when to trust your gut for business decisions

How To Know When To Trust Your Gut Feeling

You have probably heard one of these phrases:

  • “Trust your heart.”
  • “Listen to your intuition.”
  • “Every time I didn’t trust my gut, I made the wrong decision.”

I personally heard this phrase a lot when I watch interviews of successful people, so my ears perked up. I took note. But I was skeptical. Is this actually a smart thing to do? Where’s the logic behind it?

Why You Shouldn’t Always Trust Your Gut

Blindly trusting your gut in all situations can lead to bad decisions. You can mistake your gut instinct for other things, like personal pleasure, laziness, or greed. Drug addicts can “trust their gut” (which is really just chase the pleasure of drugs) and and take lots of drugs, which can cause death, poor health, and debt. What if your friends tell you to drink alcohol, party all night, and not work hard? Your gut is probably telling you to listen because you don’t want to work. And as you know, that probably won’t end up well.

A blanket statement for trusting your gut can’t be right. But I believe there is some truth, and massive value in knowing when to trust your gut.

Why You Should Trust Your Gut (When It’s the Right Gut Feeling)

So we learned that we shouldn’t trust our gut in all situations. But is there any pay off for trusting your gut in the right situations? Well, Garry Kasparov believes so. Garry is considered by most of the chess community to be the best chess player of all time. He was ranked #1 for over 20 years.

In a speech he did called “How to Achieve Your Potential”, Garry says that trusting your gut is the most important thing in chess because there are more possible move combinations than seconds since the Big Bang happened. With such an infinite amount of possible moves to calculate, you have to rely on your subconscious to do some of the work.

In a Google talk, Garry went farther and said intuition is the most valuable quality of a human being. In his book How Life Imitates Chess, Garry says that top chess players are so tapped into their intuition in games that they often make more mistakes afterwards when they have all the time and technology they want to analyze their games.

Garry’s not the only one who believes something along these lines. Here’s a quote from the legendary founder of Apple, Steve Jobs, at a Stanford commencement speech:

“You can’t connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something – your gut, destiny, life, karma, whatever. This approach has never let me down, and it has made all the difference in my life.”

And here’s Jennifer Lopez, one of the most successful celebrities in the world on gut:

“I only do what my gut tells me to. I think it’s smart to listen to other people’s advice, but at the end of the day, you’re the only one who can tell you what’s right for you.”

“I think there are some elements that I look for when it comes to a rock movie or a DJ movie … the deciding factor is just always my gut.” -Dwayne “The Rock” Johnson, Forbes interview

Dr. Dre, rapper, founder of Beats by Dre, and the man who found Eminem said this in a Time interview:

“Everything that I do is for sound goals. It comes from my gut. When I’m sitting in the studio, a mix isn’t done till I feel it in my gut. It’s been the same way from the beginning, even when I was DJ’ing, if I heard a song that I wanted to play that I thought would be great in the club that night, I’d have to feel it in my gut.”

And Taylor Swift, who needs no introduction, said this in Rolling Stone:

“I base a lot of decisions on my gut, and going with an independent label was a good one.”

And here’s Dwayne “The Rock” Johnson, who Forbes pegged the highest earning actor of 2016, said in an Esquire interview:

“I’ve never gone wrong trusting my gut. It was really the only thing that I had going into acting.”

Henry Winkler, the actor behind the iconic character the Fonz, said:

“Your feeling about what’s happening knows everything. Every time I didn’t listen to my instinct, I was smashed in the head by a two-by-four.” Source: This video at time stamp 3:20

The well-known CBS sportscaster Pat O’Brien said:

“You got to listen to your heart. Nobody ever dose. Your heart is what you should follow” Source: Video at 5:25

Or look at what James Patterson, 87-time #1 best-selling author and one of the highest paid writers alive has to say:

“Don’t take ‘no’ when your gut tells you ‘yes.'” Source: Forbes September 2017 Issue

When Should You Trust Your Gut Then?

So when do you know it’s right to trust your gut? After a lot of research, I came to this conclusion:

Trust your gut on skills where you have years of experience or when deciding what your passion is. The more years you have, the more you can trust your intuition. 

“Our intuitions are only accurate in domains where we have a lot of experience.” -Adam Grant, Originals

In the book Originals, Adam cites the 2012 scientific study by Erik Dane that proved that people with high domain experience at a skill much more effective intuition. The first study was done in basketball. The second was done with people who were experienced with purchasing designer purses and those who weren’t. Sure enough, those who were more experienced were able to identify fake purses better.

