Michael Mauboussin on Intuition, Experts, Technology, and Making Better Decisions

Michael Mauboussin, Credit Suisse
Michael Mauboussin, Credit Suisse


Welcome to The Knowledge Project, an experimental podcast aimed at acquiring wisdom through interviews with key luminaries from across the globe to gain insights into how they think, live, and connect ideas. The core themes will seem familiar to readers: Decision Making, Leadership, Innovation. But it also touches on questions about what it means to live a good life.


The first episode of The Knowledge Project features Michael Mauboussin, the head of Global Financial Strategies at Credit Suisse. He's also written numerous books, including More Than You Know: Finding Financial Wisdom in Unconventional Places, Think Twice: Harnessing the Power of Counterintuition, and most recently The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing. More importantly, Mauboussin spends more time thinking about thinking than most people.

In this episode we explore parenting, daily routines, reading, and how to make better decisions.


A transcript is available for members.

Here are a list of books mentioned in the podcast:


In this excerpt from the podcast, Mauboussin comments on the role of intuition in the decision making process:

The way I like to think about this, and by the way there's a great book by David Myers on this, called “Intuition.” It's a book I really would recommend. It's one of the better treatments of this, and more thoughtful treatments of this.

The way I think about this is, intuition is very domain-specific. Specifically, I would use the language of Danny Kahneman – System one, System two. System one is our experiential system. It's fast, it's automatic, but it's not very malleable. It's difficult to train.

Our System two, of course, our analytical system, is slower, more purposeful, more deliberate but more trainable. Intuition applies when you participate in a particular activity to a sufficient amount that you effectively train your System one.

So that things become, go from your slow system to your fast system. Where would this work, for instance? It would work in things like, obviously, with things like chess. Chess masters, we know, they chunk. They can see the board very quickly, know who's at advantage, who's not at advantage.

But it's not going to work… So, the key characteristic is it's going to work in what I would call stable linear environments. Stable linear environments. Athletics would be another example. For long parts of history, it was in warfare. Certain elements of warfare would work.

But if you get into unstable, non-linear environments, all bets are going to be off. There is a great quote from Greg Northcraft, which I love, when he says you have to differentiate between experience and expertise. Intuition relates to this.

He said expertise… An expert is someone who has a predictive model that works, and so just because you've been doing something for a long time doesn't mean that you have a predictive model that works.

I would say intuition should be used with a lot of caution.

The key is to have disciplined intuition.

(Danny Kahneman) said, “You know, you're going to have these base rates, or statistical ways of thinking about things, and then you're going to have your intuition. How do you use those two things, and in what order?”

The argument he made was you should always start with the base rate the statistical approach, and then layer in your intuition. He called it “disciplined intuition.” Otherwise, if you go with your intuition first, you're going to seek out, right, you're going to seek out things that support your point of view.

I always think about it that way. I know that a lot of people make decisions using their gut or their intuition, but I don't know that that's the best way to do it in most settings. Some settings, yes, but most settings, no.