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December 3, 2012 / alipeles

4. Don’t let incomplete information block important decisions

–       Action is often more important than certainty

–       Your job may be to decide and take responsibility, even when you’re not sure

–       Bad outcomes don’t necessarily imply bad decisions

 

Remember this photo of the White House, anxiously watching the strike on bin Laden as it unfolded?

 The White House anxiously watches the strike on bin Laden

Ever think about how easily it could have documented failure instead of triumph: faulty intelligence, downed helicopters, dead civilians, American hostages, or diplomatic catastrophe? President Obama must have been dead certain when he ordered that mission. Right?

Wrong. The CIA gave him between 50% and 80% confidence in bin Laden’s location. I.e. they weren’t even sure how sure they were. They didn’t know how well armed the compound was, how many people it held, or whether the occupants were trained soldiers or amateur bodyguards. Reports tell us that Obama’s staff was evenly divided on whether to launch the attack.

But, we don’t hire our president to be omniscient. We hire him to decide and execute. We want him to make the best decision possible given as much information as he can reasonably gather within the constraints of security, time, and efficiency.

Whether your job is to decide when to take the company public or what kind of paper to put in the printer, you have been hired to make the best decision that you are capable of given as much information as you can reasonably gather within the constraints imposed on you.

We’d all like to live in a Sherlock Holmes world where, if you observe just a little more carefully and work just a little harder, the truth emerges clearly from the noise. But, in reality, facts are often murky or depend on decisions and events that are still TBD. As decision makers, we must act. We weigh, rather than deduce, taking risks and making assumptions to handle the unknown or undetermined, articulating those assumptions and risks when they’re critical.

And the outcomes tell us very little about our individual decisions. (Patterns, of course, tell us more.) If President Obama diligently did all of his homework and weighed all of the consequences, then his was a good decision, regardless of the success of the mission. On the other hand, if the president made a sloppy decision, but got lucky, it was still a bad decision, even though he got the outcome he wanted.

When your boss or your client needs an estimate today, you can’t drill into all of the details. Get the most information you can out of the time you’ve got and then estimate. Bad hiring decisions can wreak havoc. But, not hiring people when you need them can be as bad or worse. Weigh the risk of your uncertainty about the candidate against the risk of being understaffed. And then, decide.

Expect some bad outcomes. When they happen, objectively evaluate why they happened. Figure out whether you can improve your decision making process. But, don’t have regrets. If you worked hard and acted in good faith, then you did your job. Make it your goal to have the greatest number possible of good outcomes given your circumstances.

November 21, 2012 / alipeles

What about unfair criticism?

Following my last post, some people have asked how to handle insincere, unfair, or wacky criticism if not to rebut it, especially in a public forum.

Critical feedback is rarely pure. People find it difficult to articulate what precisely went wrong and critics usually have an investment in the situation, so potentially a subjective bias. Criticism is rich data, but interpretation can be a bit of work. That’s why it’s so important to clarify, ask questions, and keep the critic on side. As I said in the original post, if criticism surprises you (i.e. seems to come out of nowhere), then it’s probably valuable.

Without a doubt, some people will have a rough day and “kick the dog”, letting their moods drive the decision to criticize, rather than a need to communicate. But, bad moods make people intolerant more than vicious. Take the magnitude of such criticism with a grain of salt, but don’t ignore it. Someone’s low threshold for lashing out might actually benefit you. It gets the person to tell you something that might otherwise never have been mentioned.

Most importantly, don’t rebut insincere or unfair criticism because there’s no point. You can’t change an unreasonable person’s mind and it wouldn’t matter if you did. Instead, let that person and others to see you as a mature and reasonable person who listens and cares even in difficult situations.

November 19, 2012 / alipeles

3. Never rebut criticism

  • Criticism is data that helps you improve
  • Giving criticism is difficult. Be grateful to those who make the effort
  • If you’re arguing, even in your head, then you’re not listening

 
If you want to be better, better at anything, then you want people to criticize you. Really criticize you; no punches pulled tell-you-what-you-stink-at criticize you. It’s tough to hear. It stings. But, sincere critique is one of the most valuable gifts you can receive from a manager, a peer, a colleague, a friend, or a partner. It’s information that you can act on to be better at what you do.

Remember that criticism is tough to deliver. Nobody sane ever gets excited to tell people that they messed up. Openly and candidly confronting people with their faults requires a strong will. Most people go weak, avoiding, postponing, or watering down the message. Those who give clear feedback without hesitation have made a great effort in training themselves to do so.

