Amazon CEO Jeff Bezos had some intriguing things to say about decision making in a recent letter to Amazon shareholders. He differentiated between “Type 1” vs. “Type 2” decisions.
‘There’s a problem with “one-size-fits-all” decision making. Some decisions are consequential and irreversible or nearly irreversible – one-way doors – and these decisions must be made methodically, carefully, slowly, with great deliberation and consultation. If you walk through and don’t like what you see on the other side, you can’t get back to where you were before. We can call these Type 1 decisions. But most decisions aren’t like that – they are changeable, reversible – they’re two-way doors. If you’ve made a suboptimal Type 2 decision, you don’t have to live with the consequences for that long. You can reopen the door and go back through. Type 2 decisions can and should be made quickly by high judgment individuals or small groups.’
He also had advice about how much information you need to make a decision.
‘Most decisions should probably be made with somewhere around 70% of the information you wish you had. If you wait for 90%, in most cases, you’re probably being slow. Plus, either way, you need to be good at quickly recognizing and correcting bad decisions. If you’re good at course correcting, being wrong may be less costly than you think, whereas being slow is going to be expensive for sure.’
Reference: https://www.amazon.com/p/feature/z6o9g6sysxur57t