Decisions shape destiny: the crucial role of judgment in leadership

In 2007, after seeing Steve Jobs introducing onstage the long-rumored iPhone, Nokia’s CEO Olli Pekka Kallasvuo was unimpressed: “I don’t think that what we have seen so far from Apple is something that would any way necessitate us changing our thinking when it comes to our software and business approach”, he reportedly said to the press.

In just a handful of years, Nokia would see its 50% market-share in the mobile phone industry completely wiped off, and Kallasvuo’s decision to not consider Apple a threat until it was too late would fall down as one of the most consequential bad decision in the tech industry history.

Leadership is a complex endeavor, one that requires individuals to navigate a myriad of decisions, both big and small, on a daily basis. At the heart of effective leadership lies the ability to exercise sound judgment. These days information overload is the norm, and high-stakes consequences are always around the corner: leaders who possess strong judgment skills are better equipped to guide their organizations towards success. Sheryl Sandberg once said that “leadership is about making others better as a result of your presence and making sure that impact lasts in your absence”, capturing the essence of judgment's crucial role in leadership.

Good judgement is hard, it involves a multifaceted process that requires leaders to draw upon their knowledge, experience, and emotional intelligence. Effective leadership hinges not only on the ability to make sound judgments, but on the ability to do it consistently. Leaders face a wide range of decisions, from operational choices to strategic moves that shape the trajectory of their organizations. Good judgment enables leaders to evaluate alternatives, assess risks, and make decisions that align with the organization's objectives. Bad judgment can underscore devastating consequences.

Many factors can hinder or enhance judgment in leaders: common bearers of bad judgment include framing the wrong issue, being reactive or emotional, succumbing to ego or self-image, and failing to face reality. On the other hand, factors contributing to good judgment encompass having relevant knowledge and experience, considering shared values and vision, seeking diverse perspectives, and maintaining open-mindedness.

The importance of self-awareness, along with the ability to manage biases, and the courage to do what is right, can not be overstated.

Judgment is not necessarily an innate trait, but rather a skill that can be cultivated and refined. Developing good judgment is a continuous journey rather than a one-time event: it involves preparation, planning and execution of decisions, while learning and adjusting along the way. Leaders must strive for self-awareness, understand their own values, and seek input from trusted colleagues. By honing their judgment skills, leaders can make better decisions and foster a culture of effective decision-making within their organizations.

Going back to Sheryl Sandberg's quote, leadership is not only about individual accomplishments but also about empowering others and leaving a lasting impact. By prioritizing the development of good judgment, leaders can create a positive ripple effect that influences their teams, organizations, and even the broader society.

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