A global expert on strategy and execution in turbulent markets, Dr. Donald Sull is a Senior Lecturer in the Technological Innovation, Entrepreneurship, and Strategic Management group at the MIT Sloan School of Management, where he teaches courses on Competitive Strategy and Strategy Execution in Volatile Markets. His recent book, Simple Rules: How to Thrive in a Complex World is a great summer read. Don will be in an upcoming Business901 podcast. Below is an excerpt from the podcast.
Joe: What I took from the book is that you actually group rules. Was that done on purpose? Is there some truth to that?
Don: I think there’s some truth to it. On purpose, I mean when we started this project 15 years ago, you know, we didn’t have a strong sense of, you know, we didn’t have a strong theory or strong biases to how the rules would sort out. One of the things that was interesting is we studied rules and creative domains like Elmore Leonard’s rules for writing a book and Tina Fey’s rules for producing 30 Rock and then social biology, how bees find a new nest and how ants coordinate their activities and, you know, monetary policy, how the Federal Reserve uses simple rules to set policy.
What was interesting is we’ve studied the rules, simple rules across these different domains is that these 6 categories of rules emerged. What we learned are that basically 3 types of rules that are around decision-making. The first one is boundary rules, what’s in and out. Examples of this would be the rules that doctors use to diagnose the celiac disease for instance. They use a set of simple rules, you’re either diagnosed with the disease or without it. The second set of rules is prioritizing rules. These would rules like the rules that Darfus uses to decide how much money to give to specific projects. The third set of decision rules is around stopping rules when you decide to stop doing things.
It turns out, we’ve had this, Mt. Everest has been in the news with this tragedy over the past couple of days. Up to today, one of the most fatal days for climbers on Mt. Everest was caused because the climbers, a group of 16 climbers ascended the summit and they ignored what was called the 2 O’clock rule which basically said if you’re not at the peak by 2 o’clock you turn down no matter what because it’s very dangerous to descend as the weather turns and as it gets dark. A group of climbers, about 2 o’clock, they’re a couple of hundred yards away from the summit. They started arguing with the guide. The guide ignored his own rule. They climbed, hit the summit about 345 and it turns out that the delay of an hour and 45 minutes was fatal for five of the climbers. That 2 o’clock rule is an example of stop and will help to remind us when to stop doing something.
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