Published in the San Diego Union-Tribune, March 14, 2022
by Neil Senturia
There is a famous story about venture capitalists. It says that if the one you are pitching to likes to invest their money in chocolate cakes, don’t bring them lemon meringue and try to convince them it is just as good as chocolate.
I would like to call attention to a San Diego Union-Tribune March 1 column by Charles T. Clark on the subject of homelessness in San Diego. One sentence absolutely stunned me.
“For instance, under Project Homekey … the state set aside about 61 million dollars for supportive housing in San Diego County … and our region’s cities failed to provide any proposals to the state by the Jan. 31 deadline.”
Huh. When was the last time you could afford to just walk away from free money? All you had to do was write a “proposal?” I don’t have all the facts, I leave that to the investigative reporters, but on the face of it, it is hard to understand not lobbing in a few paragraphs that look like a “proposal.”
And that leads to a Bloomberg Business Week story by Daniel Moore on the subject of “considering multiple outcomes.” I am fascinated by this puzzle. The usual way to tackle this stuff is to make a decision tree — a what if this, then that, and if that, then what. And so it goes. But before you even plant the tree you have to till the soil.
In my little world, I frequently have clients or partners who have developed Plan A, and occasionally, also a Plan B, but very few have thought about Plan C – Z. Why?
I think the answer is that we really don’t want to look that hard. The onslaught of potential unintended consequences can become a tsunami. I have a client who is in litigation, and the next step is ostensibly mediation. I ask him what he plans to do if the other fellow decides not to mediate. He was stumped. His default option is call some more lawyers. That makes no sense.
If he had looked carefully at the conflicted relationship a year ago, he might have acted differently. The example often given for anticipating crisis is Mount Everest. Things change quickly up there, and advance planning is critical. The pandemic has required leaders to create multiple scenarios, almost on the fly. Theodore Klein, Boston Strategy Group, says, “Ambiguity and unintended consequences are now the norm.”
He offers some suggestions. Gather the team together to brainstorm “all possible” scenarios. That is not so easy. It means considering the most unlikely (e.g. worldwide pandemic, Russia invading Ukraine), and then developing scenarios to deal with it.
Add to that the calculus of timing. Nick Drewe, CEO, Wethrift, “You want to be very clear on defining what and when each trigger will be put into action.” Not too soon, not too late. On balance, in my startup world, I mostly see a reluctance by CEOs to pull the trigger. Hope is not a strategy.
A few years ago, I participated in a San Diego Police program for civilians. One classic exercise was a simulation where you are confronted with a hostile situation and a potential threat — and when should you fire your weapon. Too soon and you kill an innocent mother, too late and you are dead.
Since you can’t plan for every scenario, what is the model? Think football coaches and players. There is the play book with basic strategies that the players memorize. They cannot think of every possibility, but as a team, they develop a common vocabulary, “and then they react on instinct.” Muscle memory, pattern recognition.
I preach the idea of a “moment.” There is always a particular time in any deal when there is a moment to find agreement, to make the deal, shake hands. Look carefully because this moment is fleeting, as well as the moment to walk away. “Know when to fold ‘em.”
The trigger issue, multiple outcomes and the moment for success intertwine. Think about the first time you kissed your partner. Instinct, fear, excitement.
Kandi Gongora, CTO of Goodway Group, calls this the “cone of uncertainty.” Like mapping a hurricane. You are not positive about where it will touch down, but regardless, you need to stock up on umbrellas.
Rule No. 704:
Plan ahead but live in the present.