The Polarization Problem: How to Dislodge and
Move Forward When Decision Makers Are at a Stalemate
The rapid-fire pace of business today means companies must make big, bold strategic decisions quickly, fearlessly, and often. When teams are polarized, this can't happen. Amanda Setili explains how stalemates cripple your company and offers six steps for reaching a breakthrough.
Atlanta, GA (December 2017)—Polarization is a common problem for companies trying to make smart and agile strategic decisions. (Hint: That should be all companies.) When people band together with likeminded teammates, it's human nature for them to get more and more entrenched in their mindset. The result is two opposing camps, each seeking a decision that's more extreme than the original ideas of individual team members. This is a predictable outcome of group decision making dynamics. Unfortunately, says Amanda Setili, it can be a highly destructive one.
"What often happens in group decision making is that two extreme options rise to the top," says Setili, author of Fearless Growth: The New Rules to Stay Competitive, Foster Innovation, and Dominate Your Markets (Career Press, 2017, ISBN: 978-1-632-65107-5, $17.99). "The decision is forced into a 'yes or no' framework, and alternate options—which many team members might actually prefer—are left off the table. Because neither camp will give an inch, the CEO may have to step in and make the final call.
"The end result is a decision not many people really like, a CEO who blames the team for indecisiveness, and behind-the-scenes grumbling that the CEO is playing favorites or behaving like a dictator," she adds. "In situations like this, no one wins."
Consider this typical example:
Jill, president of a company that had created a new "smart home" thermostat, was at a crossroads. Over the past year, her company had conducted tests, in three geographic markets, of a direct-to-consumer sales approach. The tests showed that given sufficient investment, her company could supplement its current sales to DIY retailers and local heating and air conditioning (HVAC) companies by selling direct to homeowners. Now was the time to expand the program nationally, but the team had reached a stalemate over whether this investment was wise.
Members of the team fell into two camps, each side adamant about its position.
The "go" camp felt that selling direct to consumers was essential in order for the company to reach its growth goals. They asserted that there were vast numbers of homeowners who would purchase and install their own smart thermostats if they understood how easy it could be and were provided with clear instructions.
The "no-go" camp felt that selling direct to consumers would kill the company. "It's too risky," they said. "If we go direct, DIY retailers and HVAC services companies will drop us as a supplier—they'd rather carry a product that they alone can supply." The "no-go" camp also feared that the company didn't have the skills or deep pockets needed to be successful in the direct-to-consumer business. "Companies that are good at direct-to-consumer marketing are experts in search engine marketing and content marketing. They know how to reach the consumers who are in the market for their products. We don't have those skills, and we could spend a fortune trying to build this business and still fail."
Jill's team had been wrestling with this go/no-go decision for over six months, with zero progress. Each camp had dug deep trenches, accumulating more evidence that their point of view was correct. Jill saw risks on both sides, but knew that whatever path forward the company chose, gaining the full commitment of her team—the leaders of sales, marketing, manufacturing, finance, human resources, and legal—was crucial for success.
So, what happens next? Ideally, says Setili, in a stalemate situation like this, the leader should take six key actions:
1. Set clear objectives. As a first step to resolving the impasse, Jill got her team together to agree on objectives. After a full afternoon of healthy debate, the team agreed that within two years, it was essential—a "must have"—to achieve 20 percent market share. The "nice to haves" included retaining at least the current level of sales with the DIY retailers and HVAC services companies, and maintaining at least 10 percent net profits.
2. Develop several alternatives. A week later, Jill's group gathered again to discuss alternative approaches to meeting their agreed-upon objectives. Members of both camps were surprised at the breadth of options the team identified. Over the past several months, each side had become so entrenched in its own point of view, they had not realized how much middle ground existed. After several hours of brainstorming and heated discussion, the group had developed four distinct alternatives for how to proceed, which varied in terms of the partners they would enlist, the way they would engage the HVAC services companies, and how the company would manage logistics to supply each local market.
3. Address each camp's specific concerns. As you are evaluating the pros and cons of each strategic alternative that you are considering, it's crucial to address each side's concerns. Jill asked a lot of questions and paid attention to both the facts and the emotions each team member expressed.
