Thursday, February 9, 2012

A thought on due diligence

The following was posted as a comment to the old Ning Mistake Bank site. It's part of that site's archive but I no longer know who wrote it. Whoever it was, they were pretty wise:

Several of the stories posted on the site are on lack of due diligence causing problems later. However, we rarely look back on situations where we did too much due diligence. What opportunities did we not take because we looked too closely at them? Might some of them turned out great? I think circumstances influence our level of due diligence, especially when we're self-employed. When you need that next gig, or really want to make a certain deal, our brains look at the bright side and muffle our skeptical side. Sometimes that causes us problems, and sometimes it turns out great.

By the way, if you were the person who posted it and would like attribution, I'm happy to give that to you. Post a comment and I'll get in touch with you.

...and after rereading this post, it occurs to me that a tool that addresses this is possible. Something like an "reverse due diligence" - looking at the absolute worst case outcome of a decision, and comparing it to the possible upside, as a rationale for going ahead with the decision.

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