Some people just have better judgment than others. And, when it comes to leadership, judgment is key not only for advancing people’s career to the top, but also for ensuring the welfare of teams.
Indeed, if we think of leadership as the capacity to inspire unselfish group behavior in the quest of a collective goal, then a leader’s judgment is the critical force driving the decisions, behaviors, and performance of a team.
What teams want in a leader is not authority or power, but the capacity to guide them in the right direction. It is for this very reason that teams outsource their key decisions like assigning roles, selecting a strategy, and responding to a crisis to a chosen individual, the leader.
Unfortunately, there is no shortage of examples for inept leadership decisions and their catastrophic consequences, so the assumption that leaders are, by definition, better decision makers, is at best optimistic and at worst utopian.
For example, errors in judgment explain why Nokia and Kodak decided not to enter the smartphone and digital photography market, respectively, and why a dozen publishers decided it was not worth publishing J.K. Rowling’s Harry Potter series, which has since sold over 400 million copies.
It is therefore crucial to select leaders with good judgment and to develop good judgment in leaders. In order to achieve this, we must first understand the fundamental elements of good judgment.
If each of these four components can be identified and nurtured, the probability of poor leadership decisions will decrease, and vice versa:
Expertise–what leaders know–is key for gaining approval and respect from followers and subordinates. Leaders without expertise are perceived as incompetent.
At the same time, expertise alone does not ensure that the right decisions are made. Leadership involves making decisions under uncertainty, so expertise is often less useful than experience, emotional intelligence, and intuition.
Also, since most real-world problems don’t have a clear-cut solution, leaders’ ability to persuade subordinates and followers that their decisions are right are as important as their actual decisions. It is for these two reasons that so many technical experts have very little potential for leadership.
Whereas expertise refers to what you know, metacognition is about being aware of what you know and what you don’t.
Leaders with good metacognitive skills are aware of their reasoning biases and, because of that, they are able to minimize their adverse effects on decision-making. Good coaching programs and accurate psychological assessments can help leaders to build better metacognitive skills by highlighting their default thinking patterns and how their behaviors are likely to impact on subordinates and followers.
In essence, then, metacognition is about self-knowledge and awareness of one’s limitations.
Although expertise and metacognition can be nurtured over time, especially with deliberate coaching interventions, some leaders are much more coachable than others, which, in the long run, enhances their flexibility and adaptability.
Indeed, people’s willingness to pay attention to negative feedback, accept their mistakes, and learn from experience is a fundamental determinant of good judgment, and some leaders are much more capable of this than their peers.
As author and lecturer Randy Pausch said, “experience is what you get when you didn’t get what you wanted.” In reality, many leaders appear to be immune to experience, because they never admit to being wrong, and because their capacity for reality-distortion surpasses their ability to accept mistakes and learn.
No matter how much expertise, metacognition, and coachability leaders display, if they don’t have integrity, their decisions will be focused only on achieving personal goals, often at the expense of their followers’ or subordinates’ well-being.
Bernie Madoff, Dominique Strauss-Kahn, and Richard Fuld were superstars in their respective fields, not least because of their undisputed expertise and accomplishments. But perhaps due to their excessive greed, megalomania, or sociopathic character, they all fell victim of poor judgment.
The most important aspect of integrity is reputation. That is, integrity is mostly in the eye of the beholder. If leaders are untrustworthy, their decision-making capacity is irrelevant because their subordinates will question whether they are willing to do the right thing, even if they are able.
To sum up, leadership is a key resource for any team or group of individuals, and their welfare depends on the decisions leaders make. Any decision is a choice between perceived alternatives, and good judgment enables leaders to make the best decisions for the group.
This requires not only expertise, but also self-knowledge, coachability and, above all, integrity. When companies evaluate leadership or talent decisions, and when individuals decide on which leader to choose, they should take these four criteria into account.
—Tomas Chamorro-Premuzic is an international authority in psychological profiling, consumer analytics, and talent management. He is a professor of business psychology at University College London, vice president of research and innovation at Hogan Assessments, and has previously taught at New York University and the London School of Economics.