Leadership Judgement Series – Part Ten
Active listening improves leadership judgement because it helps leaders understand what people are really trying to tell them before deciding what to do about it.
Imagine a business approaching a significant product launch.
The launch is part of its annual customer event at a major venue. Advertising has been booked across outdoor, radio and television. Customers, partners and the wider market are expecting an announcement, and substantial commercial commitments depend on the date being met.
An operational leader tells the CEO that they are becoming increasingly uncomfortable about delivery readiness.
The CEO starts asking questions.
What exactly will not be ready? Which elements are creating the greatest concern? Is the problem one of resources, supplier performance, technical reliability or something more fundamental? What would need to change for the operational team to support the launch with confidence?
Those are not the questions of a leader who has failed to listen. They are the questions many experienced leaders would reasonably ask. The operational leader sees delivery risk that the CEO needs to understand. The CEO may see commercial, customer and reputational consequences that the operational leader does not fully appreciate.
Active listening requires both realities to enter the conversation.
The CEO may conclude that postponing the launch would cause greater damage than proceeding. The event, advertising and customer commitments cannot simply be moved without considerable cost. A carefully managed launch may therefore need to go ahead even if some of what sits behind it is less complete than anyone would ideally want.
However, listening properly should still affect what happens next.
The CEO might bring in additional expertise, escalate a supplier issue, reduce the initial scope, separate what must be genuinely operational from what can be demonstrated, strengthen the contingency plan or personally remove obstacles preventing the team from delivering.
Just as importantly, they should explain the wider commercial context to the operational leader. The decision is not simply, “We are launching because I said so.” It becomes, “I understand the risks you have identified. Here is why the date still matters, here is what we are going to do about those risks, and here is where I need your help.”
The operational leader may not get the decision they initially wanted. They should nevertheless be able to see that their concerns were understood, influenced the plan and received a serious response.
That is the important distinction.
Active listening does not require a leader to accept another person’s conclusion. It requires them to understand the evidence and perspective behind it well enough to make a better-informed judgement.
Poor listening in this situation would not necessarily be protecting the launch date. It would be assuming that the operational leader was merely being cautious, answering the concern before understanding its cause, or proceeding without allowing what they knew to influence the plan.
Leadership judgement depends on hearing the operational reality, setting it alongside the wider commercial reality and finding the best available way through.
Active Listening Is More Than a Communication Courtesy
Active listening is usually described as an interpersonal skill: paying attention, avoiding interruption, asking questions, reflecting what somebody has said and demonstrating empathy. Those behaviours matter. Leaders who routinely talk over people or spend conversations waiting for their own turn to speak are unlikely to understand much beyond what they already know.
Leadership judgement, however, requires something more.
The important question is whether listening allows a leader to understand something they might otherwise have misunderstood, filtered out or explained away. That makes active listening part of the organisation’s information system. It affects how leadership understands its people, customers, operations and markets before making decisions that must work across all four.
A 2024 systematic review and meta-analysis of workplace listening, covering 664 effect sizes and more than 400,000 observations, found strong associations between perceived listening and workplace outcomes, particularly relationship quality. It also identified meaningful links with cognition and performance.
Listening matters at work partly because it improves relationships, but also because it can improve the quality of the thinking taking place within them.
Interpretation Can Overtake Understanding
Experienced leaders cannot switch off their experience every time somebody speaks to them, nor should they.
As an employee, customer or colleague describes a problem, an experienced leader’s mind naturally begins making connections:
- I have seen this before.
- That sounds like an execution issue.
- We tried something similar three years ago.
- Finance will never approve that.
- That customer always pushes on price.
Pattern recognition is one of the benefits of experience. It allows leaders to process complexity more quickly and avoid rediscovering everything from first principles.
The risk arises when recognising a familiar pattern causes the leader to reach a conclusion before the other person has finished describing what they see. Asking questions does not, by itself, demonstrate good listening. A leader can ask sensible questions and still listen badly if every question assumes their original interpretation is correct.
Good Listening Can Improve the Information Itself
Leadership conversations are not always straightforward transfers of fully formed information. People often recognise that something has changed before they can explain precisely what lies behind it.
A salesperson might say that customers seem less interested than they used to be. That could indicate weaker selling, deteriorating demand, pricing pressure, new competition or several other possibilities.
A leader who moves quickly to diagnosis may select one explanation and begin responding to it. A better conversation stays with the original observation for longer.
Which customers are behaving differently? When did this begin? What has changed in the conversations? Are existing customers behaving in the same way as new prospects?
The answers may reveal that existing customers remain engaged, but new prospects with no established relationship are struggling to see enough differentiation to justify changing supplier.
That is a much more useful commercial insight.
The salesperson may not have arrived with that conclusion already formed. It emerged because the conversation created enough space to examine what they were observing before deciding what it meant.
Active listening therefore does more than extract information. It can help two people develop a better understanding than either had at the beginning of the conversation.
Listening to Customers Goes Beyond Collecting Feedback
Businesses can collect large amounts of customer feedback without doing much active listening.
