Back in March I posted on the role of assumptions in developing the business and financial model. The important point was that the assumptions represent the key risks in the business model. Yesterday I read a good post on recruiting in the Private Equity and Venture Capital Recruitment blog. In the post the author suggested that one should trust their intuition and check their assumptions. The key point was that your intuition is frequently a better indicator than a rigid checklist approach.
My definition of intuition is " facts that you cannot articulate". Therefore, when you rely on intuition there are a series of facts and certain assumptions which logically lead to the conclusion--the intuition. I have on many occasions worked with highly intuitive people. Frequently I have been able to put togeher the facts and assumptions that led to the intuition. There are two points here.
- For most intuitions the facts can be discovered, if you work at it--perhaps with another person
- The assumptions in the intuition represent the risks in the decision or conclusion
I do not use intuition much and never have, but I have great respect for intuitive people. However, I always take the time to construct the facts and the assumptions in an intuition in order to identify the risks or the errors in logic.
Another technique I always use is the "smart man" hypothesis. Whenever, you are trying to understand something like an intuition, assume the person is very smart. By assuming they are very smart, you force yourself to find the facts and the assumptions that would logically lead to the smart man's conclusion. Dismissing something as "woman's intuition" or "off the wall" usually means that you were not willing to put in the effort to understand how a smart man would have arrived at the conclusion.
Note: I learned about the smart man hypothesis back in the early 1980s. It has served me especially well in better understanding many, many people and their thinking. I am sure it has been renamed to be more gender neutral but I do not know the new term.