Given how valuable criticism can be and how unpleasant to communicate, we are remarkably ungrateful when we receive it. Our gut reaction, the one almost everyone has almost every time, is defense. We argue with the critic, try to convince her that she misinterpreted, has only half the story, isn’t being fair, focused too much on one incident, or has a bias. I.e. we skip the part where we figure out whether the criticism is true and go right to arguing that it’s not.

Who ever says, “Thank you! I didn’t realize that I usurp authority and can’t keep meetings on track. I’m so glad that you were kind enough to tell me.”?

If a remotely sane person, even one who dislikes you and has an ulterior motive or dark agenda, gives you direct criticism then: it wasn’t easy for that person and you’ve just received valuable data.

So, LISTEN! Clarify. Ask questions. Ask for specific examples. Stay calm. Speak slowly and softly. Reiterate the criticism to make sure you’ve got it. Try to rephrase it and make the case for the criticism even stronger than the critic made it. Come up with your own examples that support the criticism.

Don’t argue. Don’t construct rebuttals in your head. If you’re arguing, you’re not listening.

If someone’s criticism surprises you, then you probably don’t believe it. Try to believe it. You might fail, but it’s the only way to give the idea a fair shake. Criticism that surprises you is the most valuable. By definition, it’s stuff that you had missed.

Keep in mind that criticism reveals how you’re perceived. The perception may be spot on, completely off the mark, or somewhere in between. But, unless the critic is lying, the existence of the perception is a fact. You want and need to figure out why.

Above all, THANK your critic. It was hard to tell you this stuff. You want the critic to know that you appreciate it. You want this to happen again.

November 11, 2012 / alipeles

2. Manage the expectations of everyone with whom you work

  • Don’t let people count on things that aren’t going to happen
  • The quality of other people’s plans depends on the quality of yours
  • Use deadlines and estimates as a tool for communication, as well as commitment

 
Expectation management gets a bad rap. It sounds like the art of laying fraudulent groundwork so that later you can bowl someone over with mediocre delivery. Naturally, we react very badly when we suspect someone’s doing it to us, “Are you trying to manage my expectations? Stop! Just lay the truth on me.”

But, real expectation management isn’t about lying. It’s about accuracy and reliability, getting people to expect what’s actually going to happen. And, it’s at the heart of good communication.

People trust you and they act on the information you give them. When you tell your friend that you’ll give her a lift to work, she doesn’t arrange another ride. If you fail to show, she’s up a creek. When you tell Accounting that the system will handle the new rules by October, they promise the regulators that the firm will be compliant in October.

Don’t let people count on things that aren’t going to happen.

Step one: keep your actions and what comes out of your mouth in lock step. Say what you’re going to do and then do it. Period.

Step two: Make sure you’re understood. What you actually said doesn’t matter to the irate client who managed to misinterpret and expect something else. Don’t let people misinterpret. Articulate clearly. Ask questions to confirm comprehension. When it’s really important, introduce a formal process. If you’ve promised something to regulators, there had better be an accuracy-attested document that spells out exactly what you plan to do.

And, Step three: Update your commitments. If you told people that the IT build would take a year then they still believe that 11 months later. Ask for one more month now and you’re going to lose them. But, heck, if your yearlong project is only a month late, you’re probably the most effective IT partner they’ve ever had. They’re not upset that you slipped. They’re feeling burnt because they committed something to their customers (or bosses or employees) and now have to go eat crow. By the way, guess why those customers are upset? They make plans and have stakeholders too.

November 5, 2012 / alipeles

1. Acknowledge important email right away

  • Senders don’t know that you’re “working on it”, unless you tell them.
  • People react to lack of information, sometimes in ways you don’t want.
  • Poor communication undermines perceptions of your competence in other areas.

Let’s say a trader comes into the office at 7:30 am, opens up the risk management system, and sees fishy numbers on one bond. She taps out a quick email to her IT manager:

Sent: 07:30
From: Sonia
To: Aaron
Subject: Bad risk in ABC?
Aaron – Is anything wrong with the risk system this morning? I see no 3-month risk on ticket #123456 in book ABC. – Sonia

I’ll give her grief later for emailing me directly. She should have gone to the support channel. (What if I had been on the subway with no mobile service when she wrote?) Meanwhile, I forward her email to support, myself:

Sent: 07:31
From: Aaron
To: Risk-Support-Channel
Subject: Fw: Bad risk in ABC?
Can someone please jump on this?

