Multiple perspectives produce a better understanding of any situation

Raymond Hill - Tuesday, June 19, 2018

Business decision-making is a tough go. In many cases, it’s a lonely process. Owners often have no one to talk to. Executives don’t want to bother their owners, don’t want the owner to know about their uncertainty or don’t want the owner meddling in their kingdom. This conundrum cascades through all levels of the company. So let’s talk about improving decision-making.

Use a consultant: As consultants, we fully endorse this self-serving course of action. Some thoughts on consultants:
Consultants can often provide objective recommendations that leverage their experience with other companies, in similar situations. Ideally their experience would be with companies in the same industry as the client’s. While there are some similarities between all businesses, we think industry specialization can often improve the applicability of a consultant’s recommendations. Selling toilets, pipe and fittings or air conditioners is just different than selling shoes, food or clothing.
From the beginning of our lives we learn through trial and error. We try a couple steps, fall down and get up. We repeat the process until we achieve our objective, hopefully with adjustments to each iteration in how we took the steps. Fortunately, our parents keep us away from stairways, cliffs, open windows, etc as we are making our attempts. In business, some use the same approach for learning, making lots of, sometimes costly, mistakes along the way. Others have mentors, coaches and consultants so they are not wasting time reinventing the wheel. Ideally, they can make faster progress, with fewer mistakes and reduced risk of walking off a cliff.
Consultants are a good source of second opinions  We are big fans of second opinions when there are serious medical or business challenges in life.
Consultants almost always tell you things you already know  Consultants are mortal. We’ve met a couple who seem to think otherwise of themselves, but last we checked, we are all mortal. Seldom will a consultant offer up an earth shattering type suggestion; but they may confirm your suspicions and offer new ideas and new approaches.
As we consult, we operate with 3 basics rules:
  1. Family comes first – we work with a lot of family-owned companies. We think that the family relationships must not be harmed by the operation of the company. Most family companies start out that way but the concept gets lost in the heat of battle, the fog of war and ego trips that can occur in business.
  2. Deal in facts – As we work through issues with clients, there is often considerable uncertainty about the facts. So considerable effort must be applied to developing a clear picture of the situation at hand by gathering and crunching data and information. In some cases, this clarity exposes the fact that the company has been working on the wrong problem. (One of our favorite misdirected corporate projects is a new computer system. The company has an old system and thinks that a shiny new system will somehow resolve the bad management, the sub-standard team and bad customer service. For the record, we have never seen a new computer cure these ills. We don’t count the times where the cost and distraction of the new computer put the company into such a financial tailspin that the company needed to be sold with the new owners bringing in a new team to fix the problems, it would be too depressing.)
  3. Don’t kid yourself – In many cases, there is the proverbial elephant in the room, and for whatever reason people don’t want to deal with that elephant. It’s embarrassing, it’s painful, it’s too difficult, it’s beyond our capacity, etc. So we pretend it is not there, and the problem doesn’t get resolved.
  • You probably already know the answer
  • Is your inaction because you don’t know the answer
  • Or you don’t want to do what that requires?
Of course, as always, the devil is in the details of these rules, so here are some additional thoughts on the details:
Multiple perspectives produce a better understanding of any situation  The person standing in front of an elephant has a far different understanding of the operation of the animal compared to the person standing to the side of an elephant. The person standing behind the elephant has quite another perspective that includes different visual and olfactory understandings of the beast. If you have a sick elephant, it is critical to look at the situation from all sides then craft your plan of attack.
One set of eyes does not always produce comprehensive information leading to sub-optimal decisions  As a client once described a member of his team, “You can count on him to approach every situation with uncompromising self-interest.” In some situations where only one data source exists, you are forced to use that source or viewpoint while somehow factoring the information to remove any known or expected biases. This is a tricky process. Plus an individual may have unanticipated biases that you don’t know about and thus cannot adjust for.  Multiple sets of eyes produce a more diverse and balanced view of any situation In making business decisions, a well-rounded understanding often produces better decisions. When we want the best possible understanding of a situation, we try to talk to a lot of people, at a lot of levels, in a variety of roles, in multiple locations. The idea is to have as many diverse points of view as possible so as to reduce the bias from any person or group in the company. It is certainly not a perfect process but it seems to produce the best possible results in our experience.

Don’t confuse conviction with accuracy  As another client described one of his team, “He is always 100 percent certain and sometimes he is correct.” Years ago a study was conducted about how smart and dumb people conduct themselves in life situations. The study indicated that folks espousing incorrect data often did so with the same level of certainty, commitment and sincerity as people with correct data. Rich is reminded of a distant family member who came to visit when Rich lived in Dubuque, Iowa on the banks of the mighty Mississippi River. The family took a picnic lunch to a bluff high above the river where they could look out and get a small sense of what a “mighty” river it really was. As they were discussing the view, the visitor mentioned that the river flowed from south to north. As proof, she pointed to the huge amount of water in the river and stated that the only place where you could get that much water was the Gulf of Mexico. Even after much discussion, she remained certain of her “facts” and her original statement.

Pretending or ignoring a problem doesn’t make it go away  Some things probably do go away if you ignore them, but most problems in our industry seem to stay, often getting worse as you do not attend to them. One CEO admitted that he was so overwhelmed with problems that he had steel heel clips attached to his shoes. As he walked, the clips made a clicking sound almost like a tap dancer’s shoe. People in the company could hear him coming down the aisle from a mile away and thus had lots of warning to get “posed” for the picture he would see. The CEO’s excuse was, “If I see something bad, I have to address it and my plate is already full with life and death problems that must be my focus.”

Eating the elephant one bite at a time  Eating that elephant all at once is not possible. Similarly, needed changes are delayed or abandoned because they are or at least seem to be overwhelming. We always start with a prioritized punch list of tasks in any recommendation we make. Our description often starts with: “If you can only do one thing, item number one is what you should do. Then as time and energy allows, take the next bite, Item number two.” We have seen management teams consumed as they attack their entire list of problems at once. Sadly at the end of the month, they have 20 tasks 10 pecent completed instead of one task completed allowing the company to enjoy the benefits of that completed task. (In some cases, we have suspected that the team didn’t really want to change anything and the diluted approach produced good optics while keeping the status quo.)

Well, as we reread the column, we realize you might think it is about elephants and consults but it really is not. While we do like elephants and some consultants, it is about becoming your own consultant, using some of the techniques we use as consultants, finding out what your company’s or division’s or department’s problems are. Then getting the facts together needed to construct a prioritized plan of attack. Finally, attacking your punch list one task at a time.