For example, Steve, the head of sales, had spent years building relationships with the leading HVAC service companies in each local market and with retailers. These people were not only business partners, they were friends. He felt strongly that if the company was to sell direct to consumers, it must find a way to partner with these sales channels to make them successful. Chris, who ran manufacturing and logistics, was most concerned about how the company would manage the thousands of individual shipments to consumers. Dana, who managed marketing, wanted a commitment from the board that the marketing budget would be maintained at robust levels, even if it took many months for direct-to-consumer sales to take off.
Jill made sure that any plan the team came up with addressed concerns such as those Steve, Chris, and Dana expressed.
4. Choose a path forward, then adjust course as you gain knowledge. The most common cause of stalemates is uncertainty about what the future will bring. And the best way to get facts to address these unknowns is to test the waters. Jill's team decided to collaborate with several HVAC services companies, to experiment with different ways of enlisting them as partners. Stocking local inventory, performing particularly tricky installations, and taking tech support calls were among the ways that HVAC services companies could potentially contribute. The "no-go" camp was surprised to learn that the HVAC suppliers actually liked Jill's company's new direct-to-consumer approach, because it enabled them to attract new customers for profitable maintenance contracts.
5. Manage the risks as you implement. Jill assigned one person on her team to manage each of the risks related to the direct-to-consumer approach. For example, Steve, the head of sales, worked with HVAC services companies to make sure their needs were met. Chris was in charge of managing inventory and shipments, and was measured on customer-service metrics related to delivery. Dana embarked on a process to build the brand online and was held accountable for marketing metrics, such as marketing cost per completed direct-to-consumer sale. Because each risk was explicitly managed, the team was able to press forward with tremendous speed and coordination.
6. Recognize both small and large wins on the path to success. As you pursue a new strategic path, it's essential to recognize and celebrate small wins. Jill made sure to celebrate even the small signs of progress each week, such as upticks in direct-to-consumer sales or favorable reviews online. This kept the energy high and helped the team to stay cohesive as they navigated the bumps on the road to success.
Whatever you do, don't let the polarization problem stop your company from pursuing bold growth strategies, warns Setili.
"In our age of disruption, you must be agile and courageous," she says. "Letting fear and indecision slow you down is a huge mistake. In fact, it can be your death knell. Today's business climate rewards fast innovation and adaptability. And leaders who understand how to unleash employee creativity and build a culture of trust can help teams break stalemates and move ahead fearlessly."
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About the Author:
Amanda Setili, author of Fearless Growth: The New Rules to Stay Competitive, Foster Innovation, and Dominate Your Markets, is president of strategy consulting firm Setili & Associates. An internationally acclaimed expert on strategic agility®, she gives her clients—including Coca-Cola, Delta Air Lines, The Home Depot, UPS, and Walmart—unbiased and laser-clear advice on how to respond quickly and intelligently to a changing marketplace.
A past employee of McKinsey & Company and Kimberly-Clark, Setili served as an executive with successful disruptive technology startups in the U.S. and Malaysia. She is a graduate of Vanderbilt University and Harvard Business School and has taught as an adjunct professor at Emory's Goizueta Business School. To learn more, please visit www.setiliconsulting.com.
About the Book:
Fearless Growth: The New Rules to Stay Competitive, Foster Innovation, and Dominate Your Markets (Career Press, 2017, ISBN: 978-1-632-65107-5, $17.99) is available at bookstores nationwide and from major online booksellers.
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Email: press@oc.usda.gov
USDA Announces New IT Operating Model
(WASHINGTON, Dec. 14, 2017) – U.S. Deputy Secretary of Agriculture Steve Censky announced today the U.S. Department of Agriculture (USDA) will revamp its Information Technology (IT) operating model to increase efficiency in serving its customers.
“When I was sworn in, Secretary Perdue charged me to help him make USDA the most effective, most efficient, most customer-focused department in the entire federal government,” Deputy Secretary Censky said. “One way to do that is by instituting a new operating model for IT. We have no choice but to modernize – we cannot continue to conduct business for the next 150 years based on splintered and out-of-date operating models.”
