Two Types of Decisions

About a year and a half ago, I applied for a position at Amazon. As I prepared for the interview, I was exposed to Amazon's Leadership Principles, and I quickly became a disciple. They provide a great framework on how to be an effective leader and innovator. A+++ highly recommend.

Today, I was exposed to something that Jeff Bezos originally wrote in his 2015 letter to shareholders. He discussed two types of decisions.

• Type 1 decisions represents a door you walk through and can’t go back, such as quitting a well-paying job to focus on your side-hustle full time.
• Type 2 decisions represent a reversible choice by an individual or smaller groups, for example, testing a new product with a group of beta customers or the layout of a section on the Amazon store.

In a follow up Forbes article on the same topic, the advice on making these two decision was:

• Spend up to 10% of your work week on Type 1 decisions. These are draining and time-consuming, but they demand your attention.
• Make Type 2 decisions relatively quickly by batching them, delegating to a team member or outsourcing to a contractor.
• Entrepreneurs or executives who embrace their choices learn far more than the people who run away.
• Embrace the unintended consequences of Type 2 decision. These consequences may turn out to be better than the original intent.

These line up very well with Amazon leadership principle of Bias for Action: Speed matters in business. Many decisions and actions are reversible and do not need extensive study. We value calculated risk taking.

This decision framework is one I will be personally adopting. The Bryan Collins article is well worth the read.