Dale the plumber is sure his customers pick him because he’s cheap. It’s why he hasn’t raised his prices in four years. There’s just one thing: he’s never asked any of them. So he makes three calls, and not one customer mentions price.

In this episode: why we grab the first explanation and stop looking (Richard Rumelt calls it “quick closure”); why your edge is a hypothesis, a strong guess you test before you bet on it; three simple tests (ask, look at your losses, and the copy test); and why testing your own theory is so hard: optimism, sunk cost and friends who love you but aren’t your market.

The Pause: Before you commit more money, more months or more of your heart, ask: what would I need to see to know I’m wrong? Write it down and date it.

Try this week, three calls: Call two people who chose you and one who didn’t. Ask why they chose you, who else they considered, and what almost made them go elsewhere. Write down their exact words.

Further reading:

• Richard Rumelt, Good Strategy/Bad Strategy (2011), Chapters 16 and 17
• Richard Rumelt, The Crux: How Leaders Become Strategists (2022)
• John Kay and Mervyn King, Radical Uncertainty: Decision-Making Beyond the Numbers (2020)

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Read the weekly notes: read.mystrategysquad.com

Watch Play-by-Play on Twitch: twitch.tv/mystrategysquad

Website: mystrategysquad.com

Strategizing Skills without the Suits.