It’s hard to imagine Google as anything other than the $90-billion-a-year behemoth it is today, with its 57,000+ employees and its hand in seemingly every industry, from search to email to maps to cellphones.
But, in 2001 when Eric Schmidt was named CEO, it was a $120-million-a-year company, with no guarantee it would grow to become what it is now. But, even back then, Schmidt saw the seedlings of the culture that would become essential to it scaling the way it eventually did.
Specifically, he saw not just a collection of brilliant minds, but also encouragement from leadership-on-down to share and work on new ideas, no matter how outside-the-box they might be. Schmidt welcomed that as CEO.
But there was another key trait that was paramount to Google’s success, in which Schmidt helped operationalize: fast decisions. Without management making fast decisions, ideas would take too long to execute, priorities would become congealed and those brilliant employees would grow disengaged.
“The most important thing to do is to have quick decisions,” Schmidt said in Reid Hoffman’s new podcast, Masters of Scale. “You’ll make some mistakes but you need decision making.”
How Google operationalized fast decisions
At Google, there was no shortage of brilliant ideas coming from brilliant people. The challenge then became what brilliant ideas to fully execute on, decisions on which Schmidt wanted to make as quickly as possible.
So, Google set up three meetings a week – one for staffing decisions, one for product decisions and one for business decisions. If you had a proposal, you could bring it to that meeting and a decision would be made on it, Schmidt said in his interview with Hoffman.
“As long as you could wait a week, you knew you would get a hearing,” Schmidt said.
All decisions at Google were made that way, that quickly. Schmidt said even the decision to buy YouTube – perhaps the most impactful acquisition in Google’s history – was made in 10 days.
“I always tell people, ‘someone is running your company’,” Schmidt said. “What are they doing? Why don’t they just make this decision?”
Schmidt readily admits that there will be mistakes when making decisions quickly. But, “even if it’s the wrong decision, a quick decision is almost better than anything,” Schmidt said.
Schmidt is far from being the only prominent CEO to feel this way
Schmidt is hardly alone in believing that managers need to make decisions quickly. Jeff Bezos, founder and CEO of Amazon, also subscribes to this theory.
In his annual letter to shareholders this year, Bezos described the importance of Amazon making decisions as quickly as a startup would make them. “Most decisions should probably be made with somewhere around 70 percent of the information you wish you had,” he wrote. “If you wait for 90 percent, in most cases, you’re probably being slow."
Bezos said most decisions are reversible anyway, and all require some degree of course correcting. That makes “being wrong may be less costly than you think, whereas being slow is going to be expensive for sure,” he wrote.
The Harvard Business Review also analyzed more than 2,000 assessments of CEOs to identify the qualities the best ones share. One of those traits was decisiveness.
“A bad decision was better than a lack of direction,” Greyhound CEO Stephen Gorman, who led the bus operator through a turnaround, told HBR. “Most decisions can be undone, but you have to learn to move with the right amount of speed.”
“Once I have 65 percent certainty around the answer, I have to make a call,” said Jerry Bowe, CEO of the private-label manufacturer Vi-Jon, told HBR, in a statement that sounds eerily similar to Bezos’.
What this means to you
For a company, implementing this strategy is really two-fold. It comes down to setting up a structure where decisions can be made quickly and then giving your leadership team the training it needs to make quick decisions.
For the former, Schmidt’s model of weekly meetings where anyone could bring a proposal forward allows for very fast decisions and clear decision-makers. Maybe that won’t work exactly for your organization, but you need to build a culture that emphasizes those two qualities: trust in leaders to make decisions and clear decision-makers.
Secondly, making fast decisions is a skill. While some leaders are inherently better at making fast decisions than others, you need to train your people so they feel comfortable making those quick decisions.
The result of all of this is an organization that’s going to move faster, with clearer focus. And that’s particularly essential in today’s high-paced world, where the rate of change demands agility.
*Image from Chatham House, Wikipedia Commons
LinkedIn Learning courses that teach that teach decisiveness are:
Topics: Productivity tips
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