“Speed and Tempo” – Fearless Decision Making for Startups

”If things seem under control, you are just not going fast enough.”

- Mario Andretti

I was catching up over breakfast with a friend who’s now CEO of his own startup. One of the things he mentioned was that when it came to decision-making he still tended to think and act like an engineer. Each and every decision he made was carefully thought through and weighed. And he recognized it was making his startup feel and act like a big ponderous company. 74HGZA3MZ6SV

Speed = Execution Now

General George Patton said, “A good plan violently executed now is better than a perfect plan next week.” The same is true in your company. Most decisions in a startup must be made in the face of uncertainty. Since every situation is unique, there is no perfect solution to any engineering, customer or competitor problem, and you shouldn’t agonize over trying to find one. This doesn’t mean gambling the company’s fortunes on a whim. It means adopting plans with an acceptable degree of risk, and doing it quickly. (Make sure these are fact-based, not faith-based decisions.) In general, the company that consistently makes and implements decisions rapidly gains a tremendous, often decisive, competitive advantage.

Decision Making Heuristics for the Startup CEO

The heuristic I gave my friend was to think of decisions of having two states: those that are reversible and those that are irreversible. An example of a reversible decision could be adding a product feature, a new algorithm in the code, targeting a specific set of customers, etc. If the decision was a bad call you can unwind it in a reasonable period of time. An irreversible decision is firing an employee, launching your product, a five-year lease for an expensive new building, etc. These are usually difficult or impossible to reverse.

My advice was to start a policy of making reversible decisions before anyone left his office or before a meeting ended. In a startup it doesn’t matter if you’re 100% right 100% of the time. What matters is having forward momentum and a tight fact-based feedback loop (i.e. Customer Development) to help you quickly recognize and reverse any incorrect decisions. That’s why startups are agile. By the time a big company gets the committee to organize the subcommittee to pick a meeting date, your startup could have made 20 decisions, reversed five of them and implemented the fifteen that worked.

Tempo = Speed Consistently Over Time

Once you learn how to make decisions quickly you’re not done.  Startups that are agile have mastered one other trick – and that’s Tempo – the ability to make quick decisions consistently over extended periods of time.  Not just for the CEO or the exec staff, but for the entire company.  For a startup Speed and Tempo need to be an integral part of your corporate DNA.

Great startups have a tempo of 10x a large company.

Try it.

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22 Responses

  1. A post that would delight F.A. Hayek and Frank Knight.

    http://hayekcenter.org/?p=279

  2. So true. We perfectionists often forget that for reversible decisions good enough is often better than perfection. :>

  3. Steve,

    Have you seen Mike Cassidy’s excellent talk, “Speed as THE primary business strategy”?

    http://venturehacks.com/articles/speed

  4. “a tight fact-based feedback loop (i.e. Customer Development) to help you quickly recognize and reverse any incorrect decisions.”

    The importance of which cannot be underestimated – I’ve seen many companies making fast decisions, very few that measure the effects and adapt.

  5. [...] Blank: “Speed and Tempo” – Fearless Decision Making for Startups. Great startups have a tempo of 10x a large [...]

  6. [...] in Entrepreneur, VC, decision making. trackback Steve Blank had a great post last week about speed and tempo in startup decision making recently where he says: … think of decisions of having two states: those that are reversible [...]

  7. [...] 11:38 am on April 20, 2009 | 0 Permalink | Reply Good points about decision making by Steve [...]

  8. Great post, Steve. And nice site. It looks as though you and I have the same taste in layout, no? I’ve written about this subject many times and could not agree more. Too often, CEOs and small business managers suffer from analysis paralysis. This happens for any number of reasons. Some are afraid of making the wrong decision. Others feel it’s necessary to know ALL the variables before making a decision and executing. The problem is that you can check the pool’s thermostat all day long but you’re never going to know just how warm the pool is until you take the plunge.

    Would you be interested in guest posting?

    Jacob Webb
    Everyday Entrepreneurship

    http://everydayentrepreneurship.com

  9. Steve,

    Your Hueristics are at the core. I love the way you differentiate. Those things that aren’t irreversable not only allow you to “redo” but also allow you to benefit from the learnings that got you there. Sometimes, it’s the failures or mistakes that lead to the successess.

    Great post.

  10. [...] “Speed and Tempo” – Fearless Decision Making for Startups [...]

  11. [...] Blank wrote a pithy essay on how to navigate this decision making quandry and I love the quote he referenced from General Patton: “A good plan violently executed now is [...]

  12. [...] a recent blog post , Steve Blank, author of The Four Steps to the Epiphany” talked about reversible versus [...]

  13. [...] Blank provides another decision-making heuristic: Think of decisions of having two states: those that are reversible and those that are [...]

  14. [...] to see if they need to make a Pivot to find a better model. If they believe one is necessary, they do not hesitate to make the change. The search for a profitable and scalable business model might require a startup [...]

  15. [...] to see if they need to make a Pivot to find a better model. If they believe one is necessary, they do not hesitate to make the change. The search for a profitable and scalable business model might require a startup [...]

  16. [...] http://steveblank.com/2009/04/22…“Speed and Tempo” – Fearless Decision Making for Startups: http://steveblank.com/2009/04/10…Insert a dynamic date hereView All 0 CommentsCannot add comment at this time. Answers Pending [...]

  17. [...] Here, he talks about the kinds of decisions and why speed is important. [...]

  18. [...] way to think about premature scaling is as irreversible decisions. For example, it’s very hard to go back to your old burn rate once you’ve hired a VP [...]

  19. […] without a single person in charge, find that’s the fastest way to go out of business. Speed, tempo and fearless decision-making are a startups strategic advantage. More often than not, conditions on the ground will change so […]

  20. great read

    Came back from vacation thinking about slowing things down

    Now I am thinking about how to move faster!

    http://www.nokpis.com/2014/01/04/wow-where-did-2013-go/

    thanks for the post!

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