More neurobiology – yum!

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Hey-oh: it’s tax season! As we enter what can be a really stressful time if your default mode is procrastination, I’m here to deliver some good news about decisions that you might need to make under pressure. But first…

Housekeeping:

No government deadlines in February, but if you’re an S-Corp or LLP (partnership) your tax pro may have a February deadline. Many tax pros require you to have all your information submitted to them 2-4 weeks before the government’s March 15th deadline. Be sure to check with them and get your documents turned in on time, you’ll be their favorite client!

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Decision Making

Any business owner is required to make decisions, it’s part of the job description. I hear from many clients how crippling it can feel to lack confidence in a decision, and I identify with this problem.

Many clients come to us looking for clarity around their finances with the end goal of better, evidence-based decision making. I’m confident in the value of metrics in making business decisions because that’s both a result of my personal business experience, and the direct feedback I get from our happy clients. However, there are scenarios where compiling data and constructing a report is neither possible or prudent. In these instances, you may think that you’re making uneducated, impulsive decisions. But never fear: your unconscious brain can still make excellent, on-the-spot decisions in high-pressure, time sensitive situations. If you don’t feel like this is your strength yet, don’t worry – science can help your brain do this better.

The Locked Door

In his fascinating book, Blink, Malcolm Gladwell refers to our unconscious cognition as “coming from behind the locked door.” He describes the hidden parts of our mental processes that we can’t explain or recall. The part of the brain most closely associated with unconscious processing is the Ventromedial Prefrontal Cortex, which resides behind the nose. This critical part of the brain is responsible for lots of important processes, including decision making.

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“(The Ventromedial Prefrontal Cortex) sorts through the mountain of information we get from the outside world, prioritizing it and putting flags on things that demand our immediate attention.”

‘“Your unconscious acts as a kind of mental valet. It was taking care of all the minor mental details in your life. It was keeping tabs on everything going on around you and making sure you were acting appropriately, while leaving you free to concentrate on the main problem at hand.”
– Malcolm Gladwell, Blink, p. 58-59

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I usually experience my own intuition as a thought that materializes spontaneously. When I’m trying to work through something that’s mentally challenging, I take a shower as this is where I do my best thinking. In the shower, I’m making space for my Ventromedial Prefrontal Cortex to do it’s thing. (Plus, I’m then so fresh and so clean clean.)

Gladwell uses the term “thin slicing” to describe how the subconscious slices through the mountain of data, identifying only what is relevant, synthesizing it with our prior learning and then making that decision for us: all from behind the locked door. When our subconscious does the thin slicing, it’s impossible to recount how we got to the decision. We’ll either describe the decision being made on our ‘gut’ or, because humans are story-making creatures, we’ll create a logic-based story to describe what we can’t actually explain.

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“In high stakes, fast-moving situations, we don’t want to be dispassionate and purely rational. We don’t want to stand there, endlessly talking through our options. Sometimes, we’re better off if our minds behind the locked door make our decisions for us.”
– Malcolm Gladwell, Blink, p. 60-61

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Expertise also plays a major role in thin slicing. The more expertise you have in an area, the better the quality and reliability of your intuitive decisions will typically be. Gladwell goes into great detail explaining how most people are experts in recognizing how the combination of tiny facial muscle movements indicate emotions happening inside of another person. Most of us are so adept at this that our thin sliced read on someone’s face will override the words that they say. And this typically improves the more time we spend with an individual because our expertise in that person’s face increases.

Analysis vs Intuition:
“Creating Structure for Spontaneity”

Back in the late 1990s, the Pentagon anticipated that modern warfare was shifting away from the traditional two organized forces fighting in a battlefield, and towards attacks on cultures, economies and information. With the help of emerging technology, they theorized that they could ‘lift the fog of war’ by using analytic and systematic decision making. They tested these theories in a sophisticated war game called Millennium Challenge 02 in 2002, the most expensive – and arguably, most disastrous – war game in history. Pentagon staged a simulation of war between Blue Team, representing the US, and Red Team, representing the fascist dictator of some hostile nation (irony?). Then, they cast Lieutenant General Van Riper in the role of Red Team leader.

Lieutenant General Van Riper, called Rip by his friends, served a long and distinguished career in the Marine Corps. His men described him as “strict, fair, a gunslinger who doesn’t sit behind a desk, but leads his troops from the front, aggressive but in such a way that you didn’t mind doing what he asked.” He believed that war was inherently messy and unpredictable, that the ‘fog of war’ simply could not be lifted.

