EVER hear the expression ‘spending good money after bad’?  It happens constantly in business. From the board of directors down to the line level manager, people stick with their “people” (and often non-people) decisions WAY too long–even when it is obvious that this path is doomed. Worse, by doing so they eventually are forced to choose between good and evil, and they almost always choose evil. The board will stick with the CEO who is driving the train off the bridge, and fire the VP of sales because they are the problem–regardless of the fact that no one could sell the company’s products because the market doesn’t want them.  

For example, how many startups can you think of that have replaced the founding CEO with a “professional,” only to founder (for any reason, not just because the pro CEO is a total idiot)?  Then, while the foundering becomes a sinkhole for optimism, the board continues to back the person and their strategy–while true talent walks out the door.

Quality employees leave–usually with legitimate knowledge of both why failure is inevitable and how it might be avoided. Rarely does anyone above those people embrace those thoughts. Why?  Because as business humans we back the decisions we’ve already made, irrespective of the fact that situational dynamics have obviously changed.

Don’t get me wrong, a talented product manager might know the flaws in a product/market, but they probably don’t know how to run a company. It doesn’t mean they shouldn’t be heard. Too often, the powers that be in a company will NOT know the fatal flaws of their own products/markets–they are blissfully ignorant and more than happy to run headlong into the abyss because they believe in their cause so strongly.  

I would argue that success is predicated on challenging the assumptions/paths we’re on and refining the course as we go. The Board’s job is to ask “are we on the right overall mission?” every quarter. The CEO’s job is to ask “is the company taking the best course towards accomplishing that mission?” probably a bit more often. The department head’s job is to ask “is our group moving in the most intelligent direction in order to accomplish our component of the course our CEO has set?” and so on.  

It’s easy to lose yourself in your personal/group mission and lose the context of “why.”  “Why?” is the most important question in all of business. It’s hard to pick your head up and question why we are doing what we are doing.  People don’t do that naturally.  It’s up to the CEO and board to ask those questions, and to create an environment that fosters a culture that asks those questions. It’s up to the CEO and board to be able to look at their own decisions–and make changes–instead of defending the inane decisions they previously made.

By not fostering a “why” environment that promotes debate and discussion on shifting/altering our business plan based on current environmental realities, we will fail.

ABOUT THE AUTHOR:

Steve Duplessie is the founder of and Senior Analyst at the Enterprise Strategy Group. Recognised worldwide as the leading independent authority on enterprise storage, Steve has also consistently been ranked as one of the most influential IT analysts. You can track Steve’s blog at http://www.thebiggertruth.com