Speaker 1what's up guys welcome back to build and today i want to talk about one of the most underrated skills in business which is decision making and i think it's underrated because i don't really think you get a lot of views if you talk about it uh this video probably won't but it is absolutely one of the most underrated skills in business right now it was top of mind for me this week because i had a bunch of different business leaders come to me and they're like hey like what are you doing about ai like how are you using it tell me how much time you're investing in it and i know how to use ai i have tons of people on the team using ai we're ai first company we just did an entire initiative this quarter but do i think me learning how to vibe code is like the best use of my time the answer is actually no and the reason for that is i believe that me making good decisions is the best use of my time now can ai help me make better decisions i would say yes there's a lot of instances where you know i need to research things i need to get facts i need to look at averages of companies and do all sorts of stuff that using ai can help me get ahead on making a better decision now i want to make the argument for why this is an underrated skill in business because time and time again i will be on here on this podcast preaching to you all of these skills that i don't think anyone gives a fuck about but are definitely the most important things for growing a company so the reason why i did this is because i think it's really important decision making is so important in a company is that the power of a decision comes from the four multipliers that kind of contribute to it and i i wrote this down because i think it's important and i want you guys to understand okay so the first one is that when you make a decision right why do you have so much leverage from a decision as a leader is because of the reach okay so reach is how many people can execute this decision without you so your own effort doing something for yourself working for yourself coding something from yourself reaches you if you make a really good decision how much reach does that get in your organization through your client base through your community to the people who follow you so by making a specific hiring decision or a pricing decision or a marketplace position or a product decision you essentially get to see that that decision affects and reaches all these people beyond you now kenny i help you do that for sure but that's kind of not the point of this video the point is that that is one reason why decisions get you so much leverage is the reach that decision has now here's the next one repetitions okay so repetition you make a decision how many people now can repeat that framework know that you made that decision now they can repeat that decision on your behalf in your organization and they can repeat that decision on your behalf in your organization your client base and your following after you so essentially you do all this work to make the decision one time now every time someone faces a situation that's similar to that they can apply that decision making process and make good decisions on your behalf right so essentially you're modeling it for other people in the organization so reach it's like you make this one decision it affects all these people if you think about somebody has the most reach in this entire organization it affects all these people it affects all these people it affects all these people in the entire world you would look at world leaders right they make a decision and it affects the whole country countries the world right if you look at a leader of a company a large organization they make one decision it can either positively or negatively affect all the people on that team or that follow that company that buy products from that company and we've seen some good decisions we've seen some bad decisions right like i would say um for example like i used to love lululemon whoever bought that company they made the decision to downgrade the quality of the clothing i haven't bought it since it affected me right that's reach so think about the reach you have from decision second the repetition now when you make your decision how many people can now make that same take that framework and make the same similar decision in a similar situation on your behalf all of your employee base all of your leaders clients that watch you and want to see the demonstration of excellence your audience so a good example of this is about two and a half years ago um we had we'd hired like 10 new leaders in like six months because we were growing really really fast i think this is when we were going from like 30 to 75 people and we needed to like get the leaders and managers and departments build out another layered leadership and there was two people who like clearly when i met with them and talked to them i was like these people i don't want them on my team like they're not nice they don't treat people nice like i can tell that they have ulterior motives like i could say whatever i want i didn't tell the team i'm like they do not fit our culture here's why they clearly don't want it's best for the team all these reasons so i fired them and then i made the post and told my team why i did that i said i'm upholding the culture nothing is more important i don't care what results you've got what resume you've got what fucking company you came from if you don't uphold our culture then you don't have a job here you certainly don't have a job as a leader i can't tell you how many times i watched that decision get repeated in my company it was like singularly one day i was like oh my god i'm gonna be a leader i'm gonna be a leader i'm gonna be a leader i'm gonna be one of the best decisions i've made because i got to watch all these other leaders who were less experienced repeat that and when i'd say well why shouldn't that person be on this team look they're not a culture fit look what they did to this person look how they treated