Decide fast and break shit

John J. Schaub 

Feb 6 , 2023 

In March I will be giving a talk on Decision Making in Product Management at ProductCamp Vancouver. As part of preparing for the talk I will be writing a few posts on some of the lesser understood aspects of decision making. This post will be on the wildly misunderstood topic of optimal decision making speed and why it is so difficult for individuals and companies to change the way they approach decisions and how you as a leader can at least try to address that.

Before diving in let's get some fundamentals out of the way. The core fact to understand is that decision making speed is driven almost entirely by your willingness to accept ambiguity. Yes you can get better at collecting and processing data faster but those are incremental improvements that while valuable will not move the needle in a significant way. If you want to really move the needle and make decisions significantly faster you need to get comfortable with accepting more ambiguity. The takeaway here is that decision making is in effect an exercise in risk tolerance and more risk equals moving faster. 

The startup world where I currently work is obsessed with speed and for good reason. The idea of taking your time to analyse a decision and avoid errors is almost considered a character flaw and the adage 'Move Fast and Break Shit' is oft repeated. What people who operate in this environment often miss is that their notions of the optimal approach to decision making are very much a product of the context they have been operating in and might be the exact wrong thing to do in a different context. This sort of understanding of context dependant optimal behaviours is why experience is so valuable as you tend to only learn these things after a few trips though the business cycle. Given the recent turmoil in the tech industry and the shutting of the free money faucet the startup world is seeing a very clear change in context so I thought this topic was worth looking at.

The 'move fast and break shit' ideology came about in an extraordinarily reward rich and rapidly changing environment. In this sort of chaotic greenfield the benefits for a company of moving quickly and arriving first at a  new market vastly outweigh the negative costs of occasional or even frequent mistakes. Further the fact that the environment is rapidly changing means that there was little to be gained from long term plans. In such an environment the fast companies grow rapidly and can eventually overwhelm the slower more careful companies. On an individual level the staff of the fast moving companies quickly advance and even if their company fails they can quickly move to a new company and start the process over. In such an environment 'Move fast and break shit' or put more politely accept lots of risk is the optimal approach. But when the variables change the optimal behavior changes along side and it is important to do a quick rethink on your approach when the underlying variables are shifting quickly.

In a more stable environment with less frequent, less valuable rewards it is actually the slower more careful companies that will survive longer and out compete the fast movers who will quickly starve themselves of resources and die off. If you think of the change as going from a lush field to an arid desert and imagine the sorts of animals that thrive in each environment you will not be far off the mark. Quickly making this change from fast moving to deep thinking culture is going to be vital for companies and individuals in the next year or so but even more important will be maintaining the cultural flexibility to change back again when the environment gets more favorable to growth. Turning your company into a paranoid, scrooge like tortious is a great way to survive a downturn but once the good times return you need to have preserved enough of the fast moving culture to change back or you will be left behind. 

Before we get to changing back though let's talk about why is it so hard for companies to change their approach to decisions in the first place. It is pretty apparent to anyone paying attention that we have went from an environment of near 0% interest rates to one much more in line with historic norms and you do not need a degree in economics to know that means that investment and spending will be curtailed. So clearly the game has changed and the optimal way to play it will have changed as well, explaining this to people is not difficult. But we know from a myriad of historic examples that companies that have failed to navigate such changes in the environment that this is not easy. The reason it is not easy comes down to fundamental human factors.  There is a fantastic quote from Napoleon "To understand a man one has to know what was happening in the world when he was twenty". Napoleon had a very advanced understanding of human nature and was spot on with this one. 

Human beings tend to have built in tendencies toward things like risk and ambiguity that form fairly early in life and are very hard to change. Some would say impossible but I try to be an optimist. Getting one person to fundamentally change their mindset is hard, getting dozens or even hundreds to do some simultaneously is really hard, bordering on impossible. The cynical approach would be to simply swap the people and bring in people whose mindset is more suited to the environment that you are currently operating in. For certain key roles this is actually a very common approach and you will notice a rejig at the executive level of any company going through a major environment shift but for any significant number of roles this sort of model is just not tenable. You are going to need to make things work with the people you have.

So rather than try to change the fundamental mindset of hundreds of people you need to restructure the organizations decision making process to adapt to the changing circumstances. The analogue I would use here is changing the software rather than the hardware. For example in computing there are some classes of problems that are much more effectively handled by a GPU as opposed to a CPU, routing the problems accordingly is a software work around to a hardware limitation. With this in mind rather than trying to change or replace your staff you need to change the process they use to make decisions and effectively route the problems according to the level of risk you as an organization are willing to accept. How this looks in practical terms is that in a greenfield environment flat structures with high levels of autonomy for junior staff are the norm, in more desert like environments strict hierarchies with multiple layers of approval become the norm. 

As much as some thought leaders love to claim that the flat highly autonomous structure is simply superior the reality is that both structures have an environment in which they are optimal. I will restate this point in more basic terms because it is absolutely vital - there is no such thing as a best approach to decision making, there is only an optimal approach for a given environment. As organizations come to terms with the fact that the environment has changed they will start to evolve toward whichever model is more optimal at the given time. As a staff member it behooves you to understand the environment your company is operating in and why a given model might be the order of the day when only a few years ago there was a rather different approach being taken. As a leader your job is to understand that this too shall pass and ensure that your organization remains flexible enough to adjust back to a faster moving more risk taking org when that approach inevitably becomes the more optimal one in the next few years.

If you are struggling with these sorts of changes drop me a line. Leading this sort of change is not something I do but I know some great consultants that do.