(Originally published by David in Fortune Insiders)
A mistake that is not only foolish in the moment, but that can have long-term negative impact is letting difficult decisions linger. Maybe you’re procrastinating on dealing with a “people issue,” such as needing to let someone go for the good of the organization. Or, perhaps you’re reluctant to admit that your current business strategy or product just isn’t working out and you need to start over. If you agonize over informing stakeholders of a problem that has come to your attention, issues like these will only get worse.
Many of us tend to avoid the hard things — the decisions and actions that may make others unhappy or prove to be unpopular. As humans, we don’t like to be the bearer of bad news and disappoint people.
With difficult decisions, though, the longer you procrastinate in taking action, the worse things can become. For example, firing someone can be painful, and having empathy for the person to be terminated may delay your decision. But the longer the person stays in a job that, for whatever reason, is no longer a good fit, the worse it is for the rest of the organization. In my own experience, I can recall situations in which people needed to be let go, but we dragged our feet on making the decision because it was hard (not because the choice wasn’t clear). By the time we acted, what had started as a manageable problem had mushroomed into a major organizational issue.
When it becomes clear that a product or strategy isn’t working, the thought of disappointing stakeholders can be so overwhelming that you put off the decision to change direction or go back to the drawing board. That reticence may be tied up in not wanting to disappoint others, including customers and investors. But often, there is a deeper reason — ego. You’ve invested so much time, money, and energy into a particular strategy or product, that now you’re disinclined to admit that you were wrong. In this instance, your reticence to make the decision is all about your need to be right.
In startups, the ego issue is further inflated because of the glamour associated with entrepreneurship; you may tell yourself that the only way to bask in that glow is to be right. With this thinking, “humble pie” becomes very unappetizing. True entrepreneurial leadership, though, requires having the maturity to know that things don’t work out all the time. Moreover, telling investors about a problem as soon as it hits your radar may actually net a positive , even if the news is disappointing initially.
With startups and other early-stage companies, experienced investors expect problems and setbacks. Even more important, savvy investors have ideas, connections, and other resources that can help solve problems. But if you wait too long to tell your supporters, there may be nothing they can do.
There is another decision that should never be delayed: when there is an ethical problem. The longer a breach of ethics goes unaddressed, the worse the problem becomes — a potentially fatal mistake for the company, its brand and reputation, and its longevity. For example, Theranos is facing federal, civil, and criminal investigations after serious questions were raised about the validity of its testing products that were said to require only a few drops of blood. Theranos CEO Elizabeth Holmes has been banned from operating a laboratory for at least two years, and the company continues to face difficulties, including an investor lawsuit.
In contrast, consider the actions of Johnson & Johnson and its McNeil Consumer Products subsidiary when several people died in 1982 after taking Tylenol that, unbeknownst to anyone, had been contaminated with cyanide. The swiftness of the company’s response and the transparency of its actions allowed it to recover consumers’ trust and preserve the valuable brand. It’s hard not to wonder what would have happened had Theranos followed J&J’s lead and disclosed the reported problems with its blood tests as soon as they surfaced.
For startups and early-stage companies, the road forward is often bumpy and unpredictable. But being unable or unwilling to make tough decisions quickly will only compound problems, and lead you to regret a foolish mistake.
Copyright © 2019 by Carter Cast, David Schonthal, Craig Wortmann. All rights reserved.
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