Satisfaction measures, surveys, CRM notes, support tickets, account reviews, win/loss analysis and renewal data all have value. Their limitation is that much of the information has already been shaped by the organisation’s own questions, systems and categories.
A satisfaction survey asks customers about something the business has decided is worth measuring. An account review usually follows an agenda created by the supplier. A CRM system may require somebody to select a reason for a loss from a predetermined list.
That structure makes information easier to capture and compare, but it also narrows what the organisation is likely to hear.
A customer may be satisfied with the service while believing that the reason they originally chose the supplier is becoming less important. They may show little interest in additional product features because their real frustration lies in how difficult the buying process has become internally.
Even renewal can be misleading. A strategic customer may be likely to stay because changing supplier this year would create too much disruption, not because the relationship is particularly strong.
These are materially different commercial realities. They are unlikely to emerge when customers are only asked to score an experience the organisation has already defined for them.
Customer feedback tells a business what customers think about the questions it has chosen to ask. Active listening creates the possibility of learning something it had not thought to ask about.
Strategic Customers Require Deeper Understanding
Not every customer relationship requires the same depth of leadership attention.
Organisations rightly concentrate more time where relationships have disproportionate importance to revenue, margin, learning, growth or strategic position. If an account features prominently in the organisation’s growth plans, leadership should understand more than its current revenue, renewal probability, pipeline and satisfaction score.
It should also understand:
- What is changing inside the customer’s organisation?
- What is its leadership team trying to achieve?
- Why does the customer genuinely choose us?
- Which people increasingly influence that choice?
- Where does doing business with us create friction?
- What value does the customer believe we provide?
- How might the relationship develop before either side has translated that potential into a formal opportunity?
Senior executives do not need to bypass account managers or take personal ownership of every strategic relationship. They should, however, recognise the limitations of relying entirely on information that has already travelled through their own organisational structures.
Research into long-term B2B relationships supports the importance of keeping those relationships open to learning. A 2023 open-access study identified communication openness and the ability to anticipate changing customer value among the mechanisms through which suppliers manage B2B relationships as economic conditions change.
If a customer is important enough to feature in the growth plan, it is important enough for leadership to understand properly.
Active Listening Helps Leaders Put on Their Customer Spectacles
Customer Spectacles asks an organisation to change its vantage point deliberately:
What does this business look like from where the customer is standing?
Active listening helps leadership remain in that position long enough to understand it.
It does not mean asking customers what they want and automatically doing it. Customers are not responsible for the supplier’s profitability, capabilities, investment priorities, other relationships or wider strategy.
Those judgements remain with leadership.
The purpose of listening is to understand the customer’s reality before deciding what that reality means for the business. Customer perspective should influence leadership judgement, not replace it.
A customer does not have to be right about the answer to possess information the supplier needs to hear.
Listening Is Hardest When Somebody Disagrees
Listening is relatively easy when what we hear supports what we already believe. The greater test comes when somebody challenges the current view.
- “I don’t think customers value this as much as we believe.”
- “I don’t think this acquisition is integrating successfully.”
- “The transformation isn’t simply behind schedule. I think the design itself is wrong.”
- “The account is renewing, but I’m no longer convinced the relationship is healthy.”
A leader now has two tasks: understand the challenge and decide whether it is correct.
They need to happen in that order.
In practice, evaluation often starts immediately. The leader begins assembling counter-evidence, supplying missing context or explaining why the concern may not be as significant as the speaker believes.
That response may ultimately be justified. The danger lies in reaching it without first understanding the strongest version of the challenge.
A 2024 experimental study, conducted across four experiments, found that high-quality listening during disagreement reduced defensiveness and encouraged greater self-reflection by the speaker. Listening did not require agreement. Its value came from creating the conditions in which a position could be examined more openly.
This is particularly important within leadership teams because disagreement often reflects incomplete perspectives.
The CFO may understand something the commercial director cannot see. The commercial director may know something the data does not yet show. Operations may recognise an execution constraint that strategy has underestimated.
No individual perspective needs to be wholly correct for it to contain something the eventual decision needs.
Every Response Shapes What Leadership Hears Next Time
An employee raises an early concern with their MD. The MD listens politely, asks questions and then explains why the issue is unlikely to be significant.
Nobody is criticised and the conversation may feel perfectly reasonable.
Six weeks later, a similar concern appears. The employee raises it again and receives another competent explanation.
Eventually, the employee learns what happens to this kind of information. They may still speak up when the evidence becomes undeniable, but become less willing to raise the next early, uncertain signal.
Customers learn in the same way.
A strategic customer raises a concern several times and repeatedly receives an explanation of why the supplier’s current approach makes sense. Eventually, they stop mentioning it.
The concern may not have disappeared. The customer has simply concluded that raising it achieves very little.
A 2025 open-access review of employee voice describes how speaking up creates consequences for the speaker, managers and colleagues, and how those reactions influence later behaviour.
Every leadership response helps teach people what is worth saying next time.
