Reversible and Irreversible Decisions
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Highlights
- If a decision is reversible, we can make it fast and without perfect information. If a decision is irreversible, we had better slow down the decision-making process and ensure that we consider ample information and understand the problem as thoroughly as we can.
- Reversible decisions can be made fast and without obsessing over finding complete information. We can be prepared to extract wisdom from the experience with little cost if the decision doesn’t work out. Frequently, it’s not worth the time and energy required to gather more information and look for flawless answers. Although your research might make your decision 5% better, you might miss an opportunity.
- Reversible decisions are not an excuse to act reckless or be ill-informed, but rather are a belief that we should adapt the frameworks of our decisions to the types of decisions we are making. Reversible decisions don’t need to be made the same way as irreversible decisions.
- With practice, we also get better at recognizing bad decisions and pivoting, rather than sticking with past choices due to the sunk costs fallacy. Equally important, we can stop viewing mistakes or small failures as disastrous. Instead, view them as information that informs future decisions.
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Once you understand that reversible decisions are in fact reversible you can start to see them as opportunities to increase the pace of your learning. At a corporate level, allowing employees to make and learn from reversible decisions helps you move at the pace of a start-up. After all, if someone is moving with speed, you’re going to pass them when you move with velocity.
- The biggest risk to irreversible decisions is deciding before you need to. The biggest risk to reversible ones is waiting until the last minute. Make reversible decisions as soon as possible and make irreversible decisions as late as possible.