How careful and how ruthless are we in our day-to-day business decision-making?
Do we take ‘reasonable care’ when we make decisions?
If not, we might be threatening our organisation’s insurance premiums.
After all, the shareholders and compliance authorities will want us to have acted competently, considering the options and assessing relative risks. They will want us to consult specialists where it is prudent to do so (i.e. when we don’t have all the knowledge that should be applied to the decision).
They may want us to demonstrate that we have followed a formal process at a reasonable level of detail. We may need to demonstrate that the decision-making process was fair (e.g. for recruitment or layoffs), resulted in affordable outcomes (e.g. for investments) and that plans are achievable (e.g. for new products, services and other strategic adventures).
According to Wikitionary’s definitions, being careful is about ensuring you are aware of the potentials dangers and / or that you have been conscientious in following the prescribed process.
So what is the problem with being careful with your decisions?
It can be slow. Getting all that information together on risks and issues. Having them assessed by experts so that the impacts are understood. Obtaining formal agreement to proceed even though we are adding risk to the business. It all takes time.
And how much value does it add?
Agile methods address the need for careful investment by breaking the project down into chunks, delivered in an iterative way, involving end users and customers in the evaluation of what is being created through the development process. This means that we can get started sooner and manage risk dynamically as we go along. This works well for developments that interact with people directly such as software applications and strategy.
So you can be careful with your strategy development without being slow if you adopt agile strategy design®.
“After 8 years in a job you will have done your best work because you will have built up too many friendships and allegiances to be ruthless enough to make the changes required,” (A recent quote from a senior leader in the education sector.)
Wikitionary says that ‘ruthless’ means acting without pity or compassion for others. It implies that we can act without considering the dangers and the impact on others.
I was talking to an Architect colleague recently. We got on to the topic of culture in the property development market. The word ruthless was used more than once. We discussed the phenomenon of a seemingly ruthless organisation. Yet one that may be staffed with people who individually care and are careful. But who operate a ruthless machine.
So, who is responsible for the behaviour of an organisation?
Is the degree of carefulness v ruthlessness exhibited by an organisation explicitly assessed, agreed and sanctioned by the Board? Or does it sit within the ‘culture’ where it is not explicit but may have a strong influence over behaviour?
- How does an organisation full of careful souls make ruthless decisions?
- What is the mechanism by which the need to be careful is set aside in favour of profit or a personal goal?
- Does the ‘cloak’ of a corporation enable directors and managers to hide their ruthless alter egos?
- Does a culture of ruthlessness suppress caring behaviours of individuals?
I explore the answers to these questions when reviewing governance frameworks as part of business decision design®.
Ruthless or Careful – Which is better for business?
I’m sure both add value. Possibly the degree to which either strategy is successful depends on the customers’ expectations of how we should behave.
Business decision design looks at culture and behaviours as well as frameworks and use cases. Our intention is to reduce risk and maximise profit opportunity as your business grows.
Is there a time to be ruthless as your company develops?
How much can you afford to care about the way you do business? To help you to understand how much to worry about this (or not) we ask:
- What constitutes ‘careful’ behaviour in your line of business?
- Have you considered suppliers and other stakeholders in this analysis?
- How important is this to your potential customers when they make their buying decisions?
- Do your suppliers have a choice of whom they prioritise for delivery?
- What constitutes ‘ruthless’ behaviour in your line of business?
- Is ruthlessness the ‘norm’ or counter-cultural? How does it impact your bottom-line in the short/ medium and longer-term?
I believe that sometimes you have to be ruthless to survive but the goal should be to minimise impact on others. Beyond that, I believe that caring about everyone involved in the enterprise should be good for business. Any extra costs associated with taking time to be careful will be more than recouped by support from appreciative stakeholders.