Position Based Decision Making

15 January 2021
Justin Warren


> “Find out who you are, and do it on purpose.” — Dolly Parton >

Scaling a startup, running a business, or just leading a team is mostly about making decisions. Making choices.

Figuring out which option to choose can be tricky, especially in an early stage startup where there are lots of unknowns and many possible choices. Is this a good choice, or a mistake? How can you tell?

A strong position, for your product or the whole company, can help you make better decisions faster.

Less is More

It's hard to make good choices when there are lots of competing options. A strong position helps narrow the available set of choices.

A strong position can help you say “No” to a bunch of options very quickly. You simply ask “what does our position say we should do?”

Do you think Disney should develop a range of intercontinental ballistic missiles? Obviously not.

Should a startup targeting enterprise IT departments make soap? Nope.

What about a PS5 game? Probably not. An app? Maybe.

When you can quickly eliminate most choices, you can focus your attention on just a few good ones. That way, even if what you choose isn't the best option, it's still pretty good.

Quickly making lots of pretty good choices is how you succeed over time, thanks to path dependency and the magic of compounding.

Strong Positions Provide Focus

There are a large range of possible things any new company could do. But you don't have the time, money, or people to do all of them, which means you need to choose a few of them to focus on.

Choosing too many options dilutes your efforts and means you can't do any of them well. A timid, choose-everything approach spreads your resources too thin and, ironically, ensures you'll fail at all of them instead of maybe succeeding at one or two.

It also helps you scale your team, because if everyone knows the position, they can ask themselves “what does our position say is the right choice here?” instead of having to get your attention to make every choice for them. You can spend your time on fewer, trickier choices instead of wearing yourself out figuring out which shade of yellow the footer text on the website should be.

You will have a position whether you choose one deliberately or not.

So figure out who you want to be, and then do it on purpose.