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“It’s not that he hated all rational analysis. It’s just that he thought it was inappropriate in the midst of battle where the uncertainties of war and pressures of time made it impossible to compare options carefully and calmly.”
-Malcolm Gladwell, Blink, p. 107

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Blue Team was equipped with tremendous intellectual resources and every toy in the Pentagon’s arsenal. Their planning was logical and rigorous, with matrices and computer generated predications. But on the day of the simulation when they issued their demand for Red Team to surrender, Van Riper did not act as the computers predicted. Red Team communicated totally offline with lighting systems and couriers. They launched a surprise hour-long attack that sank 16 simulated Blue Team ships.

Van Riper was an expert in this battlespace. He and his team did all the calculations and analysis ahead of time, and then he relied on the power of his team’s rapid cognition to execute smart decisions more quickly than their opponent. Van Riper’s training, rules and rehearsal created the structure for his team to spontaneously make excellent decisions, despite the immense pressure.

I’m a bookkeeper. Metrics are my bread and butter. I firmly believe that preparation with metrics and strategy that’s backed with data is critical to success, and I consider it my job to give you the structure that allows you to spontaneously make excellent decisions. But there will always be spaces where you need to rely on the ‘magic’ of your intuition. Like Quincy Jones said of creating something: “My feeling is always leave at least 20 or 30 percent of room for the Lord to walk through the room. Because, you know, then you’re leaving room for the magic.”

Leaving 20%-30% for the Magic

I had a great conversation with my colleague, collaborator, unofficial advisory board member, and hetero-life mate Jennifer Bower of Fortuna Money about Blink, and how to operationalize “leaving room for the magic” in your business. Here are three ways you can put this into action in your own business:

1. “Recognize that you don’t need to see everything to make a good decision.”
   Too much unnecessary information often leads to analysis paralysis. Distill your data sources so that you only process what’s relevant. As Van Riper said of the Red team victory:“A commander does not need to know the barometric pressure or the winds or the temperature. He needs to know the forecast. If you get too caught up in the production of information, you drown in the data.”
   -Malcom Gladwell, Blink, p. 144

Get into this mentality by staying out of the minutia and instead, diving into your zone of genius. You can take action towards this by hiring a righteous and perpetually engaged bookkeeper who determines what relevant data you need to know and then produces it for you.

2. “Part of refining your inputs means having an advisory board, even if your business doesn’t officially have a board.”
   Big corporations have decision-making C suites for a reason. Find a group of values-aligned business owners who care about your success, and have them weigh in on your tougher decisions. There are lots of mastermind groups that provide this framework for you. I recently joined BrainTrust here in Charlotte. I can testify to the value of having other (women, in my case) business owners, working in the same stage of business as I am, as a sounding board for the spectrum of choices I need to make. Their experiences often offset my blind spots and biases.IQ Bookkeeping offers a minimum of 30 minute monthly advisory meetings with EVERY client, dedicating a space for discussion about interpreting data and developing strategy so they can make the right decisions for their businesses.
3. “And for God’s sake, when it’s time to make decisions, turn down your distractions. Your subconscious can’t do it’s thing when it’s constantly being interrupted.”
   This can feel like a heavy lift in these turbulent days, but go get into nature, take a long shower, workout or get crafty, all sans technology. Our Prefrontal Cortex goes offline all together when we’re in ‘flight or flight’, so find the activity that soothes your nervous system and brings your Ventromedial Prefrontal Cortex back online. A new friend I met in my first Charlotte B Corp Collective meeting clued me into the Spotify playlist 741 Hertz. That frequency connects my brain back to my body, 10 out of 10.

The bottom line is that you are really well-equipped to make snap judgements when you are in your zone of genius, so stay there as much as possible and trust your gut. For everything else, turn to trusted business advisors and *curated* data for analysis and strategy. If you’re in need of an accounting team to provide you with that curated data AND the space to discuss it together, jump on our calendar and let’s talk about it!

IQBK Client Highlight

Kimberly Melton started Visual Story Media because she saw how much families struggle organizing their photo collection. Kimberly is a Certified Professional Photo Organizer with The Photo Managers. She specializes in helping families and businesses organize their digital images, printed photos, and old media, including slides, VHS tapes, and 8mm films. They transform photo chaos into a well-organized collection by adding keywords, sorting, categorizing and organizing photos in archival storage.

In addition to organizing, Visual Story Media creates beautiful highlight videos and personalized photobooks, ensuring cherished memories are preserved and ready to be shared for generations. Whether it’s a personal archive or a business collection, Visual Story Media brings a second life to your treasured memories.

Check out Visual Story Media’s website
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Thanks for reading!

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