this person look how they treated this guest so you think about the decisions you make you are setting the tone for the organization you're modeling behavior for everybody else so that's again the second reason why decision making is so powerful in an organization now the next one is the is duration when you do work every day like i'm making a podcast right now maybe i write an email maybe i respond to people maybe i i don't know do something have a conversation how long does that last like what's the duration of the impact that i'm having in the organization it's low when you make a decision the duration of impact a decision on the positioning of your business in the marketplace if you're taking on investors or not if you're doing an investment or not if you're doing a deal or not if you're partnering with this person or not you're hiring this person or not that decision right the duration of it stays in force far beyond what you do today so again you have reach you have repetition and you have duration which is i do one thing today i make a decision today and i get to see that continue to play out for how long it continues to get executed the decision gets executed on time and time and time again and the bigger decisions that are that you make the more work that gets executed on your behalf without you being there for a longer period of time so like a good example of this would be um you know when i make a decision about a partnership or an investment in our company like we want to invest in this company we want to buy a company we want to partner with a company that decision is insanely important because we want to make a decision about a partnership or an investment in our company that is going to uh last for a very long time right and so we have some that have been great in terms of duration like it's been years of an amazing partnership and amazing acquisition that we've made and then we have some where i've said oh my gosh that was terrible and i've actually lost time on that so it can work in both directions but you have to think about like how much that compounds over time because you don't have to revisit it it's a decision you make one time that continues to make dividends for you which like literally if you're making investments like it actually makes dividends for you right and so for us we have acquisition.com uh acquisition re which is a real estate arm and we make decisions essentially myself with two others about what properties we're going to invest in you make that decision one time and it literally pays you money for years and years to come that's a good place to spend my time so those are the three positives of making a decision like you get all these things now i would say the one piece you have to think about is reversibility which is essentially like the tax on decision making which is things that are easy to reverse rarely ever need much thought put into them in fact i don't think like you should spend a ton of time thinking about something that's easily irreversible i'm much more of the mind of you should test it you should try it you should dip your toe in it whatever um but i would say that a lot of the things that are easy to reverse are things that a lot of leadership decisions are load-bearing there's a lot that is riding on them there's a lot that could happen that's good or bad based on you making them so the harder a decision is to unwind the more the initial multipliers matter because the cost of being wrong is all of those things in the wrong direction which is you now are enduring a long period of time that you are seeing out a bad decision you are having people repeat in the organization or that follow you or that are your customers a decision that you made that is incorrect and it actually just compounds it and you um you know essentially reach in many ways people negatively so you have a negative impact so if you think about making one wrong decision organization you know over the last year and a half you've seen a ton of layoffs in huge companies you've seen a ton of product pivots you see a ton of people try to go ai first that's that have failed those are all decisions that were hard to reverse and arguably bad decisions. So that's why I think decision making is like one of the most underrated skills in a company. I will also tell you like, this is one of my favorite things to do. Like making big decisions is where I feel very comfortable. It's because I spent a lot of time thinking through the impact of the decisions, what it means to make a decision and how important they are for the company. Now, if we're thinking about making a decision, I think the difficulty is like once you know this and you're like, okay, I understand how much leverage comes from making decisions. Then you start to get in your head about it. You're like, oh, fuck, I don't want to do this because you're like, wow, there's a lot that could go wrong. And so a lot of people just end up not making decisions and living their life or running their business in a way that is passive. They think, okay, well, I just don't want to make those decisions because it makes me uncomfortable to some degree. And if you look at like the best founders, the best CEOs, the best leaders, like they attack these things head on. I am constantly, like I will tell you this, like constantly looking for what's wrong. I am looking for decisions I need to make because I understand that an unmade decision is a huge part of the decision making process. And I think that's a huge area of risk in my company. And a lot of the times people don't surface them unless you're kind of looking and digging and poking around because they themselves don't really want to make them. And they're trying to avoid the fact that you do. And they also kind of don't know what it means for them in many of the situations. So some ways to kind of deescalate this for yourself, because I think like talking about this, it can put a lot of pressure on somebody. I understand. It's like, fuck, I don't want to make the