Ben Horowitz explains the distinction between “wartime” and “peacetime” CEOs: peacetime leadership emphasizes long-term development, delegation, and organizational learning, while wartime leadership requires fast, CEO-driven, accuracy-focused decision making often at the expense of organizational development. He cites Andy Grove’s Only the Paranoid Survive and startup examples to argue much of real-world business—especially startups—is wartime in nature.
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Wartime and peacetime. It's really a difference in the decision making process. And the reason that I wrote that piece, Wartime CEO, Peacetime CEO, is that in the management literature, it's almost entirely written for peacetime CEOs. Everything you learn about decision making and delegation and don't micromanage and all these things are very peacetime oriented in the sense that in peacetime you're much more focused on the development of the people and the development of the organization over the long term and the ability for the organization outside of yourself to make higher quality decisions. And that's kind of all affordable. If you've got Google search and you're just like steamrolling through the industry, then you can do a lot more kind of peacetime sort of things. On the other hand, if you're running out of cash, or if you're like Apple when Steve Jobs first took over and they had three weeks of cash left and so forth, that's not affordable. In the decision making process, you've got to get to a very accurate decision extremely quickly. That's when the wartime techniques come into play. And sometimes in wartime you end up doing things that actually do undermine the development of the organization because there's more burden on the CEO to make a much larger number of decisions because accuracy is so important. And the CEO, by virtue of her position, has got more knowledge to make those decisions and more authority too, to make them definitive and fast and high quality. So that is a lot about what that was about. Andy Grove has a great book called Only the Paranoid Survive, which a lot of you probably have read here. But there's a part of it where he talks about when he turned intel from the memory business into the CPU business, which is like a real wartime story. Like, it's like, okay, like I walked into the room and I was like, okay, what would we do if I was fired tomorrow? And then like somebody came in to replace me and then all my whole staff was fired and replaced all of them. What would they do with the business? And then like I walked out to the car like I had a cigarette. I looked out into the distance. I was like, all right, we gotta lay off 80% of the people. And you know, those kinds of things, they're just not things that you kind of normally encounter in the business education. But in the real business world, that's like most of it, most of it ends up being wartime. Particularly in startup world, Like a huge amount of it ends up being wartime. So that's kind of the basic.
