Beginning at the End

Why do we so often start with the conclusion? Today, at a retreat for a non-profit Board I chair, we had to struggle throughout the day with the danger of believing we already knew the answer and then framing the questions accordingly. I see this often in my professional real estate life as well. And sometimes I am certainly guilty of it myself.

To be a CEO definitely requires confidence – if I am to lead people I must believe both in my own leadership qualities and the direction in which I am leading. All in all I think my record as a leader is not bad, but I have definitely made some big mistakes over the years. Many, if not most, of them arose because I made assumptions which led inexorably to certain conclusions. There was nothing wrong with the process.  The only problem lay in the assumptions!

I am frequently struck by how economists, using similar methodologies, can come up with such radically different predictive results. In fact you can usually find an economist to support any position along the politico-financial spectrum. How is that possible, I wondered for years as a young man? Then I realized that, of course, the assumptions were different.

In my business we work a great deal with members of the finance industry. One of the things they like to say to me is that they are “data driven.” Here’s my observation: “data” tends to be selective. The “data driven” among us make just as many assumptions and have just as many prejudices as anyone else. I have never met any seller, regardless of his or her background or field of endeavor, who did not argue with my pricing conclusions if my price suggestion did not meet or exceed expectations. My data is wrong, they say. Or what about this higher priced sale (pointing to an outlier in a superior building in far better condition)? Everyone, regardless of what they may want to believe about themselves, makes assumptions, and almost no one much likes having those assumptions challenged. But for us to be good at what we do, both in our personal and professional lives, we MUST force ourselves to let the process of decision-making unfold in an orderly way and be open to the possibility of an unanticipated arrival point.

And what’s an orderly process for me? First, I have to create a team with diverse points of view. Then we define the issue, and see if the team buys into my definition. Then, once the issue is framed, we have to do research to determine the set of most practical alternative solutions. Each of these has to be examined for its pros and cons, with as little prejudice as possible.  And I have to encourage the dissenters to speak up so we really hear differing perspectives. The pros and cons need to be weighted for importance so we don’t give too much importance to one factor or too little to another. Then we re-examine to determine what we forgot on our first run through (more often than not, at least one important issue slipped off the table during the process.) Then, finally, we are ready to draw conclusions.

Plenty of leaders have a “good gut.” Their instincts are well honed and clear. But our instincts tend to lead us down the expected road. Often it is precisely the suspension of our instincts which leads us to the best conclusions.

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