Concept
Hard decisions
Hard decisions, in Horowitz's account, are the choices only the founder can make, on incomplete information, that hurt someone whichever way they go, such as firing a friend, cutting a product or changing the strategy; making them is the job, and the loneliness of it is not a sign of doing it wrong.
Most of The Hard Thing About Hard Things is about decisions that have no good option: demoting a loyal executive who has stopped scaling, laying off people who did nothing wrong, telling a customer the product they bought is being discontinued. Horowitz's contribution is not a formula but a set of observations that make the decisions survivable. First, the information will never be complete, and waiting for it is itself a decision, usually the worst one. Second, the founder must make the call personally and explain it personally to the people it affects; delegating the explanation is a betrayal. Third, the priority order is fixed: take care of the people, the products and the profits, in that order, which means the decision is made with the people in mind even when it hurts some of them. And fourth, the loneliness is structural. No one else has the whole picture, so no one else can decide; that is what CEO means.
A real-life example
A founder in Istanbul kept a co-founder in charge of engineering for a year after it was clear the team had outgrown him, because they had started the company together. The delay cost two senior engineers who left over the chaos. When she finally made the change, she made it herself, in person, with a real role designed for what he was actually good at. He stayed. The engineers did not come back.
How to use it
- 1Decide on the information you have, by a date you set, and treat waiting for certainty as the decision it actually is.
- 2Make the call yourself and explain it yourself, in person, to everyone it affects.
- 3Keep the order fixed: people, then products, then profits. A hard decision made in that order can be defended; one made in the reverse order cannot.