Warren Buffett has over 60 years of business experience. He made a lot of mistakes, learned a lot of hard lessons, and managed to make billions of dollars. When he has a gut feeling, it’s not just a feeling. It’s a lightning-fast subconscious response that references decades worth of experience.

In fact, Warren himself has mentioned in many interviews that he stays in his “circle of competence.” Outside of what he is really good at (investing), he doesn’t try his luck or use his intuition. This makes perfect sense because his gut feelings in chess, which he sucks at, would likely be wrong.

In many interviews, he has admitted that he can decide whether or not to invest in a company in a matter of minutes. He has a dozen filters he consciously runs the company through, and then, he leaves it up to his decades of experience. When people call him to try to sell a company, he makes sure to cut the person off gently within minutes so no time gets wasted.

Garry Kasparov said in his book How Life Imitates Chess that a beginner chess player’s “gut instinct” is just luck. He says your intuition only kicks in when you have years of reference experience.

Dr. Dre said this in the Time interview:

“It’s a little bit hard to explain … It’s just a way that it makes you feel, and we’ve had that experience because of being in the studio for so long.”

Dr. Dre had many years of experience to work his gut instinct with.

The billionaire Richard Branson has a quote that also supports this idea of experience before intuition:

“Engage your emotions at work. Your instincts and emotions are there to help you. They are there to make things easier. For me, business is a ‘gut feeling,’ and if it ever ceased to be so, I think I would give it up tomorrow. By “gut feeling,” I mean that I believe I’ve developed a natural aptitude, tempered by huge amounts of experience, that tends to point me in the right direction rather than the wrong one. As a result, it also gives me the confidence to make better decisions.” -Richard Branson in Business Stripped Bare

Chip Heath’s book Decisive recommends weighing your gut decision against all the evidence and logic. Don’t just follow your gut. Use it as part of the decision process.

If you’ve extensive research and all or most of the evidence says Yes… AND it’s a skill you have over 10 years of experience in AND your gut says Yes, then that probably means go for it. It’s easy to say Yes or No when everything aligns. But what about when it doesn’t?

In this case, I suggest the rule of favoring a false positive over a false negative or vice versa. You want to avoid the one that has a much more destructive result.

For example, let’s say you’re a business exec with 25 years of experience. You’re interviewing a seemingly perfect candidate for a very important job. On paper, his resume shows him to be perfect for the job. He has all these references and data to prove it. You make sure there is no bias caused by nepotism or race. There isn’t. He’s white.

But your gut is telling you that there’s something off about him and that you’ve been burned in the past…

This would be a case of passing on him. A false positive would cause a lot of wasted time and money. The wrong candidate could destroy the organization.

There’s this element of trusting your gut that I find intriguing and useful. I have come across a few successful individuals who have said that each time they trusted their gut it worked out and each time they didn’t it screwed them over.

One of these videos was an interview from Henry Winkler, a famous actor. Another was from a TV host Pat O’Brien.

That got me thinking. When should you trust your gut and when shouldn’t you?

These are reputable actors but it’s not enough data points to fully trust this advice. What if your gut is telling you to do more hard drugs? That’s probably going kill you, and would be the wrong decision.

I think the answer is that you trust your gut in the things that you are good at. Let’s say you spent 20+ years becoming a chess grandmaster, master businessman like Warren Buffett, or basketball pro. You can probably trust your gut in that skill because you are so experienced in it.

At that level, it’s more than just a gut feeling. It’s an extension of all your business knowledge, experiences, and lessons learned culminating in one instinctual feeling. Chess grandmasters do this naturally. The youngest grandmaster in history Magnus Carlson is the newest prodigy in chess.

The youngest grandmaster in history Magnus Carlson is the newest prodigy in chess. I recently saw an interview from him where he admits that he instinctually knows the right move immediately in his gut.

Our ancestors often had to evaluate situations quickly and didn’t have time to assess things. This is why certain gut feelings and biases were valuable to them.

There are some areas where maybe you shouldn’t go with your gut because you lack experience and skill in that area.

Usually, it’s an area where there is not a lot of objective, measurable progress and success in your skills and achievements.

