Intuitive decision-making and firm performance

Abstract

Instead of a comprehensive analysis, company executives often listen to their intuitions or rely on their past experience; hence, intuition does play a critical role in management. In a sample of 234 Hungarian companies, we looked at the relationship between the decision-making approaches used and corporate performance and attitudes towards change. It turned out that decision-making based on past experience and intuitions are generally associated with better business results and better operational performance based on cost-effectiveness. In addition, we have seen evidence that companies that are more prepared for change and have greater capacity to manage change more effectively use an intuitive decision-making approach than those that are less responsive.