Navigating ‘wicked environments’

I am currently reading ‘Thinking in Bets’ by Annie Duke on of my favorite topics: Decision making under uncertainty (the book itself is so-so – will review that separately). A key point she makes: it is not the outcomes but the quality of your decisions that matter. Therein lies an important pearl of wisdom: we should be measuring ourselves less on outcomes and more on the quality of our decisions.

This is especially relevant in situations where the outcomes are not always immediate, and thus the feedback loop is often poor, missing or worse, misleading at times. These are referred to as ‘wicked learning environments’. Contrast that with ‘kind learning environments’ where the feedback loop links outcomes directly to the actions, making the feedback helpful. For instance, chess would be in the latter category – every move gives you a feedback that helps in course correction – and if you are able to make the right choices at every step, you will win or at least draw – a good outcome. In other words, your outcome is directly dependent on how well you learn at every step of the way. Real life, as we all know, is far messier: many situations in real life tend to be more ‘wicked’ than ‘kind’. We all have been through these situations: we may be doing everything right every step of the way, but we still end up with an undesired outcome. And some would argue (and rightly so) that in a world where complexity is going up all the time, ‘wicked’ environments are becoming more common than ‘kind’ ones. And so, the question is: how are we to deal with such situations? As Duke says: focus more on the quality of decisions at every step of the way – do the best you can with all the signals to make the best possible next decision. And once you do that, a good outcome is well, good but more importantly, a bad outcome is not something you should feel bad about. In other words, focus more on the process than obsessing over the outcomes.

Easier said than done – what makes this devilishly hard for most of us is, well, us. We come with our belief systems – as individuals, we fall into the confirmation bias all the time: we all tend to look at data that reinforces our belief systenm. And so, even if the signals are screaming at us otherwise, we will filter and pick up only those signals that confirm our biases.

And so, we need two things to navigate through wicked learning environments:

  1. How do we monitor the quality of our decisions?
  2. How we make sure that we are not trapped in our own biases?

This is especially true in my line of work: Enterprise solutions. The sales cycles are long, unpredictable and often, force us to get into deal specific decisions. We all have been in situations where the Account Manager has tried everything she could, and still the deal does not close in her favor because of situations that are often beyond control (e.g. business priorities shift, org changes). Worse still, this plays over an extended period of time – and larger the deal, longer it takes. And when you lose the deal, you are always left wondering: did we do enough and did we take the right actions? Post-mortems have a problem too: that of hindsight bias.

In such an environment, measuring the sales teams purely on outcomes (say, revenue booking alone) is often incomplete. So, then the question is: how do you then actually evaluate Account teams? Should we be thinking of balancing the focus between the quality of decisions and the outcomes?

Monitoring the quality of decisions

Start with a set of questions that monitor the activities that we know have worked in the past. Typically, you might want to group them into:

  1. Relationship driven:  e.g. how many multi-tier relationships (above and adjacent to the primary stakeholder) do you have?
  2. Activity driven: e.g. how many thought leadership touchpoints (e.g. whitepaper sharing, demos etc.) have you had in the last week?

Triangulate these signals to get a better picture of what really is going on in the account – and this is clearly as much an art as science.

Guard against biases

This is the hard part – Sales, like the rest of us, is likely to fall into the confirmation bias trap: interpreting signals that serve to reinforce their belief on how the deal is shaping up. And even amplifying what seems like good news and downplaying what seems like not-so good news. Say the client asks for a discussion on pricing – does it mean that the client has decided to go with your proposal or is the client using you as a price negotiation lever against a competing proposal? The Sales team might be biased to think it is the former – and it is important to make sure that this doesn’t bias the entire negotiating strategy with the client.

And so, the big takeaway: in the “wicked environment” of Enterprise solutions, it is important to design a system that ensures a feedback loop that helps course-correct at every step of the way. And if you make all the right chess moves, you will have improved your probability of winning. And even then, if you don’t, you at least know that you played your best game.

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