John F Kennedy said “There are risks and costs to action. But they are far less than the long-range risks of comfortable inaction”. One of the most useful and important things to determine early in your project planning process about a proposed change is whether the change is easily reversible. This knowledge can help determine the best course for managing the project.
It is always good to know as much as possible about any possible change to your business, manufacturing process or marketing approach before making the change. You would like to move all the information into the Known Known Quadrant before making a decision. But getting all this information takes time, and in some cases you will never get all the information before making any change.
You can implement a change much more quickly if you can act with less information. Military operations are the usual source for ideas about acting fast with less than prefect information. General George Patton liked to act fast with 70% of the information to keep a military advantage. US Air Force Colonel John Boyd was a renowned fighter pilot and developed the OODA loop for making quick decisions and acting. OODA stands for Observe, Orient, Decide, Act, and is a good system for dog fights and other situations when you have to make quick decisions.
In our business we do not have to operate with the urgency of military maneuvers, but we do need to act. We need to avoid the all too prevalent danger of Paralysis by Analysis. How often when you propose a change are you asked to go and do more testing and analysis to absolutely confirm that the change that you propose will be a success? Because 100% certainty if unlikely this attitude of your management will likely prevent the change from happening before its window of opportunity closes.
The first answer you should give to any proposed change is whether it can be easily reversed if it bombs. Most changes in business can be reversed relatively easily if needed with only a minor cost of time and money and no major harm done. I have seen regulatory change notices to reverse an unsuccessful change completed in around a week with no interruption to supply. If you know that this is the worst that could happen, it should make decisions about proceeding with less than perfect information easier to make.
This has been best described by Amazon Founder and CEO, Jeff Bezos. In a letter to shareholders Bezos compared making a decision to going through a door. Is the door one-way or two-way? Most doors are two-way. If you don’t like what you see go back. Bezos calls there type 2 decisions. Only some doors are one-way not allowing return. Bezos calls these irreversible decisions type 1.
Analyze the potential change to determine if it can be reversed easily and if it can, you can proceed quickly with less than perfect information knowing that you can go back. Jeff Bezos proposes proceeding if the decision looks good when you have 70% of the information. If the decision is irreversible, delay decision as long as possible.
As companies grow larger bureaucracies, they tend to treat more decisions as irreversible Type 1 and act more slowly. This is also a tendency in regulated industries. But most business decisions are reversible and can be made more quickly and easily with the worst case being that we have to go back to the way we used to do it. And if we do reverse an unsuccessful change, it is not a total loss as we now know more about our process.
So when you are proposing your next great plan don’t just emphasize its potential benefits. Also, stress that if it does not work out, we can just undo it at no great cost. You have the potential to make a major gain with risk of a minor cost.
To paraphrase the serenity prayer, you should take reversible decisions as soon as possible, delay irreversible decisions for as long as possible, and have the insight to understand the difference between the two types.