272: Evaluating Judgment

An employee makes a baffling decision or offers a bizarre take on a company issue that leaves you wondering, "What were they thinking?"

This is a situation I have encountered from several clients in recent weeks.

Good leaders want to encourage their team to act independently and not be micromanagers or dictators. But success requires distinguishing between good judgment, reasonable disagreement, coachable mistakes, and fundamentally poor judgment.

This distinction matters enormously. Reasonable disagreements and even mistakes (when used as a teaching moment) can strengthen your organization.

Poor judgment, especially in senior roles, can destroy it.

What is Judgment?

Good judgment isn't just about being right or wrong—it's about the quality of thinking that leads to decisions. Good judgement also isn't just having the same opinion as the person in charge. New perspectives and opinions can help a team driver greater results over time.

When we evaluate judgment, we're asking: Given the information available and the context, was this a reasonable thought process?

For instance, in 2016 (which feels like a lifetime ago), Reed Hastings, then Facebook's board chair, helped clarify the difference between different judgment and bad judgment when evaluating fellow board member Peter Thiel.

In an email reported by the NYTimes, Hastings wrote:

Peter,

I appreciate that we can disagree and be direct with each other. I have our board Gordy feedback session tomorrow. I see our board being about great judgment, particularly in unlikely disaster where we have to pick new leaders. I’m so mystified by your endorsement of Trump for our President, that for me it moves from ‘different judgment’ to ‘bad judgment.’ Some diversity in views is healthy, but catastrophically bad judgment (in my view) is not what anyone wants in a fellow board member.”

I continue to experience you as very honest, well intentioned, and certainly very independent. No response necessary, I just didn't [want] to say this stuff behind your back.

As CEO of Netflix, Hastings advocates "farming for dissent" as a way to make better decisions so he's not just butt hurt that Thiel isn't favoring his own political leanings. Even in 2016, and now very clearly in 2025, Trump's authoritarian tendencies, incoherent policies, endless self-dealing, and habit of hiring completely unqualified staff makes him a poor choice for leading the most powerful nation on Earth.

While Thiel surely had his reasons for endorsing Trump, Hastings questioned Thiel's judgment when it came to selecting leaders who would serve their constituents well—whether the American people or Facebook/Meta's team, customers, and shareholders. In Hastings' view, Thiel had shown poor judgment in this area and made it very clear in his email.

A Framework for Evaluating Judgment

Let's bring the concept of judgment closer to home. For most founders and leaders, judgment is how you draw the line between disagreement, error, and serious concerns.

Different judgment - you can disagree all day, and as long as you provide good evidence or logic and ultimately commit to the final decision, this is fine, and in fact encouraged. Sometimes different judgment can unlock breakthrough insights (as I often say in regards to outliers).
Flawed judgment - mistakes and failures will always happen in business. But if the work was well-intentioned, the situation was novel or highly complex, and the individual quickly rectified the issue while taking steps to reduce the likelihood of future occurrences, these can happen moderately often and still be acceptable.
Bad judgment - this is where repeated instances of poor thinking, failing to consider obvious facts, or acting against the company's interests become grounds for demerits or dismissals.

There's also different areas of judgment that we need to consider when evaluating performance. An employee might be strong in one particular area while simultaneously being weaker in another area of their responsibilities. This creates a complex picture that requires nuanced assessment rather than broad generalizations.

For instance, someone could demonstrate excellent technical judgment when it comes to problem-solving and analytical thinking, yet struggle with interpersonal judgment in team dynamics or client interactions

Strategic—did you make a good plan?
Executional - did you execute the key tasks in the plan at a high caliber?
Social - did you handle interpersonal relationships well?
Ethical - did you act with integrity?

Presenting an improperly formatted spreadsheet at an internal team meeting might be an example of forgivable flawed judgment in execution.

However, lying about a family member's death to get bereavement leave (a huge breach of trust!) would represent bad judgment in the ethical category and a potentially fireable offense.

There's also the matter of seniority. An entry-level hire versus a senior staff member versus an executive should be held to different levels of judgement.

A new engineer who sometimes underestimates how long a task might take by a few days is showing flawed execution judgment—they simply lack the experience to make perfect estimate.

But an experienced CTO who doesn't build buffer time into their estimates for last-minute rollout issues and bug fixes during major releases shows poor execution judgment—they should know better and anticipate these problems.

Finally, we should expect senior leaders to have meta-judgment or a kind of business self-awareness.

A product designer might argue passionately for a different business model without recognizing they don't fully understand the financial, legal, and regulatory implications. But a VP of Design should have the self-awareness to share their opinion while also recognizing where their judgment abilities end—and where they need to defer to others or seek higher-quality input.

Having the Judgment Conversation

When you need to address judgment issues, focus on the thinking process rather than just the outcome.

Script Framework:

Set the context: "I wanted to discuss the decision to [specific action]. This is important because [impact/stakes], and I want to make sure we're aligned on expectations for [their role level]."
Understand their full reasoning: "Walk me through your thinking process. What factors did you consider? What information did you have at the time? How did you weigh the different options?"
Assess contextual factors: Consider (but don't necessarily voice) their seniority level, time with the company, and whether this type of situation is familiar to your organization. Ask: "Had you encountered a similar situation before? What made this particularly challenging?"
Share your perspective and invite dialogue: "Here's how I see it differently... [specific reasoning]" Then pause and ask: "What's your reaction to that? Do you see any gaps in how you approached this that you might handle differently next time?"
Categorize the judgment issue: Based on their responses, you may want to be clear about your assessment:
- Different judgment: "I can see your logic, and while I disagree with the conclusion, your thinking process was sound for someone at your level and I'm open to trying it."
- Flawed judgment: "I think there were some key factors you missed here, which is understandable given [context]. Let's talk about how to strengthen your approach next time."
- Poor judgment: "This decision ignored some fundamental considerations that someone in your role should anticipate. This is a pattern I'm concerned about."
Set clear expectations: "Going forward, for situations like this, I expect you to [specific behaviors/considerations], especially given your [seniority level/time with company]. For your role, the standard is [specific expectation]."
Create accountability: "How will you ensure this kind of oversight doesn't happen again? What support do you need from me? Let's check back in [timeframe] to see how you're applying this."

You may wish to document the discussion, their response, and your categorization for future reference, especially if this becomes a pattern. Go back and check out Hasting's email to Thiel as an example of someone doing this at a high level.

Making the Call

Poor judgment isn't just about being wrong—it's about consistently applying flawed thinking that creates risk for your organization. Poor judgment is about making bad decisions that someone really "should know better" than to make.

I hope this post helps you distinguish between the disagreements that make your company stronger and the judgment issues that require decisive action.

The goal isn't perfection.

It's ensuring that everyone on your team demonstrates thinking quality appropriate to their role and impact. Because in the end, judgment is what separates good employees from great ones, and great companies from failed ones.

Your job as a leader is determining the difference.