Vijay Kumar.

Note three

Your plan is a straight line. Your company is a loop.

Spreadsheets add. Companies feed back. Almost every operating surprise lives in the gap between those two facts.

Open any operating plan and you will find the same shape. Inputs on the left, a growth rate in the middle, outputs on the right. Every arrow points one way.

No real company has ever worked like that.

What a loop looks like

You raise prices. Revenue per account goes up, which was the point. Churn in the smallest segment goes up too. Smaller accounts were cheap to serve, so losing them raises your average cost to serve. Higher cost to serve compresses the margin the price rise was meant to create. Six quarters later you have the same margin, fewer customers, and a worse referral base.

Nothing in that chain is exotic. Every link is the kind of relationship an experienced operator would nod at. But a plan built as a line can only hold the first link, because the first link is the only one where the arrow points the way the spreadsheet does.

Why one hop is the default

It is not ignorance. It is that modelling the second hop requires you to write down a relationship you have never been asked to write down — how much does cost to serve actually move when segment mix shifts? Nobody knows, so nobody writes it, so the model silently assumes the answer is zero. Assuming zero is a decision. It is just an invisible one.

The practical version

You do not need a simulation to get most of the benefit here. You need a habit: for every decision, say out loud what it changes, then what that changes, then what that changes. Three hops. Stop there.

Most of the time hop three is nothing and you move on in ninety seconds. Occasionally hop three is where the whole thesis dies, and you have found it before the market did. That asymmetry is the entire argument for doing it.

One of five short notes on why decisions miss. Back to the others, or tell me where I'm wrong.