Wise Decision Making inVUCA* Environments

(*volatile, uncertain, complex, ambiguous)

Rebecca Winter

Director of Talent Management, MSFT

Multiple Brain Integration (mBIT) Coach & Trainer

1) We Live in VUCA Times

2) Intuition matters in VUCA environments

3) There are optimal conditions for intuition

4) Possible to develop the ability

Key Frames

1. Volatile, Uncertain, Complex, Ambiguous (VUCA)

Working in a VUCA Decision Landscape

• Globalization and systemic impacts of decisions

• Complex adaptive multi-faceted organizations (Clients/Customers, Competitors, Stakeholders etc.)

• Higher expectations of all players, including Governance, Shareholders, Risk Management, Legal and Compliance, Employees etc.

• Social interconnectivity and speed of information spread (Social Media, Internet, Dataweb, iDevices, etc.) ;

• Technical complexity (large number and level of technical systems involved) and massive Digital Transformation in business; Acceleration of # of Data

• Massively accelerating changes in social/business/economic spaces due to acceleration of knowledge

VUCA Impacts Leaders’ Functioning

Volatility

Leads to Fear

Uncertainty

Causes Analysis Paralysis

Complexity

Default to B&W Thinking

Ambiguity

ImpedesChange

The Research Says:VUCA Scenarios Require Intuition

•Rational analysis is insufficient to deal effectively with complexity and ambiguity (VUCA)

•Experienced decision makers rely on intuition to supplement, and even to substitute for, rational analysis

• In VUCA contexts, intuition leads to more effective (faster, more accurate) decisions

• Intuition is a parallel process and does not have cognitive channel limits

•Best to combine intuition with rational processes in an iterative process

2. Understanding Intuition

Intuition

[in-too-ish-uh n, -tyoo-]

noun

ability to acquire knowledge

without inference or the use of

reason

Science Says You Have 3 Brains:

Cephalic Brain

~ 50 – 100 Billion neurons

Cardiac Brain

~ 30 – 120 Thousand neurons

Enteric Brain

~ 200 – 500 Million neurons

What is a Brain?

Structural:

• Large numbers of neurons and ganglia

• Neural cells with inter-neurons; neurons interconnecting in complex ways with other neurons

• Support cells and components such as glial cells, astrocytes, proteins, etc.

• A chemical warehouse of neurotransmitters (those found in the head brain are also found in the gut and heart brains)

Functional:

• It’s not directed by the Head Brain. Able to mediate complex reflexes via an intrinsic nervous system.

• It can learn. It has neural plasticity and adaptiveness as well as perceiving/assimilating information, processing information, memory storage and access.

Each Neural Network Has: Prime Functions

Cognitive Perception

Thinking

Making meaning

Emoting

Values

Relational affect

Core Identity

Self Preservation

Mobilisation

So What?

More Information Travels Up

Only 20% are EFFERENT – they

travel DOWN from your Head Brain

to the other Neural Networks

80% of the nerve signals are

AFFERENT – they travel UP

from your Cardiac and Enteric

Brains to your Head Brain

What science says about Intuition..

• “Gut reactions and intuition are neurologically based behaviors” [Dr. Tian Dayton]

• “In complex situations, intuitive decisions are more reliable than decisions taken using higher-level cognitive processes.” [Li Zhaoping]

• “ Deliberative decision making may actually increase unethical behaviours and reduce altruistic motives when it overshadows implicit, intuitive influences on moral judgments and decisions.” [Chen-Bo Zhong]

• “Fear and desire both interfere with intuitive perception. If you are anxious, angry or emotionally upset, you are not likely to be receptive to the subtle messages which can come into consciousness via intuition.” [Khatri & Ng]

• “In unstable business environments an intuitive decision-making style ispositively associated with company performance.” [Ritchie, Kolodinsky & Eastwood]

How Do the Heart and Gut Contribute?

• Physiological self-awareness is positively correlated

with intuition and strategic decision making ability

• Cognition is embodied – e.g. Hand on Heart Reduces

Propensity to Lie

• Drives Risk Aversion in Decision Making

• Increasing Signal to Noise Ratio: Decisions after a

meal are significantly different than those before a

meal

• Insight from your Gut requires dwell time

3. Optimal Conditions for Intuition

What is Required?

Autonomic Coherence

Use of all 3 neural networks

Coherence

Establishing Coherence

Your Diaphragm is a Bridge

Establishing Coherence

“Multiple Brain-Storming” for Decisions

Heart

In Relation to our Challenge:

What is it we truly want/value/relate to?

Use Compassion as the final lens

“Multiple Brain-Storming” for Decisions

Head:

In Relation to our challenge:

What is it that we think/perceive/understand?

Use Creativity as the final Lens

“Multiple Brain-Storming” for Decisions

Gut:

In Relation to our Challenge:

What is it we deeply need?

Use Courage as the final lens

4. Accuracy Develops with Practice & Trust

What You Can Do

1.Learn the Science

2.Get Coherent

3.Create the culture

4.Practice, practice, practice

5.Trust Yourself