Hey, what's up, Toby? We made it another week.
Yeah. Hey, happy Friday. That's right. We are
rocking and rolling today. I want to talk about
decision making. Oh, you got some decisions you
want to make? There's always lots of decisions.
More that I probably don't want to make. Right?
But that's part of it. Realizing how few decisions
you actually want to make. You know, for a second,
before we get into where you want to go, decision
fatigue, right? Oh, God. Yeah. Like, what's for
dinner? By that time of day, and it comes every
day, I'm kind of pooped out. And so there's a
myriad of decisions. So I'm kind of curious from,
you know, do I put on my pants before my shoes
to what's for dinner? Do I brush my teeth before
I fall in bed? What layer of decision making
are you thinking about? Yeah, I mean, I'm thinking
business decisions, right? So there's all the
anecdotes of like... Steve Jobs always only had
like one outfit. Right. Right. Or Brahma had
the one, you know, the one black suit or something.
Because they wanted to make sure that their decisions
were clear and clean. Totally. And I think the
reason why I want to talk about business decisions
is because they're just so hard to track after
the fact. I'm not talking like before the fact.
Sure. Yeah. But I'm talking like doing like retros
at the business decision level. And it wasn't
an effective decision is what you're asking.
How do we... Yeah. How do you know? Yeah. Yeah.
Is there an example of a decision that you've
been thinking about or maybe abstracted? But
I think it's a super interesting question because
I immediately go to most organizations today
are so short -term focused that... Yeah. It's,
did I keep my job at the quarterly earnings call?
Yeah, for sure. The best thought or the best
way that I've seen that enacted in a company
is I worked at an e -commerce company for a while,
in the purchasing department, and they actually
did... They looked for the mean absolute percentage
error on purchasing. And so what they did was
is they would figure out are the purchasing individual,
do they buy us high or buy us low on their purchasing.
And it was really cool. Like it was, it was,
it was like, it was done in a way that empowered
the team for them to have some self -awareness
around, hey, I know that when I purchase, I purchase
high or I purchase low because it's in, you know,
in inventory, it's always this balance of like,
well, you can have a hundred percent ship, you
can ship everything. Yeah. But that means that
you need to have infinite inventory, which finance
doesn't want. Right. So finance wants to keep
your stocks on hand really, really low. That
leads to stock outs. And so It was this really,
really good example in operations of tracking
people's decision -making based on their job.
And so that's kind of where I go when I think
about this. But then that leads to, oh, how is
this done at the strategic levels? Or how is
this done in our day -to -day jobs? Chris, what
I love about the example that you just shared
is that You also pointed at the natural tension
in the business between the actions of purchasing
who want infinite supply and the counterbalancing
tension that finance introduces, which is to
say, don't put all of our money into inventory.
And so that little bit of tension is really clear.
Individual purchasers probably weren't contemplating
that, but you were able to arrive at a point
of bias. It makes me think for our strategic
decisions, Where is that point of tension? You
know, there's, there has to be some natural limit.
And so too often strategic decisions with truly
strategic decisions are turning a battleship
of effort. Yeah. Oh, for sure. Rarely is it a
motorboat kind of action where it's like, you
know, jig left and then jig back to the right
area. Those are, they may feel strategic depending
on where you're at in the organization, but in
terms of shifting the outcomes of the overall,
it's a lot smaller. And so. I'm imagining when
you say strategic, you know, we might be time
out launching a new product line, a new partners.
Oh, for sure. And acquisition. How do we know
if that was the right choice? And what is that
natural tension that makes me think about like
the HP compact merger, you know, where a lot
of our listeners, they may be. What is that?
You know, battle of the battle of the printers.
It's, you know. Yeah. But we have a whole host
of these things that we often don't realize the
consequences of them because the knock on effect
is so nuanced. Yeah. Well, what's interesting,
the other thing that's interesting is like, I
think the challenge can become, it becomes this,
becomes a political problem, right? Which is
like, how am I as an individual assessing what
the strategy is and how do I apply that strategy?
to my area or not do it, because I think sometimes
we forget that not doing something is a decision
and oftentimes can be the right decision. Yeah.
