Silicon Valley Bank, Signature Bank, FTX, Terra…All financial services companies that attracted the best and brightest – as executives and clients.

All of which have spectacularly melted down. Because smart people made dumb decisions. And other smart people saw it happening and did nothing.

I Love Smart People

One of my favorite aspects of my job is that I spend time with so many smart people. I spend lots of time with boards, executive teams, partners, or technical leaders. People who are creative and insightful. People who find or create solutions to complex problems. People who are curious, inventive, and entrepreneurial.

It’s a gift. I get to spend my time with people who know much more than I do. People do all kinds of things I can’t. Just being around them expands my perspective and fuels my growth.

But Rooms Full of Smart People Don’t Always Make Smart Decisions

It’s easy to think that, “If we can get enough big brains together, we’ll solve the problems.”

Unfortunately, big brains often create as many problems as they solve. Arguably, the biggest problems we face in the world have been created or exacerbated by people with big brains.

Being intelligent and making good decisions are not the same thing. This dynamic is only magnified when there is a room full of intelligent people.

A Short List of Common Ways a Room Full of Smart People Do Dumb Things:

1. Smart people are afraid of being dumb: Smart people are afraid of asking dumb questions. They are afraid of demonstrating that they don’t know or understand something.

Instead: Ask questions. Request that people explain the acronyms or define their words or lay out their logic. Chances are high that you aren’t the only one who didn’t understand. But even if you are, make sure you do understand. Especially if you are making decisions off of what was just said.

2. Smart people don’t always understand what they are saying: If you can’t explain it simply, you probably don’t understand it. Smart people often bury themselves in jargon and techno-speak to be safe, lazy, impatient, or to simply signal superiority. This is as opposed to figuring out how to be understood by their audience.

Instead: Embrace the intellectual exercise of finding simple ways to explain complex things. It’s one reason I make heavy use of analogies and metaphors.

3. Smart people can move too fast: Smart people often seek expediency. They can be impatient. So, they take shortcuts. They don’t read the instructions. They skip steps. It creates problems.

Instead: Be willing to slow down. Differentiate your need for action or closure from the issue’s need for thought or due process.

4. Smart people get crippled by analysis paralysis: The opposite of the problem of expediency. Smart people can get so lost in trying to get the right or best answer that they never act at all. Analysis paralysis – the search for perfect – is damaging. I’ve never encountered an organization that benefitted from it.

Instead: “Success loves speed,” says Craig Ballantyne. Learn to quickly recognize and accept what is “good enough”.

5. Smart people confuse what works on paper for what works in the real world: Don’t get lost in your spreadsheets or smart board scribbles. As Mike Tyson says, “Everyone has a plan until you get punched in the mouth.”

Instead: Your ideas are only as good as their ability to survive “in the wild.” Get your ideas out there. Let them be tested by others and by life. It’ll make them stronger.

6. Smart people don’t question their own assumptions: Smart people make assumptions. They jump to conclusions. They become married to pet theories. They are just better, faster, and more involved in their ability to support confirmation bias.

Instead: Learn to recognize assumptions. (When might I mistakenly believe I know what someone else is thinking about something?) Learn to invite dissent and debate.

7. Smart people are too busy: Many smart people are just too busy doing too many smart people things. They serve on too many boards. They run too many teams. They have too many projects going on. So, they never give any one thing the time and attention it needs. They hope that the other smart people in the room are putting in more time and attention than they are.

Instead: Stop it. Being busy isn’t being effective.

8. Smart people confuse being clever for having character: Smart people get so involved in how ingenious something is (or they are) that they forget to consider if it is ethically or morally right.

Instead: Values matter. In the long run hubris, greed, impatience, revenge…these have brought down more organizations and leaders than simple technical errors. Be ethical. Do the right thing.

Take good care,

Christian

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Did you miss it?  Catch my interview on the rebroadcast of the Shrimp Tank podcast, the #1 Entrepreneur podcast in America, here:  http://bit.ly/40aG3ZO

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