This has consequences beyond workplace culture. It affects the quality of the information available to leadership. An organisation can gradually become easier to manage because fewer uncertain, awkward or contradictory signals make their way upwards. At the same time, it becomes harder to understand.
Seniority Changes What People Say
People prepare before speaking to senior leaders.
An account director going into a CEO meeting will have thought carefully about what to say. A middle manager reporting a serious operational issue will usually try to understand the causes first. People simplify complexity, anticipate likely questions and often arrive with a proposed solution.
Much of that preparation is useful. Senior leaders need information to be organised.
But organisation can also remove important detail. Uncertainty is polished away. Early impressions become more definite. Conflicting evidence is reconciled into a single narrative. A complex customer account becomes red, amber or green.
By the time information reaches the top of the organisation, some of the ambiguity that might have prompted curiosity has disappeared.
The same effect occurs in strategic customer relationships. Account teams understandably brief senior leaders before executive meetings, explaining the customer’s priorities, political dynamics, outstanding issues and the desired outcome.
That preparation can shape what the executive expects to hear before the customer has said anything.
Senior leaders occasionally need to create room for the less polished version:
- How confident are we about that?
- What are you least comfortable with?
- What would you tell me if you did not also feel obliged to bring me the solution?
- What might we be explaining away too quickly?
Senior leaders rarely lack people willing to speak to them. The greater risk is that people increasingly speak in ways shaped by what they believe leadership wants to hear.
Listening Does Not Mean Handing Over the Decision
A leader can listen carefully and still decide not to act on what they have heard.
A strategic customer may want something that is uneconomic to deliver. A salesperson may prioritise winning a major deal over maintaining a coherent proposition. An operational leader may see delivery risk that the wider organisation can reasonably choose to absorb.
Listening does not make every perspective equally decisive.
Different people see different parts of reality. Leadership must combine those perspectives with evidence, economics, capability, risk and strategic priorities.
The test is not whether the speaker gets their way. It is whether what they know receives a fair opportunity to influence what leadership understands.
There is nothing inconsistent about listening well and then saying no. The difference is that the decision follows understanding rather than replacing it.
Listen for What Does Not Fit
Most information reaching leadership fits the organisation’s existing view of itself. Most customers behave in broadly predictable ways, operational activity follows familiar patterns and sales opportunities can be categorised using previous experience.
The potentially important signal is sometimes the one that does not fit:
- A customer suddenly involves a stakeholder the supplier has never encountered.
- An experienced salesperson struggles to explain why apparently strong opportunities feel less secure.
- A delivery team repeatedly encounters an exception to a process that has worked for years.
- A long-standing strategic customer remains positive while behaving as though its priorities are changing.
Any one of these may mean nothing. Active listening does not require leadership to turn every anomaly into a strategic issue.
It does require unfamiliar information to be understood before it is dismissed.
Business reality often changes before the measures used to describe it. Sometimes somebody notices the difference before the data can prove it.
Leadership has to be willing to hear them.
Five Questions for Better Leadership Listening
Better listening does not require another model. It requires enough discipline to notice when interpretation is overtaking understanding.
Five questions can help.
1. What is this person actually trying to tell me?
Look beyond the literal words. What is the underlying observation, concern or implication?
2. What am I already assuming about what they mean?
Have I labelled this too quickly as resistance, poor execution, a customer complaint, commercial negotiation or lack of confidence?
3. What have I not understood well enough yet?
Would one more genuine question improve the quality of the information more than an immediate answer?
4. What could I hear that would change my current view?
If the honest answer is nothing, the conversation may be collecting information without allowing it to influence judgement.
5. What have I taught this person about what they should tell me next time?
Has my response made an early, uncertain or uncomfortable signal more or less likely to reach leadership in future?
These questions apply whether the person across the table is the COO, a new employee or the organisation’s largest strategic customer.
Active Listening Keeps Leadership Judgement Connected to Reality
Leadership judgement depends on evidence, challenge, perspective and an understanding of current business reality.
Much of that reaches senior leaders through other people: customers, executives, employees, account teams, partners, advisers and those working closer to delivery or the market.
Active listening is therefore not an interpersonal skill sitting alongside leadership judgement. It is one of the ways judgement remains connected to things the leader cannot see directly.
Its quality is not demonstrated by whether a leader can repeat what somebody said. It is demonstrated by whether they understood it well enough to give it a genuine opportunity to change what they think.
Before the next important conversation with a colleague, employee or strategic customer, one question is worth carrying into the room:
What are people trying to tell us that we may be hearing clearly but interpreting too quickly?
Next in the Leadership Judgement Series
How Leadership Humility Improves Business Decisions
Active listening requires more than technique.
A leader can ask good questions, create room for challenge and hear customers and colleagues clearly, yet still struggle to let another perspective alter their judgement if doing so feels like diminishing their own expertise or authority.
In Part Eleven, we examine leadership humility not as modesty, weakness or lack of confidence, but as the ability to recognise where the limits of our own knowledge begin.ity to understand where the limits of our own knowledge begin.