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An Eye for What Works
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An Eye for Business
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In this chapter, we saw how the four key elements of expert intuition coup d oeil, resolution, examples from history, and presence of mind are found in military strategy and many other fields of life. But what about business Rumor has it that most business decisions are made by gut instinct, otherwise known as intuition. Most companies try to replace this gut instinct with analysis, or systems, or some kind of orderly decision making all to no avail. Intuition still rules. Yet our lessons from other fields offer a different path. Instead of trying to stamp out intuition, we can study it, use it, and make it better in all our business decisions. Above all, we now know the difference between ordinary intuition and expert intuition. In ordinary intuition, you just have a feeling about something. In expert intuition, you draw on what worked before. The more you know about what worked before, the better your expert intuition. In business, as in war, in science, or in any other field of endeavor, you don t know what battle you can win until you see a way to win it. You don t know what problem you can solve until you see a way to solve it. You don t know what goal to set until you see a way to reach it. And you see a way by combining what works from past experience yours and anyone else s. And so we now turn to applying the art of expert intuition to our main subject: business success.
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CHAPTER
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The Art of Success
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Expert Intuition in Business
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presented the four key elements of the art of what works that von Clausewitz first identified: coup d oeil, resolution, examples from history, and presence of mind. We then found these elements again in different forms in modern research on expert intuition, in science, and in Eastern and Western philosophy. We now apply these four elements to business strategy. We have many studies to draw from that indicate the existence of expert intuition in business. We will take just a sample. In each of the studies, we look for our four elements in the cases the authors cite and in the explanations they provide. Again and again we find the same story: The art of what works is the key to success.
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Paul Allen and Bill Gates went to high school together in Seattle. There they worked with computers, as two of the many ama-
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44 T H E A R T O F E X P E R T I N T U I T I O N
teurs around the country who built and programmed their own machines. Their biggest success was a traffic-counting program they wrote for a microcomputer they had made themselves. After high school, Allen dropped out of college and went to work for a computer company in Seattle. In December 1974, he went to visit Gates at Harvard. On the way, he picked up the latest issue of Popular Electronics. There on the cover was the Altair, the world s first mass-market microcomputer, made by MITS of Albuquerque, New Mexico. Up to that time, computer owners had programmed their own computers. In the article on the Altair, MITS announced that it wanted to provide a single operating system with every machine. The company invited amateurs and professionals alike to try their hand at writing such a program. First Allen and then Gates had the same coup d oeil: to adapt their traffic-counting program for the Altair. It was written in BASIC, a simplified language that two Dartmouth professors had invented 10 years before. Dozens of other programmers set to work too, and many of them used BASIC. But Allen and Gates won the race. Allen traveled alone to MITS headquarters to run the program. It made a single calculation: 2 + 2 = 4. MITS gave them the contract. And so Microsoft was born. In Hard Drive, James Wallace and Jim Erickson quote Gates on the future of the software industry at that time:1
When Paul Allen and I saw that picture of the first Altair computer, we could only guess at the wealth of applications it would inspire. We knew applications would be developed but we didn t know what they would be. Some were predictable for example, programs that would let a PC function as the terminal for a mainframe computer but the most important applications, such as the VisiCalc spreadsheets, were unexpected.
Note how Gates cites predictable software applications: those in which a PC was an add-on to a mainframe computer. But unexpected applications made the PC a mini-mainframe all by itself. Microsoft, of course, made its fortune on the unexpected rather than the predictable strategy for PCs.
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