wrong decision. The first one is that you don't want to have, a absolute mentality about this. It is not all or nothing. And I think that, you know, in going through the formula, obviously it feels that way, but like seldom is anything black or white in life. It's not like an either or mentality. When somebody, for example, brings me an option, like, should we keep them or should we fire them? There are so many other doors that we could enter. Do we coach them? Do we put them in a different role? Do we change their boss? Do we give them a mentor? Do we like, there are so many other options, but oftentimes what you'll see is that, especially when you're running a company, people come to you with these either or decisions. And I think the first job and skill in decision making is to realize that most of the time, the first thing that you want to do is create more options. So when I'm presented with a decision, it's like, should we do this for the product or this? And I'm like, why not this over here? Why is this not an option? So I think that one of the main things a leader can do that adds value to the company is create options. The more options you have, the more likely it is that you're going to make a decision that is best for the company, best for the team, best for the clients, best for the community. It's a win-win-win for everybody. And you're going to avoid a lot of the downside of decision making. But I think it comes down to, like, you have to be able to actually do that. So that's the first one is like, you need to be able to create options. And I think part of that comes down to like, there's very logical decision making. I think people think, you know, we're making decisions like this, but like, you need to think creatively. You need to get creative. You need to think about what you're doing. You need to all the different ways that you could solve this problem. Like, in an ideal world, if this could be perfect for you, if this could go perfectly, what would the outcome be? What would you do? What would it look like? And a lot of times when you think that way, and you're a little bit more like having fun with it, you actually come up with like way better things, way better ideas. Another way I ask myself this is, I'm like, okay, if I were starting over with this situation, what would I do? I think that unlocks because oftentimes we have the sunk cost of, okay, well, if I have to do this, change all this stuff. Oh my God, that's so much stuff to undo or to go back on or whatever it might be. And people are really scared of that. And so because of that, they don't even entertain some of the options that exist. So for me, if you ask yourself, hey, if I were starting from scratch, would I do this thing? Would I go this direction? Would I hire this person? That's a great question to ask, because I think it gets a really honest answer. Now, the second thing that I would say is like a skill of decision making is deadlines. Ha, deadlines. Decisions do not get easier with time. They don't get better with time. Like there's this fallacy that the more time you spend thinking about it, the better of a decision it will be. I've noticed that a lot of people that claim they need more time to think about things are overthinkers. So overthinking just creates more of the problem that you already have. It is not what you need to do to solve it. Oftentimes you need to execute. So oftentimes I think it's just a form of procrastination because people don't want to for yourself is really important. So for example, for me, I noticed that for decisions, I don't want to be making decisions at the same time as I'm like executing on something. Like if throughout the week, I'm taking meetings and talking to people and they're coming to me with all these decisions. I'm not trying to make all the decisions at once. Now I know there's certain ones that I can totally make on the spot, low risk, whatever. I have enough pattern recognition and experience, but there's a lot that I don't want to make. And so what I do is I have a running list of decisions. It's just like decisions to make. Things to think about, whatever it might be. And typically it's on the weekend or a morning, one day in the week that I'm going to be like, okay, now I'm going to think about this thing. And I do it all at once because I really do prefer to have time where I'm like, I'm just in decision-making mode versus execution mode. And I do that very frequently. So this isn't like something where it's like, I take a quarterly break. I do this monthly, like this is on an ongoing basis. And if I have decisions that I think would benefit from me, making them faster, then I'm going to make time in my day to make those decisions rather than be executing. So I think that there's like a fallacy that, you know, slow decision-making equates to better decision-making. But I have never seen a fast growing, high velocity organization with slow decision-makers. I've just literally never seen it. And part of this is because there are no high return decisions or high reward decisions that you will make that don't come with risk. And so part of this is that there's a lot of people who don't feel comfortable making a decision that comes with risk. Well, then you probably shouldn't own the business because there is always going to be an immense amount of risk in the decisions you make. I made multiple decisions over the last quarter that could risk an entire product line of our business, could risk a huge investment. I'm totally comfortable with that. And I think that has to come down to part of the reason I think this is an underrated skill and not talked about is because people do not find themselves trustworthy enough to make decisions. It's like, if you don't trust yourself, none of this will work. You have to trust yourself to say, even if this doesn't work out, even if this fails, even if the worst thing happens, I will figure it the fuck out and I'm going to be okay. I'm going to figure out what I need to do to turn it around, to