Keith Rabois uses Andy Grove's decision matrix to help CEOs figure out what to delegate. Plot decisions by your confidence level and their consequences: keep high-stakes calls you're sure about, delegate low-stakes ones to develop your team, and either learn fast or find experts for risky decisions you're unsure of. You stay accountable either way.
Chapters
One of the most difficult challenges when you're building a company is to figure out when to delegate responsibilities for a decision to your colleagues and when to make the decision yourself. Ultimately, as CEO and founder, you're responsible for everything. You can never abdicate the responsibility for the quality of the decision. But on the other hand, it's very difficult to scale an organization if you're making every single decision. So there's a fine line between delegating and abdicating. And there's a technique that I learned mostly by reading High Output Management, which is written by Andy Grove, one of the most important executives in the history of Silicon Valley, leading Intel for probably 20 years, and published this book that's really the Bible on managing technology companies called High Output Management, which is when to delegate and when to not delegate. And there's basically a matrix of how confident you are as an executive leader, founder, CEO in your decision versus the consequences. So there's low consequence decisions, and very high consequence decisions. And in the category where you have high conviction and high consequence, really as CEO, you need to make that decision. You need to be comfortable with that decision. You can't delegate that. Then there's the other quadrant, the extreme other quadrant would be low conviction. So I have low confidence in my ability to make this decision and it has moderately low consequences for the organization. In those cases, you should absolutely be delegating every time. Basically to allow your colleagues to grow and also to watch how they make decisions. One of the ways to tell someone's ability and test their ability is to let them make decisions and then see if those decisions are successful. Jeff Bezos refers to this as the key ingredient for success as a leader at Amazon is leaders are right a lot. So the only way you can tell if someone's right a lot is you have to let them make a lot of decisions. So that's the easiest. The hardest one is high consequences, low conviction about what to do, how to resolve that, as well as the other quadrant. But fundamentally, most things sort naturally into the first and fourth quadrants. And if you just get those quadrants right, it'll make your job as an executive or co-founder or CEO really easy.
