Decision making: high quality & high velocity
JC's Newsletter #195
Dear friends,
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In decision-making, speed often reigns supreme. Quality, without speed, leads to missed opportunities.
The adage “Good slow decisions don't exist. Only good fast decisions” encapsulates this idea. Slow decision-making often incurs high opportunity costs—lessons remain unlearned, and valuable insights are lost. The faster we move, the more we can learn, iterate, and improve.
As a result, your skill in decision-making is directly proportional to two things:
Your quality of information acquisition
The mental models you have of the world that help you digest quickly information
Let’s deep dive into the art and science of rapid yet high-quality decision-making.
The momentum of speed
Speed is a self-reinforcing cycle: the more you exhibit speed, the more feedback and interaction you receive, and the faster you grow and learn.
If you respond to people’s messages quickly, they send more messages. The sender learns to expect a response, because the projected cost of the exchange in their mind is low.
What’s true of individual people turns out also to be true of whole organisations. If contributors discover that you’re slow to merge pull requests, they’ll stop contributing. Unresponsive systems are sad, people don’t like to interact with them.
If you work quickly, the cost of doing something new will seem lower in your mind. So you’ll do more.
The contrary is true. If every time you write a blog post it takes you three months, you’re probably not going to think of starting a blog post, because it’ll feel too expensive.
Are speed & quality opposite?
The good news is that speed and quality are not the opposite. If you watch Formula One races and you look at the pit crews, they work really fast and with high precision. If they make a mistake, their team loses the race, and worse the driver could die.
Where do I start?
My experience has been to push myself to go faster than I believe it is healthy by timeboxing tasks and being intentional on producing high quality fast.
The first time, the result won’t be perfect, but I have understood what I can do.
Now, the task comes with less cost in my mind
I can decide to iterate more.
The more I do it, and repeat it, the better I get.
Eventually, I’m both fast and good.
I love this tip on writing from the writers of The Simpsons: “Since writing is very hard and rewriting is comparatively easy and rather fun, I always write my scripts all the way through as fast as I can.”
I think it applies to every topic. Go fast, then iterate, iterate, iterate.
Acquiring Information
The quality of your decisions is only as good as the information you base them on. That is why we built a culture of radical transparency where all information is accessible.
I suggest searching on Github, Slack & Notion to understand in-depth the context and the strategy of the company, or using Dust. User research and interviewing members/customers/stakeholders is also one of the important channels of information acquisition.
Sometimes, it is better to go slow at the beginning in order to go even faster. Spend the time reading the information, asking yourself questions that make sure you understand it well:
Why did we make this decision?
What is the company trying to achieve? What are we optimising for?
What is the right outcome of the work I’m doing? What are the expectations from stakeholders?
Those questions will help you sift through the noise, and learn to differentiate between what's crucial and what's not. Not all information is valuable.
Mental models
Expanding Your Mental Models
Mental models shape how we perceive the world. Expanding them can improve decision-making quality.
Not every model applies to all situations. Part of building a latticework of mental models is about educating yourself regarding which situations are best addressed by which models, and to apply them as fast as possible.
My way to increase my number of mental models:
Be exposed to business/product situations, and then spend time gathering my learnings on why it happened like it did.
To go really deep, you can use the Five Whys from Lean Methodology. Originating from Toyota's production system, the '5 Whys' technique involves asking 'Why?' five times to get to the root cause of a problem. By continually asking 'Why?' we can peel away the layers of symptoms and reach the core issue.
Reading: Books, articles, and case studies about other companies and situations, and try to make parallel with what I have experienced.
Perspective Shifting: Adopt different viewpoints, whether it's zooming out for a macro view or diving deep for details. Consider how different stakeholders might perceive a situation. Extend the timeline. What does this situation look like in the weeks, months, and years ahead?
Use the ones from physics/biology like relativity, reciprocity, inertia, velocity, leverage, activation energy, the law of minimum… and see how they apply to the business world.
Applying First Principles
At the end of the day, the most important mental model is to apply First Principles thinking.
First principles thinking involves breaking down complex problems into their fundamental truths and then rebuilding a solution from the ground up. It prevents us from making decisions based on assumptions or established beliefs.
Elon Musk used first principles thinking in the design and manufacturing of SpaceX rockets, breaking down the cost of components instead of accepting the industry's standard prices, leading to significantly reduced costs.
Conclusion
In summary, high-quality, fast decision-making requires proactively acquiring contextual information, filtering out noise, expanding mental models through diverse experiences and perspectives, and applying first principles thinking to break down problems. With practice, these skills allow rapid yet thoughtful decisions, creating a momentum where speed and quality reinforce each other.
Some articles I have read this week
👉 The 3-Person Unicorn Startup (NfX)
A great overview of why I’m pushing to collapse the talent stack
If you can have fewer people, every business operation gets easier, and as business elements get easier, you need even fewer people.
Fewer meetings, fewer disagreements, less politics, faster decision making, and faster experimentation.
Less recruiting, interviewing, hiring, onboarding, coaching, performance reviewing, culture building, dramatic departures and rings.
Not an excellent article overall but I agree with the 3-person view, and I think it is how we will end up building our crews.
👉 Modern Health (Contrary Research)
Key number on mental illness:
Should we name our program “Self guided therapy”?
I like how they differentiate the cases in the image (clinical therapy, psychiatry & medication management, mental health coaching, speciality coaching)
Group sessions like in Circles are smart
27% of all eligible members of customer organizations registered with Modern Health is an interesting data point
👉 Confidence and Vitality (Farnam Street)
When and how to have intuitions.
“People’s confidence in their intuition is not a good guide to their validity.”
“There are domains in which intuition can develop and others in which it cannot”
“Good domains have regularities that can be picked up by the limited human learning machine”
👉 Teladoc's Q2 beats Wall Street expectations
How Teladoc increased its gross margin: “improve therapist productivity, ranging from group sessions, group therapy sessions, to more digital interactions.”
👉 A Tweet from Nikita Bier (Twitter)
The smart builders aren’t making AI girlfriends. They’re using AI bots to seed a dating app until they reach a critical mass of users
👉 Clear Thinking (Farnam Street)
Pick the people you want to be surrounded by.
Few things are more important in life than avoiding the wrong people. It’s tempting to think that we are strong enough to avoid adopting the worst of others, but that’s not how it typically works.
We unconsciously become what we’re near.
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