Name: Don’t Trust Your Gut
Rating: 3.9 (218 reviews)
Author: Seth Stephens-Davidowitz

What’s in it for me? Make better decisions through data analysis.

Let’s say you have a particularly difficult decision to make. What do you do? Make a list of pros and cons? Canvas friends and family for their opinions? Go online and search for advice in various forums? Turn to self-help books?

What happens if you do all those things and you still can’t come to a firm decision? Well, according to conventional wisdom, there’s one decision-making strategy that you can still use. And the good news is, it’s often framed as one of the simplest yet most effective strategies around: you can trust your gut. When you follow your intuition, the thinking goes, you’ll almost always make the right choice.

But here’s the thing: your gut is probably wrong.

Instead of trusting your gut, you should be following the data. These days, there’s more data available than ever before, and data analysis techniques are more sophisticated than they’ve ever been. And, time after time, the data shows that counter-intuitive decisions, choices that go against the prevailing tides of wisdom, are more effective than the so-called intuitive choices we make when we follow our gut.

You might not be feeling inspired to say goodbye to instinct and intuition – yet. But after this Blink to Don’t Trust Your Gut, you just might be.

Wall Street, Silicon Valley, and pro sports are all across data-driven decision-making.

When it comes to making important decisions, we’re often told to “go with our gut.” But that might not be the best advice. Contrary to popular opinion, you can’t always trust your gut. In fact, every decision you make based on gut feeling could be costing you – big time.

The best way to make effective decisions isn’t to follow your instincts; instead, you’re better off basing your decision-making process on data.

That’s right, data. Thanks to the internet, we have huge stores of data, from Wikipedia profiles to Facebook relationship status updates, at our fingertips. Advances in data analysis techniques mean it’s easier than ever to generate insights from these enormous data sets. Whatever your dilemma – whether you’re weighing up proposing to your partner or wondering about moving to a new city – odds are that some enthusiastic data scientist has crunched the numbers and generated findings that can help you make the right decision. And, when you look at the data for yourself, you might be surprised to find that your gut feeling was actually way off base.

Don’t believe me? From pro baseball to Wall Street, data analysis has underpinned a lot of winning decisions.

The Oakland A’s had one of the lowest payrolls in the league when they reached the playoffs in 2002 and 2003. Rather than trying to draft star players with high batting averages, manager Billy Beane looked at the data. The data showed that other metrics, such as time spent on-base or slugging average, were both better predictors of match success than batting average and undervalued by the market. With these insights, Beane was able to assemble a first-class team with a comparatively low budget.

In Silicon Valley, data is king. One Google designer quit the company over a dispute about which shade of blue to use in an ad link. The designer wanted to go with their intuition, choosing a shade that fit their design sensibilities. The data showed a different shade would lead to a higher click conversion rate. And guess what? Conversion metrics prove Google was right to trust their data over their designer.

Renaissance Technologies is one of the most prestigious, not to mention profitable, hedge funds on Wall Street. Founder James Simon started the company with something more valuable than seed money: he purchased a huge set of raw financial data. Simon, and a team of expert mathematicians, mined the dataset for patterns and trends. Now, every trade Renaissance makes is data-driven. And, in the years since its founding, Renaissance has delivered a 66 percent return since it was founded – pretty impressive, when you consider the S&P 500 delivered a 10 percent return in that same time period.

Ready to ignore your gut? The next four chapters will show you how to make better decisions with data.

Don’t hit the gym – to get more Tinder matches, try data!

Let me tell you about a friend of mine, who I’m going to call Eddie. Eddie’s single and, like a lot of single people who’d prefer to be coupled, he’s downloaded a few dating apps and uploaded his profile. Unfortunately, he hasn’t gotten a lot of matches. How can he boost his success rate?

Eddie’s gut feeling tells him that the more conventionally attractive someone appears, the better luck they’ll have on dating platforms. So, he could choose to hit the gym, whiten his teeth, and get a haircut. Would that be the right decision?

The data on happily ever after.

These days, AI technology is pretty impressive. AI can defeat human masters at games like chess and Go. It can predict emerging health issues, like Parkinson’s disease, before the patient notices that same issue for themselves. It can reliably pinpoint when social unrest will break out simply by analyzing discussions on Twitter.

But it can’t explain why some romantic relationships succeed where others fail.

Nature or nurture? The answer’s in the data.

New parents are expected to make, on average, 1,750 difficult decisions in the first year of their baby’s life. What should they call their bundle of joy? Breastfeeding or bottles? Cot or co-sleeping?

But research shows that these decisions might have very little to do with how a baby turns out. In other words: nature trumps nurture. Take the case of twins, Jim Lewis and Jim Springer who were raised separately from birth. When they reunited at age 39, both Jims were six-foot-tall and weighed 180 pounds. Both bit their nails and worked in law enforcement. Both had a childhood dog called Toy and both smoked Salem Lights.

Kernaussagen in Don’t Trust Your Gut

Worum geht es in Don’t Trust Your Gut?

Don’t Trust Your Gut (2022) turns that tried-and-true wisdom about trusting your gut on its head. Not only does trusting your gut instinct often lead you to make the wrong decision, there’s a pretty foolproof method to ensure you make the right decision – analyzing the available data and acting on it.