Founder Intuition vs. Team Expertise vs. Customer Expertise:

Founder Intuition vs. Team Expertise vs. Customer Expertise:

Understanding the Dynamics of Decision-Making in Startups

When it comes to decision-making in startups, there are three key factors at play: founder intuition, team expertise, and customer expertise. These factors influence how decisions are made at different stages of a company's growth, and understanding their dynamics is crucial for sustainable success.

In the early stages of a startup, founders often rely heavily on their own intuition. After all, they are the ones who came up with the business idea and have a deep understanding of the problem they are trying to solve. However, one common mistake founders make is deferring too many decisions to new employees too quickly. They may convince themselves that these new hires are experts in their respective fields and should be trusted with important decisions. In reality, founders are the true experts on the business, and their intuition should not be overlooked.

As the business grows and more talented individuals join the team, founder intuition can start to waver. The founders may find that their initial advantage of having spent more time on the problem diminishes as the team gains expertise and knowledge. This degradation of founder intuition happens at different times for different parts of the business. Great founders recognize this shift and start to rely more on the expertise developing within their team. They are open to being proven wrong and are willing to question their own judgment.

For startup employees and leaders, it is important to respect founder intuition, especially in the early stages. After all, the company would not have reached the point of hiring if the founder's intuition hadn't served them well. However, as you and your team gain a deeper understanding of the business and develop better judgment than the founder in certain areas, it is crucial to signal that confidence and align on a new operating model. It is worth figuring out how to communicate to the founder when their involvement may be unhelpful and when it is valuable for them to lean in.

Interestingly, the split between intuition and expertise is not only applicable to founders and employees but also to the relationship between a company and its customers. In the early stages, most founders and employees tend to believe that the customer knows best. They observe how customers use their product and adopt their behaviors. However, as the company scales and gains a deeper understanding of its customers, the focus shifts from observing to teaching. The company becomes aware of best practices that can make customers more successful and starts guiding them in that direction.

Just as founder intuition ebbs over time, so does customer expertise. Founders and employees spend time on deep company problems and become a lot smarter in understanding what works best for the customers. It is important to have a dialogue about where teams are in this journey to help the startup scale and leverage the founder's expertise in the areas that are most highly leveraged.

Now that we have explored the dynamics of decision-making in startups, let's discuss three actionable pieces of advice for founders and teams:

• 1. Recognize the value of founder intuition: Founders, trust your gut instincts, especially in the early stages. Your deep understanding of the problem and the business is invaluable. However, be open to feedback and new perspectives from your team as they develop expertise.

• 2. Communicate shifting operating models: Team members, if you believe a decision is better suited for the founder's judgment, don't hesitate to voice your opinion. Establish clear channels of communication to signal when it is valuable for the founder to lean in and when their involvement may be unhelpful.

• 3. Embrace the evolution of customer expertise: As a company grows, the focus shifts from observing customer behaviors to teaching them best practices. Continuously learn from your customers and adapt your product or service to better serve their needs. Use data and feedback to guide your decisions.

In conclusion, the dynamics of decision-making in startups are complex, involving founder intuition, team expertise, and customer expertise. Understanding how these factors evolve over time is crucial for sustainable growth. Founders should trust their intuition but be open to the expertise developing within their team. Team members should respect founder intuition while also voicing their opinions when appropriate. And as a company gains a deeper understanding of its customers, it should shift from observing to teaching, guiding customers towards best practices. By navigating these dynamics effectively, startups can make informed decisions that lead to long-term success.