Why are managers abdicating their decision making to teams?
Introduction to SignalsFromTheOP
Guide to episode
- CEB's 6.8 member buying team frustrates complex sales, but is just a symptom of a larger consensus decision making trend
- Consensus decision making is a failing approach
- It's difficult to achieve consensus because of so many conflicting priorities - often selfish ones
- Certainly managers should seek and consider input from key stakeholders - but then make and own a decision, not seek consensus
- Not only does this approach paralyze important decisions and initiatives, but it gives companies a false sense of confidence that they have a thoughtful, robust process in place
Transcript follows
Hi, I'm Ed Marsh. Welcome to this episode of Signals from the OP. If you know signals, you know that I tackle topics that aren't necessarily always discussed in polite company. Today we're going to tackle one that may really may needle a couple of folks. We're going to start with this big number, I'm sure you've heard it, 6.8. Probably familiar with it, it's what CEB says statistically is the number of people that are typically involved in the buying team for a complex B to B purchase. You've also seen, we've talked about it before, and I've heard from many companies, the status quo is winning more deals. And I believe that's happening precisely because of this process of large buying teams and consensus decision making.
6.8 people. Seven people. Everyone has to say yes. Anyone can say no. How can we, as B to B salespeople in a complex sales environment, possibly manage that? That's the discussion that I have with a lot of companies about how to use marketing and sales, and digital tools, and alignment, and sales enablement, and different processes, and a number of the techniques that we can use, including buyer intent data to try to understand what's happening with these teams, but it's a problem. And it's a problem for more than just companies that are trying to sell.
The reality is, welcome to today's enlightened world of consensus decision making where CEO's and managers are afraid that folks are gonna blame them for bad results and bad outcomes, and so they just don't make decisions. They leave it up to the gang. Leave it up to the crowd. Oh, you know, we all decided together. We all felt good about the decision. We'll learn from it next time.
This translates into some amazing situations. And amazing, I'm using as a euphemism, there's other terms that I could think of it. For example, I've seen the IT department in a middle market company. The IT department in this case, has unable to get an ERP upgrade done over the course of three years. They had all the users of the company's computer systems locked out because they fell prey to a ransom-ware attack. So this IT group, that has failed in some of these core IT functions, sat at the conference table as a part of a consensus decision making management team, evaluating the sales and marketing department's plan to launch a new website using a new CMS. And the IT department shut the project down because they had created a home-grown CMS that they thought was better for a variety of reasons. I mean, what? How do you rationalize that?
The reality, further, is that even if you don't have that kind of an egregious track record of failure among one of those stakeholders of that meeting, some people just don't make good choices. They don't have a good track record of success. They can certainly be heard. They may have perspectives that are worth considering, but it's absurd to weigh their opinions the same as others who have significant, continuous, and substantial records of success. I mean, it just doesn't even make sense that they would have the same vote.
Further, some decisions, and you might even say many decisions are gonna ultimately be bad for some department or some group of people. You want to increase marketing, then guess what? It's probably gonna come at a cost to the sales department budget. You want to reduce turnover? You may have to reduce your recruiting spend and boost spending on resources focused on training and retention and that's gonna mean that different people in the HR department end up aligned in different ways, doing things they may not like, compared to what they were hired to do.
And yet, we find that so often with these teams, this consensus decision making process, opinions are actually driving it. Whether it's subconsciously or not, opinions are driving the outcome for the company. It's based on the impact on individuals in departments, not what's best for the company.
All right, let me be clear. I'm not saying the CEO ought to just willy-nilly issue edicts, you know coming off the golf course late in the afternoon dripping with sweat, dictate a memo and change the way a company does business. Not at all. They have teams of executive managers, they have different skill sets, different perspectives, that should sit at the table and contribute input toward decisions. And that's true within departments as well.
However, that's very different than making the decision. So, contributing to it, offering insights, offering the recommendation, making a suggestion about the best way to proceed, are different than saying, "Oh, you know what? That's what we're gonna do." More and more I see companies that are mired in mediocrity. The status quo is running businesses. Because the teams just don't have the ability or perspective to make a kind of management decision. It's even worse than that though. As decisions are devolved to these teams, companies now actually tend to feel, I've seen in many cases, very self satisfied that they've got this rigorous, thoughtful, engaging approach by which they analyze tough issues and make good consensus decisions. All they're doing is just devolving to the median. They don't make decisions, because it's almost impossible to get seven people lined up or on the same thing, when they've got these selfish interests that are often in conflict. So it's a form of paralysis.
So bottom line, you've gotta make proactive decisions in business today. There's so many big changes looming with disruption, you have to be willing to make some bets. Take some risks. Look for some alpha. Don't bet the company, hedge those risks I've talked about earlier, but that requires proactive, bold decision making. And it's not the kind of thing that groups are able to do. They just don't have the vision. And their focused on again, competing priorities. Don't let the status quo manage your business.
All right. So I've poked at a few accepted management tenets here today, maybe a little more aggressively than I often do, but this is exactly the kind of thing that I do on this periodic video blog, Signals from the OP. If you like it, if you think it's got some value, if it's stimulating some thought, I'd welcome you to subscribe. You can do that at SignalsfromtheOP.com. That's SignalsfromtheOP.com. I'm Ed Marsh. Thanks for letting me poke at you a little bit today.
