Decision-making is broken. Have you noticed that while there have been more and more calls for rigor, disciplined models, and big data in recent years, the outcomes of decisions actually got much worse? Experts have spent decades condemning “intuition” and “gut feel.” But the achievements of technocratic decision-making have often been horrific.
Elites and experts are humiliated. Rigorous Planning has failed almost everywhere it has been tried. Models are brittle and fail when you need the most: – mortgage models and the elaborate bank capital models failed during the financial crisis, for example. Experts have been regularly shamed by their failure to predict surprise election results or corporate scandals.
Leaders need a better way to find blind spots before they too suffer the same fate: humiliation and failure. But the best people have too little time to step back, and are swamped with too much information. Most advisors tell you that you are the problem: you are riddled with multiple biases and should not have confidence in your own judgment. ↓ (more below)
We take a different view. People fail because they get stuck. They optimize what they are doing already instead of adapting.
The answer is not to go back to “gut feel.” Instead, it’s to test assumptions, see things from a different perspective, and look for the gaps and limits to conventional approaches.
That is also exactly what you can’t do internally. You can’t see your own blind spots. You have too many internal vested interests, established routines, and familiar assumptions. But we can help you take action based on your own best judgment and skills. You just have to know where to look. We give you the chance to do something. ↓
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Here are some specific claims we make and things we look for:
Testing assumptions is more important than making spurious predictions.But you are usually surrounded by people who get overconfident about using the latest model or fad or slogan, or too devoted to the past. Every technique and viewpoint has boundaries and limits and flaws. (For example, what can go wrong with “big data”?) We have multiple indicators to watch for.
You likely don’t need more information or data. You just need to see what you already have differently. That’s the message from almost every major intelligence and policy failure. We have techniques to help you do that.
The most important things are usually hidden in plain sight. People don’t see those aspects because the patterns are too familiar, or taken for granted. Analysts don’t notice that other people see the same situation very differently, or they understand differences in a superficial, partisan or self-serving way. We can help by tracking false equivalences.
Models have a tendency to trap people.They work fine for simple matters, and are very good at eliminating inconsistency. But for complex problems you need flexibility and intelligence. That is what you are paid for: – otherwise you will be replaced with an optimal software algorithm. We can catalyse your own justified confidence, judgment, and skills. Every model needs an antimodel.
Instead of abstract principles or averages, look for concrete feedback loops and side-effects. Formal systems are usually too devoted to static rules. They miss complex and evolutionary behavior. We have specific patterns to look for.
The right amount of flexibility and adaptation are critical to survival, but almost all the pressures in business are to tighten efficiency and do more of the same, more intensely. You need ways to resist inertia. We can help you identify markers to keep you agile and alert.
Finding gaps and flaws and boundaries is a chance to do something about them. Instead of predicting an unknown future, test for what you are missing in the here and now. Finding flaws isn’t pessimistic. It is the key to leadership and creativity and hope. We can help you test rather than follow. ↓
Peter Hamilton is the Founder & President of Alucidate LLC, based in New York City.
He spent twenty years at the heart of global economic policy, first at the Bank of England in London and then at one of the principal companies advising global hedge funds and banks, located in New York City. He argued for many hours with many of the most prominent decision-makers in global markets and politics, looking for differences and misperceptions in the highest-level policy decisions.
He noticed that understanding misunderstanding was the most valuable asset for decision-makers. Blind spots are more important than fashionable “bias.” Leaders were frequently led astray by overelaborate models and swamped with too much data. He founded Alucidate LLC to help leaders do something about avoidable misperceptions.
Peter has a Masters Degree in International Relations from Cambridge University and a first-class degree in Philosophy, Politics and Economics (PPE) from Oxford University.