A speculation based on past experience or knowledge, the educated guess has bad reputation because it is often confused with touchy-feely decision-making, aka uneducated guess. If, like me, you have a background in exact science (computer science) and have been drilled in analytical thinking (MBA), you are understandably wary of decisions that are not backed by strong evidence.

As a visual gimmick, here's my educated guess about the scale of analysis, which illustrates the different levels of depth of "analysis".

Contrarily to the common belief, successful people effectively rely on educated guesses in their work and in their life. Why is the educated guess such a powerful tool? The educated guess provides answers in several real-world situations.

• Lack of time: a good decision on time is better than a better decision too late.
• Cost exceeds benefit: the cost of collecting the information and of conducting the analysis exceeds the benefits of the analysis.
• Information is not available: better make the decision with uncertainty than not make it at all.

Now the simple concept of educated guesses takes a whole new dimension. We discover that the ability to solve a problem when lacking time and information, which is the norm in business as well as in life, greatly depends on educated guessing.

Leveraging the educated guess also points to the delicate balance between analyzing and doing. Let me elaborate. In business management, in IT projects, and in many other situations, analyzing everything up-front before taking action is unrealistic or undesirable, for the reasons mentioned earlier. The key is to analyze what is strictly required, and no more, in order to perform the first action, hence the importance of incremental (or iterative) development in business. The two extremes - over-analysis and diving head-first - are equally damaging. The key success factor is to understand when to stop thinking and when to start doing, and then when to stop doing and when to refine thinking, and so on.

Unfortunately, some hide behind the educated guess simply because they are not able to perform a good analysis. The educated guess then becomes an excuse for sloppy work. Actually, effective educated guessing requires experience and excellent analytical thinking. Good educated guessers are drilled in analysis techniques, which is why they can bridge information and time gaps while keeping their feet on the ground.

But what does an educated guess look like? Sometimes, it is pure thought and is communicated verbally only. I prefer the one-pager format. As the name implies, the one-pager is a standard page of paper that presents the key information and decision. There may be tens of facts and alternatives leading to the decision, but the one-pager forces me to highlight only the most relevant and to recommend or decide a course of action. It's not only a tool suitable for educated guessing; it's also a powerful communication tool (I'm sorry to inform you that almost no one reads documents that are more than a few pages long).

In conclusion, remember that the required depth of an analysis depends on the context. In many instances, a good educated guess will lead to the best outcome: a big, quick step in the right direction.