“I felt like I was in the house, the house was on fire, and I had to rebuild it while it burnt down,” Airbnb Co-Founder and CEO Brian Chesky shares on a recent episode of Recode Decode. “It was harrowing.”
This March, three-quarters of Airbnb’s business evaporated. Saddled with over $1 billion of cancellations, Chesky was pressured to decide between siding with the hosts (guests lose money in refunds) or siding with the guests (hosts lose income). He wanted to do what was “right.” Everything felt wrong.
It’s a sense of paralysis many of us can relate to. Questions like when to go back to the office, how to parent kids this summer, how to expand your bubble, and whether to leave the city weigh heavy as we, like Chesky, yearn to do or say the “right” thing.
Only problem: There are no “right” solutions to life’s most complicated problems. There isn’t a definitively “right” thing to say. There never has been. That isn’t a loss, it’s an opportunity to anchor your action in values.
“I felt stuck until I realized we couldn’t side with the guests or the hosts,” Chesky continues. “Instead, I needed to side with health and safety.”
When making seemingly impossible calls, leaders cannot focus on identifying solutions that are definitively “correct.” Instead, we should hone in on our values.
“The principal I held was, this is a health crisis. It's a pandemic. Millions of lives are at risk. And we need to be on the right side of history,” Chesky explains. “When we had a board meeting at the beginning of the crisis, I wrote down a series of principles that would guide our decisions: We're going to be decisive, we're going to preserve cash, and we're going to act with everyone in mind. We don't want to be villains in crisis, we want to be on the right side of this issue, and we're going to play to win the travel season.”
These principles are examples of what Amy Edmondson, Novartis Professor of Leadership and Management at the Harvard Business School, refers to as decision-guiding values.
“These are not traits like kindness that everyone agrees with,” she explains. “They’re principles you’re willing to make a tradeoff for, or put a stake in the ground to uphold.” Decision-guiding values like Chesky’s — health and safety, be decisive, don’t alienate any customer base — force leaders to take action. (Exercises like this one from UC Davis help you identify the values you are most committed to making decisions based on.)
From his values, Chesky developed a four-step plan: Manage stakeholders, cut costs, raise money, and diversify Airbnb’s business. Each of these solutions would hurt some people, or be “wrong” in some ways — be it the 1,900 employees he let go, or the decision to prioritize guest refunds before financially assisting hosts. Chesky deemed the risk of being judged by others acceptable, so long as his decision-guiding values aligned with Airbnb’s mission: to foster human connection and bring people together.
He was right. Today, Airbnb’s virtual experiences are doing better than ever, their host relief fund raised over $17 million, all guests have been offered refunds, and Chesky has emerged a role model for humane layoffs.
Airbnb is exceptional in every sense of the word. But even if you’re not leading a multi-billion dollar enterprise, there is still value to extract from Chesky’s approach to decision-making.
“Whenever you’re experiencing great uncertainty, values are the only guidance system you can rely on,” says Edmondson. “You cannot predict the outcomes of your actions, so there is no universally ‘right’ solution. You have to clearly establish a small set of values that resonate with your team and customers, then make each decision in accordance with those values. In doing so, you will stay as close as possible to doing the ‘right’ thing for you.”
This approach to decision making should expand beyond pandemic leadership, and it ought to resonate in the present. There is never a “right time” or universally “right answer” for any major choice — whether to quit a job, change your career, enter a relationship, have a kid, move, or any other major life pivot. Sustainable success requires realizing that every decision has tradeoffs, whether you see them or not. By guiding your actions based on core values, you empower yourself to defend your tradeoffs, while inspiring those around you to lead with intentionality.
Published June 1, 2020