Our founder and CEO Erik Larson recently sat down with international entrepreneur and Huffington Post contributor Michael Park for a chat about decision making, especially in the high pressure, fast-moving environment of Silicon Valley.
As Michael puts it:
How do we know what the right decisions are, particularly in a startup environment? Entrepreneurs perpetually operate in conditions of extreme uncertainty, in which it’s unclear how to find the right answer - let alone ask the right questions.
In the course of their lively discussion (which we suggest you read in its entirety), Erik revealed five paradoxical truths on decision-making.
Here are some decision-making highlights to whet your appetite:
The most important decision a business leader makes is what problem to solve. And it’s tricky. One of the biggest tricks comes right at the start thanks to a quirk of our brains - we overweight things that happened to us recently. Unfortunately, there is not much reason to believe that a problem is especially important just because it happened to us recently. Even worse, once we have a hypothesis, we seek out information that supports our current thinking. We are the man who loses his keys and then looks for them beneath the streetlight because that’s where he can see best.
Strange but true - more data doesn’t help people make better decisions. More data is powerful when it highlights or eliminates decisions, but most of the time data is a befuddling mixed bag when it comes to decision making.
Storytelling is a powerful tool. Good stories leave out everything that would distract from the excitement of knowing what happened. The best stories do this without you even noticing. Suddenly, you know something new and it makes sense. In a business context, this drives success.
Cloverpop is part of the next wave of B2B SaaS companies that use design thinking to dig deep and identify big business process problems that can be solved by software. This is hard, but the payoff is huge. We can see that decision-driven work is a broken process inside most companies, one that is responsible for some of the worst parts of work - annoying meetings, flaming emails, politics, frustration, unaccountability - and that a software platform like Cloverpop can actually make the process better.
For more insights--including what entrepreneurs should about VCs and decision making--read the full article (as well as Michael’s other great CEO profiles) here.