Much of the management advice we find in books emphasizes using leadership tactics that may seem reasonably obvious. This advice is often easy to follow — but that’s not where leaders run into issues with their strategy, argues Ben Horowitz, founding partner at the venture capital firm Andreessen Horowitz and author of the best-selling book, “The Hard Thing About Hard Things.”

Horowitz says that leaders make blunders when they find themselves in highly emotionally charged situations where the emotion prevents them from doing the thing that they intellectually know they need to do. For example, firing a friend or doing a reorganization that causes a very talented employee to lose power. These things are much more difficult, and people often avoid them. But as a leader, you’re much better off running at your fear than running away from your fear because it’s going to chase you down, emphasizes Horowitz.

‘Management debt’ is what happens when you don’t do what you’re supposed to. And accruing a lot of management debt has a cascading effect that can create a total degradation of your organization. Here’s how to lead instead.

Ben Horowitz: A lot of management books emphasize things that are, like, reasonably obvious. How do you do goals and objectives and OKRs and mission statements and delegation, things that you need, like, a mildly good eighth-grade education to do. But that's not where people run into trouble. They really run into trouble on, like, very, very complicated emotional things where the emotion prevents them from doing the thing that they intellectually know they need to do. So this could be firing a friend or doing a reorganization that causes a very talented employee to lose power and get upset with you or not give somebody a raise who you really like but isn't the person on the team that deserves a raise. These things are much more difficult, and people often avoid them. But as a leader, you're much better off running at your fear than running away from your fear because it's going to chase you down.

Hello. I'm Ben Horowitz, founding partner at the venture capital firm Andreessen Horowitz and author of the best-selling book, "The Hard Thing About Hard Things." Management debt is what happens when you don't do what you're supposed to. I should fire that person, but that's going to be very, very messy, so I'm going to blow it off. I should fill this executive position, but I'm oh so busy with other things, so I'm going to let that go. And the problem is that debt causes knock-on effects. So you don't just have the problem of the bad executive or bad manager that you didn't fire. Now that debt creates an employee satisfaction problem among everybody on that team. And then the reputation of that team starts to degrade inside the organization, and so now that team can't be effective with other teams. And then you start to have attrition on that team because nobody wants to work in an organization with a bad manager that nobody else in the organization respects. These things cascade, and pretty soon, it's very, very difficult to kind of get out from under it. So it's why I always like to say, you know, you need to run towards the pain and darkness and not away from it. And I think the best leaders always run towards the darkness. They always run towards a problem. They never run away from it. And the ones that fail, you know, always hesitate.

In peacetime, a business has a product that's working. Customers love it. There's not really serious competition. There's plenty of money in the bank. And so what you're really trying to do is say, "Okay. How can I take this great opportunity that I have and scale it up? How can, you know, enable the organization to do more and do it without me kind of getting in the way and slowing it down?" And so most management techniques are oriented around this. But in a wartime situation, there's a 10x change in the competition, the supply chain, the financial and macroeconomic environment. And in this scenario, those techniques have to be changed very rapidly, and you can't have a peacetime persona as a leader.

An example, you know, I was on the board of a company that had lost a huge portion of their revenue during COVID. And in the board meeting, the proposal from the HR department was, "Gee, because we lost so much revenue, the stock dropped, you know, in half. Therefore, the offers that we made to employees were worth half what they were worth, and so we have to give all the employees more stock." And that was a very peacetime idea. Keep everybody in the boat. We have to retain people, et cetera. But we're in wartime now. And what I told the CEO is, "Look, you're trying to keep everybody in the boat because that's what you told your team to do, keep everybody in the boat. But your boat is leaking, and it's three thousand miles from shore, and you're never going to make it to shore if everybody stays in the boat. So the last thing you want to do is keep everybody in the boat. You need to start throwing people overboard. If they want to jump, that's awesome. The last thing you want to do is give everybody more stock options. Like, maybe there's a few people that you got to have, but other than that, you got to let them go. This is war. This is no longer peacetime."

When you're reading a case study about a business, you know everything because it's over, and you're looking backwards through history. And so it's very easy to make those decisions in retrospect. But when you're going forward in time, you have less than complete information, often less than ten percent of the data that you would like to have. And then employees or people from the outside, the board, the customers, the public, the press, think that they know the decision. None of them have as much information as you or as much context as you. So it takes courage to do what you don't know is the right decision, you think it's the right decision, and then many people think it's the wrong decision, so they're not going to like you when you make the decision. That's the point at which leaders add value. Because if you just do what people want, you're not actually adding anything. You know, they could run the company without you.

Courage is a tricky thing. You know, I think my favorite quote on this is from the great boxing trainer, Cus D'amato. He trained Floyd Patterson and Mike Tyson. And he said, look, "The difference between a hero and a coward isn't what they feel. They're both scared. It's what they do." You're not going to feel confident in making decision that you think is fifty-two percent right and everybody else thinks is wrong, but that's what you have to do to be good at this job. The thing you have to keep in mind is you want to be liked and respected in the long run, not the short run.