July 27, 2021 - 324 views|
Obsessed with automation, data and experience, modern businesses operate as if their every move was informed by gut instinct.
How does Serena Williams know where to move before her opponent has hit the ball?
How does Lionel Messi know to cut left just as the defender lunges in?
How does Sebastian Vettel know to take the outside line, when the inside line seems clearer?
Williams had an “immediate insight” that the ball was going deep in the deuce court; Messi, that the fullback had moved a fraction to his left; and Vettel, that debris close to the edge of the Formula 1 race track could puncture a tire and send him careening out of control.
All had an intuition, a sense of what they should do next. More often than not, their intuition is right. From such intuitions, legends are born.
Intuition is a mysterious thing. Some call it a hunch; others, a guess. But as we better understand the inner workings of the brain, whether through neuroimaging, positron emission tomography or other sophisticated medical tools, we are learning that intuition is not an ethereal spirit roaming free deep in our unconscious, but a mechanistic process that analyzes information captured through our senses from the second we are alive. As Herbert A. Simon, the psychologist and Nobel laureate in economic studies, has said, “Most of what we call intuition, to respond to situations and just act, is based on an enormous accumulation of experience.”
In short, intuition isn’t a mystery at all. It is a biochemical feat of engineering.
And what is true of people is increasingly true of businesses, too. The best modern enterprises act with the intuition of the great sport stars — faster, more precisely, more confident in their understanding of what to do, where to go, how to act. To invest, or not. To raise prices, or not. To hire this person, or not. Like great masters, they build mechanistic processes that capture information, accumulate and synthesize data, refine theories based on what works and what doesn’t. The best businesses engineer the speed and insight of intuition into their organizations.
How do leading enterprises act intuitively? How do they anticipate and act instantaneously? By engineering systems and processes based on machine-learning software, layered on top of hyperscale cloud processing power, manipulating brontobytes of data, aligned with business processes that create hyper-personalized, next-generation, consumer-grade experiences. By using modern tools and techniques that deliver outcomes fit for modern times. By decommissioning infrastructures and systems and interfaces that are no more than “legacy debt.” By hiring talent that is truly digital.
“Intuition engineered” is the new goal for every business that wants to outperform in the Fourth Industrial Revolution, and beyond. As Gartner puts it: “The ability to predict outcomes, quickly assess innumerable alternatives and take action … must become a core competency embedded throughout the organization.”
With the right systems — machine learning-based software running on hyperscale platforms — the right data — the data generated by billions and billions of cloud-connected devices and “things” — and the right effort — engineering modern business processes and experiences with modern software development methodologies — extraordinary business results can be achieved.
By trusting data and leveraging modern software engineering principles, any organization can engineer intuition and become a modern enterprise. These three actions (among many) are foundational to propelling your enterprise toward this objective:
Become obsessive about data. In our work with clients, we have a one-question litmus test to determine a company’s digital readiness: Do they act on what the data tells them? If they do, this is a good sign the company is making true progress toward engineering intuition. “Execution of complex decisions” and “execution of routine, rules-based decisions” are both areas in which high-performing respondents in our recent study expect to see a significant transition toward machine-based decisioning in the next three years — from 16% to 24% and from 15% to 23%, respectively. Just as most stock trading is now undertaken by machines, complex decision-making is increasingly being done more quickly and effectively by machines.
Become obsessive about automation and modernization. Put simply, if you wish to compete at Amazon cost and Google speed, you have to automate and modernize significant portions of your operations during the next few quarters. Organizations that are engineering intuition are automating processes in ways that make the last 25 years of Six Sigma and business process reengineering (BPR) seem like a mere overture to a major symphony. This is foundational work, yet it is work still to be undertaken by millions of organizations around the world. McKinsey estimates the percentage of companies that have automated at least one process end-to-end at 31%. Moreover, only 10% of companies use modern software engineering methods (MSE) in 50% of their projects, and only 7% use MSE “at scale.”
Become obsessive about enhancing your employees. Building modern systems is simply a means to an end. That end? Making your employees more efficient, more productive, more resilient, more valuable to their customers and more satisfied in their work. As consumers, we favor companies with staff who are fast, precise and seem to enjoy their work — because they are using systems that enable them to anticipate what their customers need, so they act to supply it. Blending automation with AI and other cognitive technologies frees employees from repetitive tasks and augments their capabilities, unleashing productivity and innovation. As employees, we want to work for an organization that offers the tools to do great work, rather than one mired in drudgery and inefficiency.
With these three obsessions at the forefront of their strategy and tactics, businesses will have the wind at their back. Without them, there is tough sledding ahead.
As the author of many seminal works on decision-making, psychologist Daniel Kahneman wrote , “You’re better off if you collect information first, and collect all the information in a systematic way, and only then allow yourself to take the global view and to have an intuition about the global view. This applies in many domains.” Including, we believe, how a business should set out to engineer intuition.
To learn more, read the full report “Intuition Engineered: The Theory and Practice Behind Engineering Intuition into Business.”