The positive influence of intuition on decision-making
Katharina Fellnhofer researches how intuitive decision-making influences personal success. She is convinced that people who follow their intuition tend to be more successful in their decision-making.
Despite the growing number of female-led firms in Europe1, access to business financing tends to be one of the biggest obstacles facing female entrepreneurs. Financing innovative ideas is certainly challenging for male entrepreneurs and financiers, but is generally even harder for women.2 The reasons for this are very complex, but I am mostly interested in the role played by intuition in this context.
Why is intuition so important?
There are several reasons why entrepreneurship can seem like a rollercoaster ride. Success depends on many decisions that often have to be taken under time pressure, with a high level of uncertainty, dynamism and complexity. Situations never follow rigid principles and are not linear. Our rational thinking tends to reach its limits in such scenarios. Given the “nature of entrepreneurship”, I am convinced that intuition is a decisive factor in entrepreneurial success and is equally critical for investment decisions.
“Being intuitive does not necessarily mean being able to apply intuition successfully.”Katharina Fellnhofer
Science largely agrees on the definition of intuition. Intuition is driven by emotive impulses that arise from rapid, unconscious and holistic associations.3 Intuition helps us to think holistically, by linking an unconscious “instinct” with information. Intuition is difficult to measure, however. As far as methodology is concerned, research to date has relied on survey-based techniques and interviews, or unrealistic experiments in the laboratory. Of course, someone can report their experiences retrospectively, but this only captures the perception of intuition – not the actual ability and skill needed to use unconscious emotional information to make conscious decisions. In other words, being intuitive does not necessarily mean being able to apply intuition successfully.
Intuition as a key to greater success?
Obviously, the influence of intuition on decisions is not only important for entrepreneurs and investors, but for all of us. Every day we make “entrepreneurial” decisions, such as the activities in which we choose to invest our limited resources of time and money. So it’s good to know how to use intuition successfully in making your own daily decisions. The trick is to draw on an optimal combination of rational and intuitive knowledge – depending on the specific situation – when taking decisions.
In my research I am particularly interested in the question of how intuition influences our individual success. This has not yet been fully explained to date, let alone objectively measured. In terms of methodology, our research work is based on a new approach taken from psychology that is designed to measure intuition.4 Here we aim to assess the effects of decisions made, as part of a web-based experiment that compares differences between treatment and control groups.
In my scientific work I analyse how intuition influences rapid decision-making on the one hand, and on the other hand how corporate profit and growth rates are affected by intuitive decisions.
I also want to investigate whether there are any differences between the sexes in this context, and what form they take. I do not share the popular belief that women tend to be more intuitive than men, an assumption for which there is no scientific evidence – at least as far as I know. People see themselves differently when it comes to intuition. Describing yourself as intuitive does not automatically mean you really act in an intuitive manner. If my hypothesis is correct, there is no difference between men and women in their intuitive capacity, but rather in how they use this intuition when making decisions.
The long-term goal of my research is to determine how our intuition can provide positive support for decision-making in uncertain and complex situations – something that ultimately benefits everyone, men and women.
Fellnhofer works in the Chair of Entrepreneurial Risks at D-MTEC, ETH Zurich, and was recently awarded a prestigious Marie Curie Fellowship.
References
1Elam, A. B., Brush, C. G., Greene, P. G., Baumer, B., Dean, M., Heavlow, R. 2019. external page Global Entrepreneurship Monitor - Report on women’s entrepreneurship. Global Entrepreneurship Research Association, London Business School, UK.
2Eddleston, K. A., Ladge, J. J., Mitteness, C., & Balachandra, L. 2016. Do you see what I see? Signaling effects of gender and firm characteristics on financing entrepreneurial ventures. Entrepreneurship Theory and Practice, 40(3), 489–514.
3Hodgkinson, G. P., & Sadler-Smith, E. 2018. The dynamics of intuition and analysis in managerial and organizational decision making. Academy of Management Perspectives, 32(4), 473–492.
4Lufityanto, G., Donkin, C., Pearson, J. 2016. Measuring Intuition: Nonconscious Emotional Information Boosts Decision Accuracy and Confidence, Psychological Science 27(5), 622–634.
Further information
Project website external page Roller-Coaster