Jack Welch: Trust Your Gut In Deal-Making But Not In Hiring

Developing the confidence to go with your gut can take years. After all, without extensive experience, how do you know if your instinct is right or likely to lead you astray?

Jack Welch, the former CEO of General Electric, suggests a general rule of thumb in a recent post for LinkedIn: Follow your gut when evaluating deals, and be wary of it when hiring people.

That might sound counterintuitive, but Welch insists he hasn't got it backward. "Say you've been asked to invest in a new office building," he writes. "The deal's numbers are perfect, you're told; you can't lose. But your gut tells you otherwise." Getting that "uh-oh" response, he says, is worth listening to and will likely pay off in the long run.

On the other hand, Welch warns against trusting your gut in hiring decisions because he says instinct often "makes us 'fall in love' with a candidate too quickly." It's easy to be seduced by big-name schools, impressive resume experience, and a candidate who has all the right answers in an interview.

That's why it's important to follow up with references and make sure you're getting the full story. "When it comes to hiring decisions, doubt and double-check your gut," Welch says.

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