We have coverage during all trading hours. So, I can assume this has been picked up, right? But, 30 minutes later, I haven’t heard anything, which probably means that Sonia hasn’t heard anything, either. I shoot out:

Sent: 08:02
From: Aaron
To: Risk-Support-Channel
Subject: Fw: Bad risk in ABC?
Is anyone on this?

And then my boss calls me about something else and I’m sidelined on budgets or whatever for another 30 min. Now an hour’s passed and I pick up the phone:

A: Garth, is anyone looking into this? It’s been an hour!

G: Yes. It was a booking issue. Someone fat-fingered a modification. I forwarded it to trade support. They’re fixing it now.

A: How long is that going to take?

G: I don’t know … Oh, hold on. I just got an email. It’s fixed.

A: [Exasperated sigh!]

Why am I ready to spit nails? Clearly, the support team jumped on the issue exactly like I asked them to. The issue affected only one trade and it was fixed in an hour. That’s not a bad turnaround, at all.

I had to waste some time writing extra emails, making phone calls, and unnecessarily had to stay on top of one more issue as all of the other morning chaos unfolded.

BUT, the real problem is that Sonia is sitting out there on the desk, having to remember that her 3-month risk is wrong and not knowing when it will be fixed. Even worse, she doesn’t know why it’s wrong. So, she has to assume that other risk might be wrong, too. But, the markets are opening and she has to trade. So, she’s effectively flying blind. That can’t go on very long. So, she has to work out another way to verify her risk.

During our 1-hour radio silence, she’s panicking. By the time we finally come back to her with a perfectly good explanation, we’ll only be able to restore part of the confidence that we’ve undermined by leaving her in the dark. She will be thinking, “I don’t ever want to be in this situation again!

And why? Not because she can’t trust the system. There was nothing wrong with the system; it turned out that somebody entered some data incorrectly. And, it’s not because she can’t count on the people behind the system. They jumped on the issue and demonstrated real competence by rooting out the cause and getting it fixed in one hour.

Nope. Sonia is going to waste a huge chunk of time figuring out how to avoid relying on a perfectly reliable system because we communicated badly. While she was sitting there not hearing from us, Sonia came to the conclusion that nothing was being done and, therefore, that we can’t be trusted. Now, she’ll be circumspect about everything we say. So, she’ll hear us and understand that the issue was addressed quickly and that there was nothing wrong with the system. And, she’ll basically believe all that. But, she’ll still be thinking, “I don’t ever want to be in this situation again!” and she’ll be trying to figure out what she can do about it.

And you know what? That’s a rational response. Sonia doesn’t see the internals of the system. She doesn’t watch the people work. The evidence she has to go on is the behavior of the system and the communication she gets from us, which we botched.

Here’s how the conversation should have gone:

Sent: 07:30
From: Sonia
To: Aaron
Subject: Bad risk in ABC?
Aaron – Is anything wrong with the risk system this morning? I see no 3-month risk on ticket #123456 in book ABC. – Sonia

Sent: 07:31
From: Aaron
To: Sonia
Subject: Re: Bad risk in ABC?
Sonia – I’ll have someone take a look right away.

Sent: 07:31
From: Aaron
To: Risk-Support-Channel
Subject: Fw: Bad risk in ABC?
Can someone please jump on this?

Sent: 07:32
From: Garth
To: Sonia
Cc: Aaron; Risk-Support-Channel
Subject: Re: Fw: Bad risk in ABC?
I’m looking into it. I’ll send an updated in a few minutes.

Sent: 07:50
From: Garth
To: Sonia
Cc: Aaron; Risk-Support-Channel
Subject: Re: Fw: Bad risk in ABC?
The trade is arriving in the risk system with bad data. I’m in touch with trade support and should have an update within 30 minutes.

Sent: 08:30
From: Garth
To: Sonia
Cc: Aaron; Risk-Support-Channel
Subject: Re: Fw: Bad risk in ABC?
Sonia – The trade has been fixed. Please take a look and let me know if you still see any issues. Thanks.

Sent: 08:35
From: Garth
To: Sonia
Cc: Aaron; Risk-Support-Channel
Subject: Re: Fw: Bad risk in ABC?
Just to be sure, we ran a check for other tickets with the same problem. It looks like everything is good.

Sent: 08:35
From: Sonia
To: Garth
Cc: Aaron; Risk-Support-Channel
Subject: Re: Fw: Bad risk in ABC?
You guys are awesome! Thanks.

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