Startup Words Wednesday: Analysis Paralysis


In this week’s Startup Words Wednesday I’m going to address a phenomenon I frequently see demolishing brick-and-mortar businesses and startups: analysis paralysis.

Entrepreneurs, data scientists, domain investors and other key decision makers often want 100% of the information before making a decision. It’s a very rare occasion when this happens and procuring this data is often a waste of time and resources. Jack Welch put it best in his book Winning when he said “Effective people know when to stop assessing and make a tough call, even without total information. Little is worse than a manager who can’t cut bait.” What’s worse is when they work to accumulate all the information, they become even more confused than when they began, all the meanwhile exhausting their available time to act.

Analysis Paralysis

This occurs when an individual becomes so lost in the process of examining and evaluating various points of data that he or she is unable to make a decision with it.

There’s not a day that goes by that I don’t come across a manager that wants endless information on potential hires, a CMO that wants more research before moving ahead on a marketing outlay, or a CEO that doesn’t want to release a new product without all the features ready. While we may be able to come up with general guidelines for the specific problems I outlined, there’s no clear cut method to best combat indecisiveness or to efficiently comb through endless information to determine which of it is most important across all fields and problems. Furthermore, we live in an era where we’re constantly tempted to endlessly research problems on Google and mine for more information until we’re absolutely satisfied with our decision.

The blog has a great piece on the science behind why this overthinking utterly eliminates our productivity. They write that “Psychologist Barry Schwartz coined the phrase ‘Paradox of Choice’ to describe his consistent findings that, while increased choice allows us to achieve objectively better results, it also leads to greater anxiety, indecision, paralysis, and dissatisfaction.”

paradox-of-choice article by Becky Kane

The best we can do is realize that a decision must be made and inaction often yields the worst outcome. Set a deadline for yourself for the absolute final time you need to make a decision by and propel yourself towards it with assistance from your team. If you have several options you need to weigh, quickly put together an estimate for when each of these options will inevitably be off the table. It’s a wise move to start your decision making process by dividing your information into two groups: what’s necessary now and what’s necessary later. People are often sidetracked by “what ifs” and grandiose game theory scenarios that are unlikely tangents to your choices.

Stay focused on your main objective and happy decision making!

Please leave a comment about any decision-making strategies you use and recommend!

{ 3 comments… add one }

  • Vivian April 28, 2016, 6:43 am

    This seems to me to come from perfectionism, wanting to get it right by having all the information to make the best decision possible. Personally, when I begin to see that I am pulled this way and that way with all the options, I choose to narrow the scope of the project and just get going. I figure I will always find a way to incorporate any new/more relevant information later. I like to think of it as my ITM–Implement, Tweak, Measure–mantra.

  • Edward Zeiden April 29, 2016, 8:42 am

    Thanks for the great tips, Vivian!

  • Vivian April 30, 2016, 8:00 am

    No..thank you for writing about this!


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