Recently finished reading Checklist Manifesto, and thought this excerpt was great:
Some years ago Geoff Smart, a PhD psychologist who was then at Claremont Graduate University, conducted a revealing research project. He studied fifty-one venture capitalists, people who make gutsy, high-risk, multimillion-dollar investments in unproven start-up companies. Their work is quite unlike that of money managers, who invest in established companies with track records and public financial statements one can analyze…
Then there were investors Smart called Airline Captains. They took a methodical, checklist-driven approach to their task. Studying past mistakes and lessons from others in the field, they built formal checks into their process. They forced themselves to be disciplined and not to skip steps, even when they found someone they “knew” intuitively was a real prospect.
Smart tracked their success over time. There was no question which style was the most effective — and by now you should be able to guess which one: the Airline Captain. Those taking the checklist-driven approach had a 10% likelihood of later having to fire senior management for incompetence or concluding that their original evaluation was inaccurate. The others had at least a 50% likelihood.
The Airline Captains had a median 80% return on investments studied, the others had 35% or less… The most interesting discovery was that, despite the disadvantages, most investors were either Art Critics or Sponges — intuitive decision makers instead of systematic analysts. Only one in eight took the Airline Captain approach. Smart published his findings more than a decade ago. When I asked him, now that the knowledge is out, whether the proportion of major investors taking the more orderly, checklist-driven approach has increased substantially, he could only report: “No. It’s the same.”
We don’t like checklists. They can be painstaking. They’re not much fun. But I don’t think the issue here is mere laziness. There’s something deeper, more visceral going on when people ask away not only from saving lives but from making money. It somehow feels beneath us to use a checklist, an embarrassment. It runs counter to deeply held beliefs about how the truly great among us — those we aspire to be — handle situations of high stakes and complexity. The truly great are daring. They improvise. They do not have protocols and checklists… Maybe our idea of heroism needs updating.