reverse it. A great thing you can ask yourself is like, what's the worst that can happen? And could I live with that? And what would I do if it happened? Like really walk through it. I do this in a lot of different situations in life. Like what is the worst that could happen? Let's go there. And then like, how would I react to that? What would I do in that situation? Sometimes you got to write it down because it's just like, you got to get it out of your head. Now, the third skill that I believe is necessary in decision making is the ability to remove yourself, become objective about a very subjective situation. Most decisions that are hard to make are hard to make mostly because we're really close to the decision. It affects us a lot. It's going to affect us a lot. It could affect our health, our livelihood, our family, our income, all these things. And so because of that, one of the best, I would say like the most important skills to being a good decision maker is the ability to put yourself in a state where you're objective rather than subjective about the decision. So there's different ways that you could do this. Some people just need to be able to ask themselves the right questions. Some people need to get out of their environment. I've seen either one work. It used to be for me that like, I need to like get out of my environment. I need to like go somewhere, go in nature, just get out of, my business mode, right? And get out of this mode where I felt like the stakes were very high. And so sometimes it would even be as much as like a weekend trip or like a staycation or something. I just needed to get out of my environment to be able to like see things objectively. Now, I think I've had enough practice with it. And I, I don't think I like subconsciously hide the pain from myself because I'm, I know I can handle it. I will ask myself a question like, Hey, if a friend came to me with this situation, what would I tell them? If in 20 years, I was looking back and asking myself, you know, what was the right call? What would I say? If in a year from now, I'm saying I'm really proud of myself, which what decision did I make that made me proud? Those are like the type of questions I like to ask myself to get more objective about the situation. Because oftentimes, like, I think we like to think like humans are logical. I really believe we do things based on emotion. Like I make this podcast because I like doing it. It makes me feel good. Um, like logically it grows my business and does X, Y, and Z and does this for my brand. But like, emotionally, it's a good outlet for me and a place to process my thoughts. I probably wouldn't continue doing it if it wasn't that. And if it ever doesn't become that, then that would be very difficult for me. So that being said, being able to be objective is probably one of the most, it's probably the most important of those skills. Those are the skills that go into decisions. Obviously decisions are important because it provides you with more leverage than anything. If you're a leader, I can't think of anything that's a better skill for you. To be able to make good decisions and like see things that other people don't see and be proactive and get ahead on decisions, not just wait for decisions to become a problem. Like I prefer to, to make decisions rather than solve problems. What does that mean? I like to see into the future of what's going to become a problem if I don't decide it now. But you have to be willing to like face the pain of that. And I think that's where a lot of people get tripped up. It's like, it's, it's just not a lot of people that want to subject themselves to the pain. Um, the irony of it is that if you don't, was the best yourself to the pain now you're gonna have more pain later so it's like it's really a lose-lose i will say that in general i think that the biggest reason that we procrastinate that we don't make decisions that we don't invest in the skill is sunk cost like i would say if anything it's sunk cost um you know i can't tell you how many times people come to me and they're like oh my god leila like i've been working on this thing for two years but like it did and i'm like it's the wrong product and they're like but i've been working on for two years i'm like yeah it doesn't really matter like the market doesn't care people don't care and you know i've had to share stories of like you know me and alex when we were growing jamal and prestige labs we were like oh you know what we should do we should get into uh food we should sell food let's also do that that's a good idea and we're like okay so we're gonna sell food we're gonna get into like shipping nationwide meals when we did that we were like so excited we put a year of work into it and like hundreds and hundreds of thought probably i think of over a million maybe like one point one to two million dollars into that barely made any money barely made any money way more support issues way harder than our other businesses not worth the juice of the squeeze and so you know six months into it we're like do we really want to keep doing this and like eventually we just pulled the plug or like it doesn't matter how the fact that we took a year the market doesn't care that we took a year they don't give a fuck this is not for us it is what it is i think sometimes in business you just need to hear that you are going to work so hard on things and you're going to put so much time into people and time into initiatives and into products into companies and they're just not it they're just wrong and you have to cut it and you have to say i lost millions of dollars tens of millions of dollars i have lost some things like this and on people you lose millions of dollars and on initiatives and products and then the time you've lost months years and that is fucking life that's just part of the game so i hope this is helpful i hope that it helps you in making decisions um i know it's a little off the cuff but just something that's been top of mind for me
PodcastTranscript AI