The Cost of Being Right: Why decisions made at 70% information beat slow certainty
👋🏻 Hello growth seekers,
In 1987, Ken Iverson approved a steel plant that nobody in the world had built yet. The thin slab casting technology came from the German engineering firm SMS Schloemann-Siemag, it had run in a pilot setting, and its commercial behaviour was an open question. Nucor committed roughly 265 million dollars to it and broke ground in Crawfordsville, Indiana, at a company small enough that a failure would have taken the whole business down with it. Iverson described the choice without drama. He did not know it would work. He knew that waiting for proof meant handing the answer, and the market, to somebody else. The plant started up in 1989 and reset the economics of flat rolled steel across North America.
📊 The sixty percent rule
Iverson organised his entire approach around a figure that would unsettle most boards. His stated goal was to get the decision right about sixty percent of the time. The remaining forty percent carried no shame in his accounting. It was the standing cost of working in conditions where complete information shows up only after the window has closed.
That number does something useful to a leadership team. Once the error rate is treated as structural, the competitive question stops being "how do we avoid being wrong" and becomes "how quickly can we detect it and correct". Iverson was blunt about the trade. Every additional week spent building confidence is a week the competitor spends building capacity, a week the market spends changing shape, a week your team spends losing the energy that makes execution possible. Certainty is purchasable. The invoice arrives in the form of relevance.
🧭 Decisions belong where the information lives
The sixty percent rule only functions if decisions sit close to the facts, and Iverson engineered the company accordingly. Nucor ran with four management layers between the chief executive and a worker on the mill floor. Head office was around two dozen people on a rented floor in Charlotte. Division general managers ran their plants as their own businesses, with the authority to commit real money without a committee in another state weighing in.
The design rests on a simple observation about people at work. Anyone who expects to be judged purely on the outcome will hedge, delay, and build a paper trail. Anyone who trusts how the organisation responds to a wrong call will move while the information is still worth something. Iverson made that response explicit: make the decision, and if it turns out badly, we will help you fix it. What looks like a tolerance for error is really a piece of infrastructure. It converts fear into speed, and it produces leaders who stay open to what the data is actually saying rather than to what they announced last quarter.
🔩 Speed runs on credibility
None of this survives a leader whose words and behaviour drift apart. Iverson removed the signals that usually separate the people who decide from the people who deliver. No executive dining room, no reserved parking spaces, no corporate aircraft, the same insurance plan from the top of the company to the bottom, everyone in coach.
The test came in the downturns. Rather than cutting jobs, Nucor cut hours and pay across the organisation under a programme employees called Share the Pain. Production workers absorbed a reduction, division heads absorbed a larger one, and Iverson took the steepest cut of all, well over half his income in the worst years. That consistency is what allowed him to ask an entire workforce to back a plant that might not work. People extend trust to leaders whose stated values and lived choices match, and they withhold it, quietly and permanently, from those whose values apply only when the numbers cooperate.
Your next decision probably does not involve a quarter of a billion dollars of unproven technology. The underlying question is identical. What would it genuinely cost to be wrong here, how fast would you find out, and is the extra information you are waiting for worth the ground you lose while you wait for it?
Practical Tools
In this "Practical Tools" section, we’ve put together a set of resources to support your personal growth journey. Chosen for those keen to explore deeper and refine their leadership qualities, these tools are designed with genuine intention. Here, it’s all about taking meaningful steps towards personal betterment. Let’s begin!
🕰 Put a price on the wait
Most teams quantify the risk of acting and leave the cost of delay as a feeling. Reverse it. Before your next significant call, write down what one more week of analysis actually costs: the capacity a competitor adds, the hiring window that closes, the momentum your team loses each time a decision is deferred to the following meeting. Make it a line item with a number next to it, however rough. Once delay appears on the same page as risk, the conversation changes shape in about ten minutes, and the 70 percent threshold stops sounding reckless.
🔎 Name the tripwire before you commit
Iverson's tolerance for a forty percent error rate worked because errors surfaced early. Replicate the mechanism. For every decision made on partial information, agree in advance on one observable signal, one date, and one person with standing authority to raise the flag. Write it down in the same document as the decision itself. A team that knows exactly what would prove the choice wrong argues less about whether it is wrong, and starts correcting weeks earlier.
🪑 Audit your asymmetries
List the things your role gets that your team does not: the flexibility, the information, the protection when a call goes badly. Some are legitimate. Several are habits nobody has examined. Iverson took the deepest pay cut in the company precisely when he was asking everyone to absorb one, and that record is what let him ask a workforce to back an unproven plant. Ask your team directly which asymmetry they notice most. Their answer tells you how much speed your credibility can currently buy.
Food For Thought
Welcome to the "Food for Thought" section, your gateway to a curated selection of resources that will nourish your curiosity and inspire your creative journey. In this corner of Growth Republic, we bring a collection of insightful resources that you can look for on the web, from thought-provoking podcasts or books, to illuminating online articles that can expand your horizons and deepen your understanding of the topics we explore. Consider it your intellectual pantry, stocked with ingredients to feed your mind, and ignite your creativity. Dive into these resources and let the feast of knowledge begin.
📘 Book: Plain Talk: Lessons from a Business Maverick, Ken Iverson, Wiley, 1997. Iverson's own account of running Nucor with four management layers, a headquarters of twenty two people and an explicit tolerance for getting decisions wrong. Short, blunt, and closer to a field manual than a memoir.
📄 Primary source: Amazon's 2016 letter to shareholders. The origin of the 70 percent rule and of the distinction between reversible and irreversible calls. Worth reading in full rather than in the version that circulates on LinkedIn, because the argument hinges on the sentence most people skip: you also have to be good at recognising and correcting bad decisions quickly.
📈 Article: Three keys to faster, better decisions, McKinsey Quarterly, May 2019. Survey evidence from more than 1,200 managers on why decisions stall, plus a practical way to sort big bets, cross cutting calls and delegated choices into different processes instead of one committee.
🎧 Podcast: How to Make Better Decisions Under Pressure, HBR IdeaCast, January 2025. Carol Kauffman on what happens to judgement when the stakes rise and the clock runs, and how leaders can widen their options in the moment rather than after the fact.
Quote of the Week
«My goal is to make the right decision about 60% of the time.» - Ken Iverson
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