Published in the San Diego Union-Tribune, October 24, 2022
by Neil Senturia
I waited too long.
I knew that I had to fire someone, and I really did not want to do it. I had a Rubik’s Cube dilemma. I kept spinning it, hoping to find the perfect fit, when I knew hard and deep in my gut that this particular cube was not going to lend itself to an amicable solution.
And so finally I did it. I terminated “Jones,” and then I did some housekeeping and also cut the burn rate. The instant I had completed those jobs, I was relieved and was positive that it was the best outcome for the company. I may have winced for a second but no revisiting the scene of the crime.
Later, I chastised myself because I teach this stuff. I know the rule. Why was it so hard to do what I knew was the correct thing to do?
Here is the conundrum. By the time you realize you need to quit, or you need to terminate or you need to change course, at that instant, it is already past the sell-by date. You have waited too long.
But if you execute prior to that realization, you will have acted too soon, prematurely and with the deep possibility of regret. You are haunted by the doubt — I should have waited.
Imagine this fantastic knife edge. The first step is too soon, and the next step is too late.
When an entrepreneur comes to see me, it is usually when they are in a mess with a puzzle that demands immediate attention. Often in the space of a couple of hours, a rational decision can be formed and agreed to. Again, often, it comes down to an action that needs to be taken immediately but should have been taken weeks ago or months ago, and sometimes years ago.
We write it on the whiteboard, we agree, the client leaves, and then half the time, calls me back an hour later to say he thinks he has to wait, there is new data, let’s meet again in a few weeks. Huh?
The existential question — why is it so hard to do some things? I am not talking about climate change or homeless or affordable housing. Just simple things like stop the madness at home, eliminate the pain at the office, take the needle out of your arm.
The details of my Rubik’s Cube are irrelevant. What surprised me was how conflicted I felt during the process. Whether it is pivoting your company, leaving your partner, accepting sunk costs or a whole host of things, the bottom line is that we humans are reluctant to do things that are uncomfortable — and even more to the point, especially decisions that call into question our original thinking on the matter, which is what got us into the mess in the first place. Who wants to step up and shout to the rafters that I was an idiot?
It is always easier to pull the trigger if you didn’t buy the gun, and don’t have a long relationship with the issue or person, but when your original decision-making is in play, that is why you delay. Because now you have to admit the error of your decision, and then you have to fix it, and there is always a cost to that.
Sunk costs haunt every entrepreneur. The story of the company Flow is classic. Eleven million dollars down the drain because the creator, Andrew Wilkinson, believed that his fabulous software alone could win. And the haunting refrain — early on he had the chance to sell to his main competitor and make money, but he turned it down.
So his competitor went out and raised $20 million. Now Wilkinson was up against someone with more money, bigger guns, more ammunition and a desire to crush him after being rebuffed. Wilkinson says, “I was consistently spending two to three times our monthly revenue and losing money — and not venture capital, but out of my own personal bank account.” In retrospect, he realized that he had only brought a pocket knife to a gunfight.
Do not pass up off ramps on the freeway unless you are sure you have enough gas to get to the next rest stop.
Rule No. 735:
Calculate carefully your miles per gallon.