The next time you’re faced with a tough decision and a gut feeling, ask yourself, “Is this actually a gut feeling or just lust, pride, racism, sexism, or a motivation for short-term pleasure at the expense of long-term success? If so, don’t give into that feeling.

As far as using  your gut to find your passion, Steve Jobs said this:

“Have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.”

What If You Are Young and Have No Experience At All? Unique Situations To Trust Your Gut

So what do you do if you are young and have little experience in any skills? One thing you can do is borrow the gut of another. Get advice from a successful person in the area who has a lot of experience. It doesn’t have to be in person; it can be through interviews or books.

It turns out that for some areas of decision-making, you have millions of years of experience… in the form of evolution and genetics.

According to the book Mate by Tucker Max, women have a lot of pre-programmed, complex behaviors to find the best mate. Without them even thinking, they unconsciously look for subtle behavioral signs of status, intelligence, willpower, and mental health. They also scan for rape and danger. What does this mean for you? It means that the competition for survival of millions of years of your ancestors has granted you some genetic pre-programmed behaviors that you mistake for gut instinct.

When it comes to dating or safety, your gut is usually pretty accurate. It’s very deep, complicated, and unconscious. They’re not oftentimes consciously aware of what they’re doing. They often just naturally feel attracted or put off. Having said that, it’s far from perfect. This is one of the reasons why women still end up in poor relationships that end in divorce, cheating, debt, or toxic fights.

Having said that, this does not mean that all your genetics are suitable for the modern era. Just because they have been shaped for millions of years doesn’t mean they’re caught up with modern times. Fast food is a prime example. Most people eat way too much junk food and get obese because their genes are programmed for an age when salt, sugar, and fat were rare. They haven’t caught up to the recent agricultural developments. Evolution is slow.

You may want to trust your gut to a certain extent, but use your critical thinking as well. That is why it is there.

People bunch a lot of related terms together: “trusting your gut”, “trusting your intuition”, “following your heart”, “following your emotions”, and “going with your heart.” Those are just a few.

Remember that you shouldn’t take it too far! There is a line you cross where it is no longer a street-savvy gut choice. It can become a stupid emotionally or psychologically influenced decision that ends badly.

This happens even without the influence of drugs. You can make a lot of bad decisions because emotions and dozens of psychological biases serve you poorly so that you make a bad decision. Here’s an example: you are incredibly angered and choose to avoid paying taxes out of spite because your spouse should have paid. Guess what? You end up with a much bigger debt to pay off that you regret.

That could be misinterpreted as “trusting your gut” when it was just emotion-driven stupidity.

Another example is a bad decision based on psychological biases. Certain biases have served us well in our primitive past as humans that don’t work as well in modern times. There are many biases. One is contrast bias. Car salesman use this often. They throw out really big numbers and then get you to agree to a smaller purchase because of that. You have now just bought a $500 car accessory you wouldn’t have if it wasn’t for the $500,000 car he kept talking about.

Here’s an interesting video on a man who trusted his gut and it lead to his success in many areas. He kind of rambles but there might be some good points you can pick up from it:

See 10:00 time stamp and 18:00 time stamp in the video below:

Your Gut Is Not Just A Gut. It’s Deeply Scientific.

After reading the top books on evolutionary science for dating (The Red Queen, Why Women Have Sex and Why Beautiful People Have More Daughters), I realized we are not just humans. Instead, we are often walking robots with millions of years of programming wired to act in a certain way.

When a girl decides who she wants to date or marry, up to 90% of it is an unconscious, super complex process. Her genetics are assessing his pheromones (smell) for offspring compatibility, body movement for fitness, humor for mental health, and up to hundreds of other things. None of it is conscious on her part.

My theory is that your gut decision-making theory may work in the same way. Trust your gut whenever you are facing a decision that many of your ancestors have made because your genetics are made up of thousands of years of survival. The losers who made the wrong decision did not pass down their genes. Examples of situations this may apply is when you are talking to someone while traveling and you think he may mug you or when a girl meets a stranger for a date and something seems off.

A Hidden Resource of Experience

If you think you have no experience at anything yet, think again. You can sometimes underestimate how much experience you have. One area is social interactions.

Have you been tricked in the same way by someone multiple times? Your intuition often kicks in when it happens again so you are less likely to trust.

Look for other specific social interactions where you are experienced. It could be something like what you say first to a customer that walks in the door. Maybe those years of working at a fast food restaurant gave you experience on which greetings work.

