Lessons in leadership and decision making for engineers

There’s art and science to making the right business decisions. Two entrepreneurs who helped build billion-dollar companies shared their secrets at Stanford School of Engineering.

When it comes time to build a startup, engineering and computer science graduates from top-flight universities aren’t likely to stumble over the technical aspects. But the softer skills needed to run a company – leadership, management and decision making – aren’t in everyone’s skill set.

At a recent forum at Stanford School of Engineering, two well-known Silicon Valley entrepreneurs – Mike Krieger, the co-founder of Instagram, and Roelof Botha, the first CFO of PayPal and now a partner at Sequoia Capital – shared their thoughts on the art and science of decision making.

“Making smart decisions will determine whether you fulfill or fall short of your incredible potential. Take chances, take calculated risks. You won’t achieve the success you dream of if you make a series of safe choices,” Botha said.

Early in his career, Botha had a critical decision to make: Take a high-paying job at McKinsey & Company or join PayPal, then just a startup. As he struggled to make the right choice, he took steps that he now recommends when faced with a tough decision: “Seek advice and do research.” In Botha’s case, the advice came from the classmate who later became his wife, and his research took the form of a paper about PayPal’s chances of success that he wrote for a class.

Decision making, said Botha, is physically taxing, like an Olympic sport, “so save your energy for the finals.” And don’t make important decisions when you’re tired or stressed. Botha learned that lesson the hard way. He decided to skip a meeting with Twitter because he was fatigued and upset and lost a chance to become an early-stage investor.

Although working in teams is very popular in Silicon Valley, Krieger said he gets nervous when they grow to more than a handful. “Every person you add makes decision making more complex. Yes, they bring more expertise to the table, but the amount of time spent ‘driving alignment’ is one of the reasons large companies move so slowly,” he said.

Krieger added, “Problem solving and decision making go hand in hand. If you have to make a choice between two things and neither feels right, it means you probably haven’t solved the problem.”

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