind:
- Be aware of your filtering in listening and reading.
- Be careful in who and what you trust.
- Be aware of how far you have relevant experience and knowledge.
- Understand your feelings and beliefs.
- Make sure you have the right options.
- Check on the practicality of delivery.
Good leaders in these circumstances, Sir Andrew says, have the ability to communicate that they understand the situation but acknowledge the uncertainties. It’s a delicate balance, he adds.
Professor Birkinshaw agrees: “Leaders shows their true soul at the time of a crisis. Who comes across as authentic and who is false or forced?”
You must be the judge of that.