Wow. We were talking earlier this week about
the scientific approach, you know, to publishing
and you made the comment that rarely is it a
solo act. It's usually a group of folks that
have collaborated to publish, you know, big pieces
of work. But there's an inherent bias in which
they're asking what's wrong with my theory And
yeah, and that's the lens that incremental peers
bring to it Which is totally counter to how the
corporate world works and to your point. It's
a political will Well, as opposed to a strong
Grounded theory. So yeah, so should maybe I'll
ask the question this way Like is testing of
a strategic decision. Are we testing it from
a political lens? Or are we trying to test it
from a validity and an effectiveness lens? From
a grow the business lens because sometimes it's
just it's antics on Wall Street and it puts our
name in the Headlines and our stock price goes
up, you know, yeah, what what kind of lens are
you thinking about? I mean, I think I think the
first thing that you have to do is you got to
make sure that you have a strategy I'm not even
trying to be flippant there. But like I think
sometimes strategy Coming up with a really solid
strategy, specifically one that's a year out,
is actually a lot harder than we think. And practically
what that looks like is what is, I always go
back to, there's a book on strategy that I read
that just talked about strategy is like having
a illness and having to go to a doctor where
there's a problem. There's a, you go to the doctor,
the doctor gives you an action plan, which is
like, this is what we're going to do. And then
there's an outcome of better health. And I think
most, I think sometimes people forget to just,
when it comes to strategy, just to think about
those, right? So the, and like what problems
are you solving for what people? What actions
or what directions are you going to take and
how are you going to resource them? Because it
does come down to you know, that's great like
you can have a strategy all you want But if you're
not resourcing it doesn't matter Right, or if
you're the other thing is like if you're gonna
have a strategy all day And if you don't know
what pain the people are in yeah Then you're
you're resourcing the wrong things Right if you
don't have someone who has control of you know
where those pieces go He was in you're gonna
be you're gonna be too thin. Yeah, right working
on too many things I love the piece you didn't
touch on that was inherent in your analogy, I
think, is you have an expert providing a diagnosis.
Yeah. And I will say that there's been a lot
of conversations where the role of the executive
is misunderstood. They should be having a bunch
of diagnosticians come in and opine from their
unique areas of expertise, right? But instead...
this idea of the superhero CEO, the all -knowing,
all -seeing one -man band, I think it's unfortunate
because we don't necessarily let senior executives
draw around them these experts that have developed
new ways of diagnosing or new ways of solutioning.
That raises a really interesting question. It
does make me think then in terms of how we understand
decision -making, is there even a framework?
You know, if we don't know the causal chain of
if this and that, it's really hard to know if
the remedy was effective. So I have a fever and
it plunged me in a nice bath and hold me under
water for two days. My temperature is going to
come down. I'll be dead, but they got the outcome.
One of the problems is like just raw accountability.
Yeah. And it's the time component that makes
it really difficult. Are you talking about the
resourcing element from a decision? Well, what
I'm just thinking of like the ability to hold
people accountable to their decision -making
means that there's a time component, which means
that you're going to have to go back in time
and you're going to have to determine what was
predicted based on that decision. I think the
biggest problem with that is if we go back in
time, we would instantly be faced with terrible
predictions that we make as human beings. For
sure. And probably the people that are the most
accurate are also the people that are providing
the longer timelines, which you don't have appetites
for. And so that ends up being this really kind
of counter -intuitive business logic, which is
hard things take a long time, and the appetite
for doing hard things, unless it's blended with
other long -term items, it's going to feel like,
what have you done for me lately? And so I have
a friend that just released a really cool outward
-facing, client -facing website, and I was like...
And they shared it this quarter. And I was like,
that is the coolest thing I've seen in a very
long time. And I'm like, how long did that take?
And they're like two to three years. I'm like,
yep. That's how long this time this stuff takes.
Right. Just because you've got it. You've got
to have the foresight to code it in a way that
you can get there. You, you have to balance all
the other things that are coming in and you have
to go in and and execute, and then you have to
go through all of the rigmarole of getting something
publicly facing, which means that you got to
make sure that all your stuff is API'd and pin
tested and all, or pin tested. You have to do
all those things. Like it is an immense amount
of work, and yet you can't have, you couldn't
have that expectation for every single quarter
for that team to land like that, because that
was such a huge effort. But among all of the
org, It would make sense that stuff like that
would start to fall if people are aligning towards
a strategy, which in that case has put abilities
into the client's hands. That's an interesting
example of something that is, and legitimately
great big enterprise, consumer facing websites.
There's so much going on in all the complexity.
I hadn't thought about that for a while. So at
first I thought two to three years and I thought,
okay, well, depending on what it is and the confidentiality,
that makes sense. Well, and a lot of it was not
necessarily the real calendar time. It's just
you have to have that direction, put a stake
in the ground. Any loose ends that you have or
extra time, extra cycles that you have in a sprint,
you would throw it towards that direction. And
so, a lot of it was being strategic, putting
those stakes in the ground, and then just marching
in that way, and it just happened to land. Now,
it took a lot of effort, but the calendar time
took more because it wasn't a direct, hey, we
should go do this now. Because if we were to
say, hey, let's go do this now, then maybe that
becomes a six -month project. Chris, you know
what it makes me think about? I worked in and
around the internal audit function years ago,
and there's a myriad of different ways that they
try to assess risk, and internal audit's job
is to understand is the business functioning
in a healthy and viable way, right? Are we meeting
all of the expectations that we've communicated
to the public, whether it's ethical obligations
or degree of risk, whatever the case is? Auditors
have a number of things that they'll review against.
