Decision-making is one of the most critical activities in any enterprise. From everyday decisions such as how to approach an upcoming sales pitch or handle a complex service issue, to more strategic choices such as where to set quotas for next quarter or whether to enter a new market.
It’s surprising therefore that enterprises approach it so unscientifically. As Cloverpop CEO Erik Larson — who believes he has a solution — puts it:
Decision-making is the most important process in a company. It’s the most highly correlated with future performance. The news flash is, there’s literally no software system to manage it and optimize it, and communicate how it could be made better over time.
But aware as he is of the problem, even Larson found himself surprised when he studied the decision-making in his own company, which markets a software solution that targets precisely this issue. Analysing its decision making processes for inclusivity demonstrated how important it is to validate assumptions that we take for granted, as he explains:
If you’re not measuring something, it’s very difficult to see what should be changed.
I was convinced our company was going to be very inclusive. As part of this research we went in and looked how we compared to the average. It turned out we were about average.
It was truly shocking to me that we were average. It didn’t seem possible.
How to make better decisions
The story illustrates something called ‘decision bias’, says Larson. Most of the time, a manager already has a decision in mind and then goes through a process that simply confirms that original decision. This means the organization wastes time simply going through the motions of endorsing decisions, without any effective mechanism for challenging those that haven’t been properly thought through.
Cloverpop’s existing customers use the product to raise decision-making in fields such as HR and product design. One large technology company uses Cloverpop to manage how it prioritizes product feature requests. This used to be handled in a committee meeting that met every 4-6 weeks, or in backchannel communications outside of the formal process. Cloverpop now allows most decisions to be made on the go, with only a few of the most intractable issues held over for the in-person meeting, says Larson:
These executives have an hour or more back a month and the decisions happen within a few days instead of having to wait weeks. And it’s all recorded, so accountability issues are eliminated.
At Dreamforce this week, Cloverpop is showing off its Salesforce integration with the aim of bringing similar improvements to sales and service teams. Cloverpop decisions can be connected to specific objects in Salesforce, such as an account, and then the application streamlines the process of bringing people into the decision-making and keeps a record of how a decision is reached. It means salespeople can spend less time “navigating the internal politics,” says Larson and more time focusing on the job in hand:
The Salesforce integration was driven by our belief that decisions happen in the midst of other processes.
Cloverpop is also building out a messaging API and already integrates with Slack. It’s important to take decision making out of side channels such as email and private messaging, to make it more visible, says Larson.
Human beings are very reluctant to tell other people about decisions that have been made. The key integration is actually to push the decision information out into public channels — take it out of the private conversations where it’s happening.
Diversity and inclusion
New research by Cloverpop shows that inclusion is one of the most important factors contributing to better decision making. Analysis of age, gender, geographic locations and departmental functions shows that the more diverse the participants in a decision, the better it will be, says Larson.
If you have diversity and include those diverse people in decision making, the result is better decision making. The statistical confidence is through the roof.
Every dimension of diversity we looked at had a positive impact on the decision making process.
The effect is cumulative, so that if you combine a diverse range of ages and genders and make sure that the participants were a mix of different locations and functions, each element of diversity that you include increases the quality of the outcome. In Cloverpop’s own case, Larson realized that although the organization was very diverse, many decisions were being taken without including people from different functions, age groups or genders.
Indeed, studies show that the worst combination is a very diverse organization that doesn’t have inclusive decision-making processes, says Larson:
They’re taking these decisions as a non-diverse group of managers, that then go out to be executed by a diverse workforce. That group has the worst of all worlds — and that’s how most enterprises operate at the moment.
We first wrote about Cloverpop on diginomica two years ago when Jon Reed reported on its mission to improve decision making. Since then the company has raised an $8 million series A funding round and is now building integrations and use cases.
The focus on highlighting inclusive decision making is a good choice of pitch to make at Dreamforce, where diversity is a big theme. And the promise of spending less time making better decisions is one that should appeal to sales managers and customer service leaders.
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Disclosure - Salesforce is a diginomica premier partner at time of writing.