Psychologist and television personality Dr Joyce Brothers once said: “Trust your hunches. They’re usually based on facts filed just below the conscious level.”
As an entrepreneur and business owner, you’ve come to rely on your gut instinct. You take risks based on what you “feel” is the best course of action. You sell when you “think” it’s right; you ignore the psychometric tests and hire someone you “just feel good about”. As Brothers points out, we often don’t give our hunches enough credit. They are usually based on instinct that has been honed over time; a series of experiences and wisdom that has been built up subconsciously. Very often, your gut feel will be one of your most valuable resources.
But here comes the other side of the argument: Those who rely solely on their instincts often come up short. Victor Hwang wrote in 2013 for Forbes magazine: “For over a century, the overriding philosophy in business has been that rational decision-making is better business. Irrational decisions, on the other hand, were to be avoided. We’ve probably all seen bad executive decisions made based on miscalculated fears, misperceived threats, or misdirected loyalties.”
And much of the business world is undeniably rooted in numbers: it turns out the time you “thought” it was right to sell coincided with record prices in the industry, and the time you “felt” it would be best to shed an asset came just before a slowdown in the economy.
Recent research, however, points towards the notion that “the bifurcation between logic and emotion is not so clear cut,” writes Hwang. “There is business value lurking in what appears to be irrational.”
Neuroscience business expert Janet Crawford elaborated. “The problem is that most of what we view as being rationally determined isn’t. Viewed from the lens of brain science, emotions are elegant shortcuts that allow us to sort through reams of implicitly stored (i.e. outside consciousness) neural patterns and generate feelings that guide us toward or away from a course of action. Without emotion, we are biologically incapable of making decisions. Logic is often the last step in the process.”
So where does this leave you as a business owner?
New research suggests that you should place more emphasis on your emotions than you once did. But experience would caution against making every decision based on the “feel” of things. At The Finance Team, we think the perfect solution lies in having an accountant on call. These are the reasons why:
- An accountant on call won’t try to steer your decisions in a certain direction. This finance executive is there when you need him to be – and no more. Unlike having a full-time financial manager who will attempt to sway your decisions with talk of cost-cutting and the bottom line, your accountant on call will be there to answer questions, not run your business.
- An accountant on call will help clarify murky decisions. Sometimes the obvious path of action seems so clear; at other times you can’t decide between two possibilities. At this point, your accountant on call can give you a different perspective. Their financial insight can often illuminate the best course of action.
- An accountant on call can help you trust yourself. Sometimes you think you know what the right decision is, but it will involve considerable risk to yourself and the business. It’s a nerve-wracking step to take! This is another perfect opportunity to consult with your accountant on call. He or she can provide the numbers to back up why your decision would be a good one, giving you the courage and confidence to take the leap.
This is the fruition of a process outlined by Crawford, one that’s been happening for centuries without us realizing it: “The conscious intellectual brain steps in to produce a rational backstory to justify impulses generated in the murky corners of the unconscious mind,” she says. In other words, your brain will tell you why you can trust your instincts. And your accountant on call will help you do that.
As a business owner, learning to trust your implicit knowledge is invaluable to your role. Having an accountant on call can help you achieve this. Contact The Finance Team to find out more about how to get a qualified finance professional on your side.
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