| 6.2°C Dublin

Startup diary: Treat decision-making as another skill that your firm can gradually improve on


Feedback loop: Keeping a decision journal can help businesses to review their actions

Feedback loop: Keeping a decision journal can help businesses to review their actions

Feedback loop: Keeping a decision journal can help businesses to review their actions

This week will be the last Startup Diary for a while. It is somewhat ironic that in writing about our sales pipeline, I now find myself very busy because of it.

Voxgig is now at that point where customer activity and interest are racing ahead of the size of our team, and we're fighting fires all over the place.

That's a good thing. It's the way it's meant to be.

But it does mean that my time is now just a little too squeezed.

As a founder, you have to keep staying ahead of burnout; it has happened to me before, and it is not pleasant.

While this formal article series is ending, I may continue Voxgig updates and startup thoughts in a more streamlined format - keep on my Twitter (@rjrodger) for updates.

This week, I want to return to the reason I started writing these articles in the first place.

The biggest problem you face in building a startup is making the right decisions. Now, you can make all the right decisions and still fail.

But the law of averages tells us that you'll make your share of bad decisions and good decisions in equal measure.

Even famed generals like Julius Caesar and Alexander the Great eventually 'reverted to the mean' and screwed up.

If the outcomes of your decisions are subject to idle whims of the fates, how do you cut that cord, and get some control back?

By treating decision-making as another skill, as something you can get better at.

The key to improving a skill is to get feedback. You would think that startup decision-making, as a skill, is somewhat blessed by having direct feedback. You either get funded or you don't; you either sell your product, or you don't; you either get users, or you don't. The outcomes are clear.

The problem is that outcomes are not directly connected to business decisions.

There's too much else going on. There's too much luck involved, for a start. And you focus on outcomes; you 'over fit' (there's a nice bit of machine learning jargon for your pitch deck!).

That means you attach far too much weight to the outcome, and judge the decision-making process by it. Since the real world always catches up with you in the end, you make bad decisions as a result.

How then can you judge the quality of your decision-making? One way is to review your decisions, dispassionately, some time after the fact.

This separates out all the emotion, and lets you understand the root causes and effects.

This is a form of feedback, and this is how you can improve your business decision-making. But you can't just 'do' this - you need a tool to keep yourself clear-headed and impartial. You are your own worst enemy when it comes to fooling yourself!

What you can use is something called a 'decision journal'. The idea is that you write down your decisions, and why you made them.

You do this before you know the outcome. That way, the line of thinking that went into the decision is not biased by the outcome.

I've found that reading business biographies is a very valuable way to learn about entrepreneurship, but that they still leave gaps.

These gaps are the parts where the author papers over all the mistakes!

That does not happen with a decision journal, because you write about your decisions ahead of time.

Later, you can review the journal to see if your thinking worked out.

This is where you get the feedback loop going. This is where you learn to make better decisions.

You've divorced the somewhat chaotic business outcome from the quality of the decision-making.

The outcome is part of the analysis, but now that you have the benefit of hindsight, it should be easier to see if the elements of the decision themselves led to the outcome, or some other factor.

For example, in our case, you could not have predicted that Brexit would be quite such a mess in 2019. It has affected our UK sales, but I am not in a panic about our UK sales strategy, which we continue to execute as before. We have the confidence to do this because we can literally pull out my Startup Diary articles from 2019 and go over them, looking for holes. This is very powerful.

With this article series, I also took the decision to make our decision journal public. That's taking things to the next level.

It's not necessary for the feedback loop to work - you can keep a private journal internal to your business.

The fact that we ended up doing much of our decision-making in public is just one of those lucky accidents.

I do feel it has been wonderfully helpful to Voxgig as a business; it certainly has kept us honest!

I will end then with this advice: keep a decision journal, and review it each week with your team.

This is one of the most powerful things you can do for your business.

Now, get out there and change the world!

Indo Business