Making Decisions — Transcript
[00:00:00.00] Ken: Decisions, when I started out, I would agonize over the smallest decision. You know, I mean, things that probably really didn’t matter in the long run. You know, should I give so and so a call and tell them I’m in business? Should I, you know, what form should the business take? And by that, I mean, you know, corporation or something like that, not recognizing there are tax implications of each one, but I would spend a lot of time analyzing these decisions, kind of not recognizing that over time, those decisions can be changed and they’re not a big deal. But on the other hand, I… Some decisions I made that I should have thought more about, such as going into business to begin with, I made effortlessly, and I just kind of wanted to point out that I was kind of bad at decision-making to begin with. Ultimately, I became more focused on what decisions I should agonize over and what I shouldn’t, but it was interesting that learning process was important, and the other thing is, as we’ve talked about in the past, we were all analysts, so it is very easy to get sucked down the analysis paralysis hole and analyze everything thinking you will someday have. of all the information you need to make a perfect decision, and I kind of came to the conclusion that that wasn’t going to happen, and the things that I found ended up being important decisions in our business were the personnel decisions, hiring and firing. Some administration. Administrative decisions, ultimately, as we got bigger and the tax consequences of the form of our business mattered more, you know, that kind of became a piece of it. So those rarely popped up, and the other big one, so personnel is a big one, and sales was the other one, you know, we’d be spending our time bidding on and trying to sell? How should projects be staffed? What services should we propose? Those ended up being the important decisions in the business. People and customers is basically what that amounts to, which I know is probably people are listening to this going, duh. You know, what else would you focus on? But as a bunch of analysts, like I said, we would overanalyze, you know, what should the letterhead look like? What should the, you know, how many pages should our executive summary be? We’d be people, have people wanting to make guidelines for those things, and ultimately I came to the conclusion that some decision is better than no decision. simply because lack of a decision created a void in the organization where people would just analyze and analyze and analyze, and even if the decisions, in my case, even if some of the decisions were bad, they were better than no decision, and about 80% of the time I was, you know, my decisions were good enough. to hang on to, you know, and that’s not a big deal when the other 20% get reversed later on. How about you? Did you ever have my angst about decisions or were they pretty easy for you in the business?
[00:03:39.56] Jim: No, I would say that, you know, I’m an analyst too. you’re an analyst, we worked with analysts, and so you want to weigh all the factors and make sure that you’ve got all the information. But on the other hand, I would argue that analysts are a bit of a pain in the butt, and a simple question like, “Where are we gonna eat lunch?” can generate more conversation. than is ever needed, and I completely agree with your conclusion that making a decision is the important thing, and even if it’s wrong, you can move on. It’s things become a mess if decisions aren’t being made, and an analogy that I could give you is, you know, late, late in life for me anyways, I was in my 50s, I think when a friend offered to teach me how to row a raft in a river in Idaho, and I knew nothing about it. about river hydraulics or that was even a topic worth learning or how to even talk about rowing a raft and then he taught me to the point that he was comfortable having me train people and make the decision whether or not they were going to work with him, and, you know, what I found was once you got somebody in a raft and we’re trying to train them, the people that couldn’t make a decision, and we’re talking simple decisions, Ken, river right or river left, you know, the ones that couldn’t make a decision that clamped. up, they never made it through. They were dangerous. Because if you saw somebody make a decision that was wrong, you could explain to them why it was wrong and why they would likely get hurt if they continued with it, and those people caught on quickly. But the ones that - and there are people out there - the people that either didn’t feel comfortable making a decision, they just didn’t belong in that situation. So I agree with you completely. Make the decision, you can always correct it later.
[00:06:15.46] Ken: - I think there’s something I learned and that’s a willingness to fail, and I know a lot of people, particularly the people we hired who were extraordinarily smart and bright and were always the one raising their hand in class, I’m sure, you know, in high school, and had the right answer, almost had an indecision about them if they didn’t have an answer. particularly around the, you know, the personnel and the sales, those kinds of decisions I mentioned earlier. There is no clear right answer. You know, you can’t say, you know, George Washington, you know, because the questions are not who, the questions are not fact-based. There is much instinct, or the answers, the decisions have to be made as much on instinct as fact, and I think that created a problem with decision making for a lot of people, and it did for me for a long time. I had to overcome that and recognize that it’s not always about the facts. I will add a nuance to what you said. Decisions have to be made in a timely manner. manner or they do suck up a lot of resources. You know, people will not let go. But there also has to be buy-in for some decisions. So like the personnel decision, we talked in another podcast about how we made decisions about personnel and hiring, and that was basically by placing the responsibility for that on the individuals that the new hire would be working with. So those, you know, those were some nuances, but to me, it came down to a willingness to fail. You know, I always said I could be wrong. It would always kill, it always cracked me up ‘cause there were a bunch of tools that people would try and bring to me and say, oh, use this Eisenhower, It’ll help you make decisions and when, and maybe a little, but people would try and substitute tools or methods for just saying, look, this is what I know. This is what my gut is telling me. This is my history. and just pull the trigger, again, with the understanding that you’re only gonna be right about 80% of the time. Now, in baseball, that would be an amazing batting average, wouldn’t it, 800? But, you know, and in business, I think that’s pretty good. I think a 50/50 call on, you know, making the right decision, and sometimes it wasn’t always so much that the right decision was made, it was just that a decision. was made, a direction was chosen. Was it the optimal decision? I don’t know, ‘cause I didn’t have the opportunity to go back and make a different decision or a different choice, but yeah. So again, you know, growth as an entrepreneur, not all decisions worked out, but a lot of decisions didn’t work out.
[00:09:24.91] Jim: a lot of them dead, and it’s better
[00:09:26.02] Ken: to have some decision than none.
[00:09:27.51] Jim: - I’m gonna latch on to one of the things that you said through that, and that is that there isn’t just one good decision. I think the secret to this is there are lots of good decisions, and I know when I got stuck, sort of dead in the water, were the times that I was thinking I’m going to find the optimal decision, or the very best.
[00:10:00.25] Ken: Sometimes the way to think about it is try not to make a bad decision, you know, if you If some of them or if two of them are obviously bad go with one of the other three, you know
[00:10:12.89] Jim: Yeah