Everything from what was the intention? Was there
a framework that was followed? Was there governance
process that decision had to pass through? The
question that raises for me, though, in light
of this one was, your friend just successfully
launched a website, two to three years of effort,
let's say it that way, manpower. Does that individual
now... Has their star risen by virtue of having
delivered on what they committed? Or did people
understand? I'm wondering if it matters to be.
Oh, no, no. That's really what's interesting
is this kind of goes back to a couple of episodes
ago. It's obvious after it's obvious. Right.
And so you basically know that this is the right
direction. Right you you basically make sure
that you're carving carving timeout every sprint
planning and then at the end You deliver this
and everybody's like, oh my gosh, this is so
great. And so it's the the the outcome and the
expectation is And the acceptance of how good
of an idea this was, was really kind of after
the fact. And so it's kind of like, in the absence
of an overarching kind of strategy, it's a lot
of people trying to figure out what the right
thing is for them politically, for their teams
politically. and really ultimately what everybody
wants up the chain. I'm with you. Let's bring
this back and put a bullseye on how this relates
to process, which I think is the idea that decisions
made without any kind of backcasting or confirmation,
retrospectively, how do we know if it's creating
problems or solving problems? What are some thoughts
that you might have around that? I mean, you
and I have talked a lot about different kinds
of decision bias. So being aware of that bias
is part of it. Yeah. I mean, I think a practical
one that CEOs use today is zero -based budgeting.
I think... Just to force them to be intentional
about resource allocation. It forces them to
think about their business. The challenge is
you just end up with... sharks and sheep, right?
Like you've got your people that are just basically
there to enhance their career, their career around
them. And that still doesn't change the bias
thing. But it is a good forcing function that
forces people to communicate what the expectations
are. I do think, you know, we've talked about
this a lot, just having a cohort. Like what's
your cohort? What are your constraints? because
you will end up finding out where the work needs
to be done. And if you're doing work, I don't
know if we've talked about Eli Goldratt's book
called The Goal, but it talks about constraints.
And he has a lot of, it's a story, but it's a
story on how if you fix constraints, then you
fix the system. And so I think if you're working
on something that's not a constraint, you're
not actually making, you essentially are building
process debt. That's interesting. Because you're
not making the system any better. Yep. So can
you explain, I guess the two qualifiers I heard
is, what does this decision do to shift existing
resources, zero -based budgeting, and then the
idea of constraint, are you addressing an existing
operational constraint? Yeah. Just a really binary
question. Are you making the system better? And
then the other one is just retros. Like if we
were forced to make a decision a month, or even
a decision a quarter, and just say, hey, when
do you expect this to be? We would probably all
end up in a deep depression because our predictions
are so terrible. That is interesting. Do you
think that decision making is like a muscle,
that it gets better the more often it's used?
Or do you think that it fatigues? I think it's
like practicing golf. You can go out to the range
and just swing a ball, but I guarantee you professionals
are not practicing that way. And so just because
you go out to the driving range and hit a ball
doesn't mean that your game is actually getting
better, because you're just basically taking
a crappy swing and just doing it more. Unless
you can turn it into a practice. And you can
measure decisions going in and decisions going
out. And I think what you would do, and we played
around with this a little bit with the cash flow
calculator, which is like, look, if you take
finances, whatever those are, and you put a prediction
on when the sales are going to come in and what
your operating expense are, and you track that,
and you see that over time, it forces people
to think slower. versus thinking fast, oftentimes
in meetings is just pushing the decision off.
Interesting. I don't know if we landed something.
I do think the coverage is around. Maybe we'll
come back to it in a future episode. I'm glad
we had the conversation though. It is a quandary.
It's hard, really hard. I do think that you're
either going to get significantly better with
GPTs and general of AI with your decision making,
or you're going to be forced to make more decisions
and do it just this same way over and over again.
I do think that those two will come together.
Chris, I guess the thought that I take away from
this is that idea of what is your perfect practice
as an individual? Yours, mine, whoever, right?
And if we're not intentional about how we come
at the practice of decision making, it's super
hard to know how you evaluate it. So that may
be the place to start. That is the start. Figure
out what decisions you're making and start with
yourself. And if you're a manager, start with
your people. Just don't do multiples. Like pick
one a quarter and see if that works. That's an
interesting exercise. Run your business as business
as usual for a day, for a week, for a month.
Yeah. Yeah. Let's see what happens and make it
better. All right. All right, sir. We made it
through another one. All righty. More to come.
Talk to you later. See you buddy.