Gary Washington, USDA’s Acting Chief Information Officer, added, “We know that our ability to effectively manage and modernize information technology systems will be a key success factor in USDA achieving the Secretary’s vision for a more customer-focused organization. We are excited with our plan to harness technology that will enable informed decision-making and improve the experiences customers have when interacting with USDA, whether they are working with us online or sitting across the table. The opportunities available for IT to benefit USDA’s customers today are significant and far-reaching.”
U.S. Secretary of Agriculture Sonny Perdue has been actively working to position USDA as the best-managed agency in the Federal government. The USDA touches each American citizen every day through its work with America’s farmers, ranchers, national forest users, rural communities, consumers, trade partners, agricultural industry, scientific researchers, and the public. To best serve customers, USDA is becoming a data-driven organization that can provide timely and accurate information at the fingertips of customers and employees.
In order to ensure a smooth transition, USDA will work with the White House Office of American Innovation to execute a series of key strategies:
Updating the critical IT operating model enables USDA to make effective strategic decisions, improve customer experience, become increasingly more data-driven and adopt new technologies, all without a reduction to the workforce
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Staying Off the Naughty (Spending) List:
Ways to Manage Your Finances and Avoid Post-Holiday Blues
The holidays are filled with temptation to overspend.
Here's my advice on how to manage your holiday spending.
By Eric Tyson
The holidays are upon us, bringing all those personal and family images and sensations we cherish. But for many of us, there are a few not-so-joyous holiday sights (overflowing boxes and bags from our purchases) and sounds (email notifications of our latest orders and purchases online and the ca-ching! of retail cash registers marking our escalating debt). These negatives can easily outweigh all that we love about the holiday season.
Overall, the 2008 financial crisis and recession brought about a renewed dedication to saving. It's very important that you not let your holiday spending zap all of the saving progress you made during the year.
Whether it's a dedication to the gift-giving tradition, a sense of obligation, or a feeling that the holidays entitle us to have a little more fun than usual, too many of us seem to turn a blind eye to the budget-busting reality of all that spending over just a couple of months. Don't let excessive holiday spending cause unnecessary financial stress for you and your loved ones.
What if you could have a wonderful, memorable holiday and avoid the financial hangover afterwards? Read on for my tips on how to keep your holiday spending in check.
Find an alternative to gift-giving during the holidays. Many people feel they have to give gifts during the holidays, either because it's a family tradition or because they know their friends and relatives have gotten gifts for them. There are plenty of great ways to trade in this tradition for another one that is even more meaningful, and chances are your family and friends will be happy to save gift-buying dough as well.
Instead of exchanging gifts, your family members might want to pool their money and spend it on a holiday outing. If you have kids, you'll probably want to get them a little something, but set strict spending limits. Instead of piling up the toys, let each child choose an outing or event that he or she gets to spend with you one-on-one. Kids will look back on the valuable time you've spent together a lot more fondly than they will any toy or video game they use a couple of times and then toss aside.
If you must buy gifts, cut your expenses elsewhere as necessary. Perhaps you'd rather dine out or go to the movies less, or maybe you can forego that new pair of shoes you've been wanting for yourself in order to afford gifts for the grandparents. It doesn't matter where you make cuts, just that you make them. Keeping your other spending under control while you're out there doing your shopping can be a challenge, but just keep repeating to yourself the importance of not over-spending. That way when it comes time to actually pass out those presents you've purchased, you can do it without grimacing as you think about the damage they did to your bank account.
Set a budget and keep tabs on what you are spending. While you're doing your holiday shopping, your new best friends should be your bank account and credit card records. It's easy to get into a spending rhythm when shopping for yourself or others, and that's why you need to keep track of every purchase you make and make sure you don't go over your budget. When you start to add up everything you're spending, you may be shocked at what all those expenses from this store and that store add up to be. And don't forget about all those "necessary" holiday extras. Most people don't budget their shopping and don't realize that by the time you buy all the presents, plus wrapping paper, cards, decorations, etc., it's added up to a ridiculous amount. Having a budget that you know you must stick to will help keep your impulse spending from getting out of hand and will help you hone in on the most reasonably priced holiday items.
Plan what you are going to buy, and don't get any extras! Particularly during the holidays, companies pull out their most appealing packaging in hopes of snagging the eyes of shoppers. That's why along with your budget, you're going to want to take an exact list of what you want to buy for your gift recipients. Don't go shopping for someone's gift until you know exactly what you are going to buy.
