"The wise person does at once what the fool does at last." Baltasar Gracian.

Unlike most of my articles, the current topic of firestorms has become an issue in my personal life. This gives me the opportunity to observe how people make bad strategic decisions in real life.

In discussing firestorms more generally, that is, situations where changes in the environment threaten our strategic positions, we must discuss the need for speed. Firestorms move fast. The environment and its laws cannot be reasoned with or ignored. When events threaten, we must respond instantly if we want to save ourselves from getting burnt. We must respond immediately or pay the price of losing what we need most.

The Problem of Delay

What are the reactions of most people when they find themselves in a firestorm?

They react with denial. Firestorms are uncommon, a big change. Initially, people deny there is really a fire or the danger of fire. When they are forced to admit that the danger is real, they deny that their positions are threatened. They imagine all kinds of reasons why they will be immune. When it is clear that they really are threatened, they want to believe that there is a painless way to escape by careful planning. As they waste their time planning, their positions start burning down.

Though we usually talk about firestorms in the context of social situations, a good illustration from nature is useful here. A hurricane is seen out at sea. At first, many don’t believe that it is coming ashore. When forecasts predict it will land, many don’t believe the forecasters. As the forecast starts coming true, people are still in denial about it hitting their areas. As the prediction, narrows and narrows, they remain in denial. And when they have to admit that they must do something, they start studying their options, but because of their delay, they have few options left.

Of course, this delay has huge costs. The firestorm itself causes prices to climb. When firestorms threaten, people start to compete what is needed to protect themselves. The cost of those resources climbs. Many of those resources simply disappear. Didn’t get plywood to protect your windows early? If you are lucky, you pay through the nose. If you are unlucky, you kiss your windows goodbye. Didn’t evacuate until the last minute? Hotel rooms are going to cost a fortune. Or, as often happens, your family is sleeping in the car.

In strategy, we are not executing a plan, but adapting to events as quickly as possible. Strategy is how we respond to uncertainty, making fast decisions. We don't execute plans. There is too much we don’t know and can’t control. Instead, we must act on the few things in the future that we can know for certain. When dealing with the potential firestorms, one of the few things that we can know is that the longer we delay, the more danger we are in and the more it will cost to protect ourselves. These should be powerful incentives to act quickly. Still, the fear of change and the fear of making wrong decisions paralyzes people.

A Real Life, Real-Time Example

I am writing this article because of a firestorm in my own area. Events are currently unfolding in this firestorm, so this is as much reporting as analysis.

We live in Las Vegas, where water shortages have forced the state to pass a law against “useless grass.” Not the kind you smoke, which is perfectly legal, but the kind you have to water. Home Owners Associations (HOAs) with residential grass must remove it and replace it with “desert landscaping,” a euphemism for rock.

The board of our HOA started working on this a the beginning of the year 2022. But soon after they began, opposition arose. People wanted to keep their grass because it makes our area more attractive than most ofLas Vegas, which already has desert landscaping. This opposition has gone through the first three stages of grief. First, they were in denial, denying that the law was real and that it applied to our HOA. Then came the anger, attacking the HOA board, and the Southern Nevada Water Administration, accusing them of all types of dishonest behavior. Now, they are in the bargaining stage, where they want to set the terms for the conversion, mostly for the purposes of slowing it down.

The main effect has been to delay the project. This delay is dramatically raising costs. Every HOA like ours has to do a conversion, but there are a limited number of companies doing big projects like ours, a hundred homes. So the increase in demand and limitations of supply are raising prices quickly, much faster than than the crazy inflation rate. Demand is so great, that even getting estimates from suppliers is difficult. One report said that the price of rock when up 30% between January to April. The prices of fuel and transportation has gone through the roof. What might have cost $2,000 per household a the beginning of the year, probably will now cost at least $4,000 per household. Experts hired by the opposition are estimating $6,000. At some point soon, the financial rebates for conversion offered by the state will run out. This will instantly raise the costs another $2,000 per home.

The sad part of this is that I live in a retirement community where many people live on a fixed income. They would have had trouble paying the original $2,000 instead of the $10,000 it could end up costing them. They may have hoped to avoid the $2,000, but the only result is going to be that they end up paying a lot more. None of this even takes into account the fast-rising costs of watering all these thousands of square feet of lawn.

The water crisis is not easing. Already, the federal government has told the state it must cut water usage another 8% next year. It is only a matter of time until useless grass is forbidden for private homes, further increasing the competition and costs of conversion. And, of course, after the incentive carrots are gone, the state will start using its sticks. I expect fines for all those laggards who are late doing their conversions.

The HOA board is more focused on their opponents’ answering misleading claims than on their mission. The board has gotten lost in the weeds. They don’t understand that critics can come up with an unlimited number of reasons not to act. They can always move the goalposts. Making more impossible claims about the future. Any action can be delayed forever by the infinite number of possible hypothetical “what ifs” that make any action a bad decision. If the board is continually distracted by every new attack, no action will ever be taken.

This is a classic case of paralysis by analysis. Meanwhile, the clock is ticking and prices are going up. The first $2,000 of cost was forced on them by the state. The additional cost of delay was caused by their critics. Now, all their critics’ original claims have been proven to be untrue. The increases from here on are a result of people’s fear of taking action.

Conclusions

What should the HOA board focus on instead of the claims of their critics? As always, they must focus on their mission. Instead of chasing after an infinite number of things that they can’t know about the future, they should focus on the few things that they can know for certain. They know they must obey the law. They know the water shortage isn’t going away and is likely to become worse. They know that delay is costly. They also know that, no matter what their decision, there will be plenty for others to criticize. No amount of analysis, placating, or handwringing can assure a perfect decision about an unknowable future.

The same is true for everyone caught up in a firestorm. Act quickly. Ignore your fears, doubts, and criticisms. Act based on the few things that you can know for certain about the future.

Practical Strategy Based on Sun Tzu's Art of War

Firestorms: The Danger of Delay