Having said that, beware overreactions. One moderately traumatic event in your past could force you to over-calibrate in the other way. And in these situations, your gut is still wrong. Think of the woman who was cheated on by her first boyfriend and goes on to believe that all men are tricksters.

Trust Your Heart … Rate?

You’ve heard the saying “trust your heart.” Turns out it should be your heart rate:

A study published in Psychological Science was done on people who had never played a specific card game. The game was designed so that there was no obvious strategy to follow and it forced people to rely on their intuition.

The results were varied. Some people figured out it quickly while others struggled and never figured it out. They all tried to use their intuition and yet some failed completely. Their gut always made the wrong choice.

What they did find was that those who were more attune and aware of their changes in heart rate had a higher chance of getting it right.

What does this mean? There may be some use in being very aware of your heart rate at all times. One great way to get better at this is meditation.

The Other Best Time To Trust Your Gut

What’s the other absolute best time to trust your gut?

Easy. It’s when you have tons of experience in a skill and everyone is telling you this is the right decision, but your gut is screaming at you to run the other way. Sometimes, it could be this exact situation but not a scream — just a strong nudge.

This isn’t 100% accurate, but it may be a guidance force.

Now, why is this the best time to listen? Because this is a clear red flag that something you did not consciously think could screw up the whole decision. And your subconscious is aware of it. You may just not have picked up on what it is yet. Maybe, for instance, you are about to acquire a company that seems to be a great investment at a great price with great sales and economics, but you forgot to factor in the impeding foreign competition that will wipe you out.

Still, I would recommend you use this in situations where you have a lot of experience and skill. In the book Decisive, a case study was shown regarding a hiring decision for a large company. The hiring manager initially disliked an interviewee even though his resume showed he was perfect for the job. His gut told him to pass him up, but he resisted and hired him. He turned out to be the best employee he ever had. The book goes on to show statistics that prove that interviewing is the statistically worst predictor of job performance, behind personality tests and everything else.

When All Else Fails And You’re Unsure, Go With Your Gut

Obviously, we also have to acknowledge luck. Sometimes, some people are just gifted with the right genetics. Their sense of intuition for the skill (or even towards navigating life and people) are on point, far better than the average person. That’s another possible reason why some people get ahead with the gut concept.

But you may find yourself in a situation when you know you have no skill or experience but you need to make a decision now and there’s no experts or guidance to help you. Specifically, I’m talking about a situation when:

  • You know it’s not greed, laziness, pleasure from drugs, sexual pleasure, or gluttony that you’re confusing with your gut feeling.
  • It’s a situation that does not affect reliable skills shaped by tens of thousands of years of survival and reproduction, like rape or dealing with strangers.

I can’t say I have a definitive answer backed with tons of evidence. It could be a toss-up. It could be a 50% vs. 50% shot either way. If that’s the case, I believe the answer is obvious. Go with what your gut says. If it’s 50-50, you actually have a lot more support for going with your gut because of all the successful people I have mentioned who have said how they have never gone wrong going with their gut (and vice versa)

Conclusion & TLDR Summary

Here’s the Too Long Didn’t Read summary for you all:

  1. Tons of successful people emphasize how they’ve never gone wrong going with their gut and have screwed up by avoiding their gut.
  2. You may be misinterpreting gluttony, pleasure, greed, or laziness for “gut feeling.” They’re different. Avoid going with your “gut” on the former.
  3. There are some deeply programmed behaviors in our genetics from thousands of years of survival and reproduction where you should trust your gut, like when dealing with strangers or potential rapists.
  4. Most importantly, you should be more confident trusting your gut in skills where you have honed years, if not decades, of experience in because it’s more than a gut feeling, it’s a subconscious reference of your years of experience.

What’s your problems with trusting your gut? How have you tried to solve them? Let me know in the comments.

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  • james

    August 23, 2017

    Will, I subscribed to you blog and youtube channel a few days ago…I find it to be really good! The articles on your site (such as this one) as REALLY good (and I follow many other self-help sites/channels). Keep it up!

    • Will Chou

      August 24, 2017

      That’s a huge compliment. Thanks James. How did you find me?

  • Tinku Bhardwaj

    January 8, 2017

    Very informative and Everyone should read.
    Thanks you so much..:)

    • Will

      January 8, 2017

      Thanks Tinku for reading. Please share it if you’re helpful.


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