It's very easy to go in with no plan, see something you like, and get it simply because you have no idea what else to get for a hard-to-buy-for relative despite the gift's significant price tag.
Watch out for deals that seem too good to be true. Retailers and websites run all sorts of specials to induce consumers to buy now, and the holidays offer these companies easy prey in the form of deal-seeking, cash-strapped consumers. For example, furniture stores frequently offer that if you buy now, you don't have to pay a thing for a year, and you might even get free delivery. This sort of "push" marketing can make it harder for you to say no.
This is just one example of how stores coax in shoppers. Always remember that free financing for, say, a year is not a huge cost to the dealer, but it is a cost, and if you forgo it, you should be able to negotiate a lower purchase price. Retailers find that buyers are less likely to negotiate the price if they are getting a short-term financing break. Read the fine print on any deal you are considering taking before you go to the store to make the purchase. It can be even harder to say no once you get to the store, so you'll want to know what you are in for before you get there.
Leave the plastic at home. Many of us can explain away spending so much on gifts because we simply charge everything and reason that we can pay it off gradually after the holidays. This is a great way to create a never-ending cycle of consumer debt for yourself. It only creates unnecessary financial stress for you after the holidays.
Use your budget to figure out how you can purchase the gifts you want to purchase without putting them on your credit card. If you are so cash-strapped that you think it will be difficult to avoid charging gifts, then you may want to sit down with other friends and family and propose a limit on how much gifts can cost this year—or propose no adult gift exchanges at all. Far from being disappointed, it's likely they'll view this reprieve from gift-buying as a gift in its own right.
Invest in your kids' financial futures. It may not seem as exciting to your kids as a new iPod, but a contribution to their financial well-being will be appreciated long after such expensive "toys" are obsolete. Have the grandparents contribute to a college tuition fund or savings account rather than buy them more stuff they don't need. Or make one of your gifts to your kids a stock fund portfolio that can start accruing now. Also, make them aware of the budgets and tools you are using to keep your spending in check. The holidays are a great time for them to truly learn that money doesn't grow on trees.
Give the gift of time to your kids. Often, parents buy gifts for their kids with the best of intentions. Either you don't want to deprive them of the toys and gadgets all of their friends have, or you want to give them the things you didn't have as a kid.
Both of these tendencies are perfectly understandable, but I've found that parents who buy too much for their kids often have difficulty changing the habit. The holiday season offers great opportunities for you to show your kids how much you love and care for them. For example, you can make time with them each week to watch a holiday film or TV show, go on a walk to see your neighbors' holiday lights and decorations, or emphasize that giving-back message again and take them caroling at a local retirement home. All of these activities cost next to nothing, and they will be fun for the kids and for you!
Remember that meaningful gifts don't necessarily have a big price tag. Sure, it might be nice to give your mom a brand new TV, but there are other things out there that will be even more meaningful and enjoyable for her. If you are looking to give a gift that truly means something and that will keep its value for years to come, you are better off looking for nonmaterial gifts to give than for something your gift recipients could get themselves at the local big box store.
Money can easily become the focus of the holidays when it should be the last thing you are thinking about. By keeping your spending under control, you can have a great holiday and avoid the sick feeling in the pit of your stomach that occurs when you start getting those January credit card bills. If you prepare properly, you can achieve a happy balance of spending and saving during the holiday season. That's a great gift in and of itself, for both you and the people you love.
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About the Author:
Eric Tyson, MBA, is an internationally acclaimed and best-selling personal finance author, counselor, and writer. He is the author of five national best-selling financial books including Investing For Dummies, Personal Finance For Dummies, and Home Buying Kit For Dummies. He has appeared on NBC's Today show, ABC, CNBC, FOX News, PBS, and CNN, and has been interviewed on hundreds of radio shows and print publications.
About the Book:
Personal Finance in Your 20s & 30s For Dummies® (Wiley, 2017, ISBN: 978-1-119-43141-1, $19.99) is available at bookstores nationwide, from major online booksellers, and direct from the publisher by calling 800-225-5945. In Canada, call 800-567-4797. For more information, please visit the book's page on www.wiley.com.
