Spearhead AI consulting

Achieve Success with Jeff Bezos’ Type 1 vs Type 2 Decision-Making Method

Your decision making might be impacting your organization and your career.

Here is a decision-making strategy that could transform the way you run your organization, and your life.

This is Jeff Bezos’ Type 1 vs Type 2 decision making framework.

Type 1 Decisions: These are almost impossible to reverse. Selling your company, quitting a job – once you make a Type 1 decision, there’s no going back.

Type 2 Decisions: These are easy to reverse. Starting a side hustle, offering a new service – Type 2 decisions might feel momentous, but they can be reversed with a little time and effort.

The Trap: It’s easy to mistake a Type 2 decision for a Type 1 decision, leading to paralysis and no decision at all.

Jeff explains it eloquently in one of his shareholder letters:

“Some decisions are consequential and irreversible or nearly irreversible — one-way doors — and these decisions must be made methodically, carefully, slowly, with great deliberation and consultation. If you walk through and don’t like what you see on the other side, you can’t get back to where you were before. We can call these Type 1 decisions.

But most decisions aren’t like that — they are changeable, reversible — they’re two-way doors. If you’ve made a sub-optimal Type 2 decision, you don’t have to live with the consequences for that long. You can reopen the door and go back through. Type 2 decisions can and should be made quickly by high judgment individuals or small groups.

As organizations get larger, there seems to be a tendency to use the heavyweight Type 1 decision-making process on most decisions, including many Type 2 decisions. The end result of this is slowness, unthoughtful risk aversion, failure to experiment sufficiently, and consequently diminished invention. We’ll have to figure out how to fight that tendency.”

Bezos suggests five rules to guide you toward making decisions quickly and effectively:

1. Never use a one-size-fits-all decision-making process.

2. Don’t make all decisions by yourself.

3. Don’t wait for all the information.

4. Don’t require lengthy approvals through large numbers of hierarchical layers.

5. Don’t wait for everyone to agree. Agree to disagree

Distinguishing between Type 1 and Type 2 decisions, and applying the principles of high-velocity decision-making, can lead to better, faster decisions, and ultimately, more predictable success.

What are your thoughts on Bezos’ decision making framework?

#decisionmaking #framework #amazon #bezos #careeradvice

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