True Win-Win Commitment
08/10/10 20:55
In business, people often claim their willingness to offer win-win deals. Whether you're in the market for buying a new car as a consumer as I did last week, or whether you're interested in a specific solution or service from a preferred vendor when you're acting in your professional role, the words of "win-win" sound pretty good, even reassuring in a way. But let me ask you, what is a true win-win commitment according to you, really?
Maybe the question to ask ourselves first is why would anyone want to pursue anything else, such as win-lose or even lose-lose alternatives. I've seen many cases like these and I'm sure so have you. And, in all sincerity, I've probably occasionally acted in such less noble ways, unconsciously or even consciously. We are all on a path towards continual improvement and growth, aren't we after all?
I'd like to get concrete at this point. With our focus on Engineering Leadership what could this situation look like, if I may borrow a real-life case?
Let's say a company's executive team has the dilemma of needing to please a major customer generating $500 million of revenue this year and being requested to add a few vital software features into its current software release due next month. The release without those features is eagerly expected by a large percentage of the company's customer base and is on schedule to function according to expectations. The account team has just informed the GM and EVP that this major customer can only effectively deploy the release with these client-specific features due to certain late discoveries. Furthermore a significant portion of the projected revenue can only be recognized with general-availability software releases which are accepted as functional by the major customer. Sounds familiar?
If you have lived or are living in this kind of environment, some first thoughts may storm through your mind right now.
As a Product Manager your focus will be on initial software requirements coming from the customer and the account team. As VP of Engineering you are worried about the impact of last-minute code additions in sensitive parts of the software and the inability to perform full screening on the modified code. As Regional VP of Sales your concern is your major customer's success and continued business if the features don't make it into this release or if the software turns out to be defective with the additional features. As VP of Operations you are getting headaches but are willing to accommodate within your means regarding the logistical aspects of software distribution. As Program Manager you are seeing an equation now with last minute variables that don't add up with success unless someone puts together a miracle.
If you are a member of the Executive team a few scenarios may come to your mind immediately:
(1) accommodate the major customer, impair all other customers by delaying the release, maintain release quality & predictability of quality
(2) accommodate the major customer, keep the release on time, stretch the Engineering organization, accept reduced predictability of SW quality
(3) release official software on-time, maintain release quality & predictability of quality, work with major customer using additional beta releases in parallel containing these required changes while possibly deferring large revenue projections for your own company to the next fiscal year
(…) and there are more creative ones with the firm understanding that this may only be a one-time exception to the standard process and policies.
Reality, or life in itself, isn't simple. Add to it the wisdom that there is no such thing as a "one-time-only exception" because it will invariably set a new standard for the future inside the company.
So what can this real-life scenario teach us about the topic of a win-win commitment? Why is this concept so crucial in business and even beyond in our personal lives? What is so powerful about the concept of true win-win commitment that people get so attracted to working with other people who make it a habit of practicing this concept? Why does business and money flow so much better in this way?
Over the past eighteen months I've focused extensively on understanding human psychology and leadership in much more advanced and accelerated ways than my previous hi-tech industry leadership experience may have offered me. Healthy humans want to trust and want the other person to be trustworthy. And we would all live in harmony with this idea if many of us hadn't been deceived and over time had derived a world model of scarcity and survival of the fittest. Consider how society in general defines "winning". Whether you look at sports games where we all want to see one team win, this does infer that the other one may need to lose. Isn't this how most people, maybe not you or me, approach life?
Let's come back to our hi-tech company example: should the company's current quarter bottom line win and the executive team decide to implement the custom changes in a rush to keep the projected revenue while shielding obvious process shortcuts from the major customer and everyone else? How may this decision affect the company's reputation once software stability issues are discovered by most customers and they turn out to lose? Should the shareholders lose in the end once the company's reputation has been affected? Should the major customer lose and be blamed for not having specified these additional requirements explicitly? Should the company lose the projected revenue this quarter? Is there really a way that everyone can win in this case?
How do most people make decisions when a win-win deal isn't obvious to all involved parties? May they get emotional and be driven by fear of missing out on a possible gain? What is your personal experience with people you've worked with so far? Some may say "you can't please everybody" and they are certainly right. Some may state that "it would all have been easier if someone had done a better job discovering the issues earlier", effectively pushing responsibility away with blame.
The truth is that there is never an absolute beginning for the appearance of a specific problem. Don't things just unfold naturally until they reach an arbitrary threshold for someone to call it a problem? In life is there really such a thing as perfection? It is my belief that there are just opportunities to grow for the conscious executive and to maintain integrity and hard-earned trust with every single customer, with the various internal teams inside the company and indirectly with the long-term shareholders. His or her role is to be creative while involving true teamwork and openness with the major customer in this case and seek the best for all parties over time.
The readiness to put a significant portion of the projected quarterly revenue at stake when openly approaching the major customer may be the very key ingredient for actually both securing short-term revenue while also gaining incredible future business not even imagined. Add to this the continued trust gained from all customers over the past as well as the long-term gains for the company's shareholders when the executive team continuously meets and exceeds its previously established standards.
If I wanted to summarize I'd say "treat all other people the way you want to be treated even if it may seem at a cost to you. It takes courage, but in the end we all win."
- - -
Corinne Rattay works with senior hi-tech executives on strategic leadership, breakthrough communication and effective execution, helping her clients to achieve extraordinary results. She can be reached at crattay@crexecutiveconsulting.com or at www.CRexecutiveconsulting.com
Maybe the question to ask ourselves first is why would anyone want to pursue anything else, such as win-lose or even lose-lose alternatives. I've seen many cases like these and I'm sure so have you. And, in all sincerity, I've probably occasionally acted in such less noble ways, unconsciously or even consciously. We are all on a path towards continual improvement and growth, aren't we after all?
I'd like to get concrete at this point. With our focus on Engineering Leadership what could this situation look like, if I may borrow a real-life case?
Let's say a company's executive team has the dilemma of needing to please a major customer generating $500 million of revenue this year and being requested to add a few vital software features into its current software release due next month. The release without those features is eagerly expected by a large percentage of the company's customer base and is on schedule to function according to expectations. The account team has just informed the GM and EVP that this major customer can only effectively deploy the release with these client-specific features due to certain late discoveries. Furthermore a significant portion of the projected revenue can only be recognized with general-availability software releases which are accepted as functional by the major customer. Sounds familiar?
If you have lived or are living in this kind of environment, some first thoughts may storm through your mind right now.
As a Product Manager your focus will be on initial software requirements coming from the customer and the account team. As VP of Engineering you are worried about the impact of last-minute code additions in sensitive parts of the software and the inability to perform full screening on the modified code. As Regional VP of Sales your concern is your major customer's success and continued business if the features don't make it into this release or if the software turns out to be defective with the additional features. As VP of Operations you are getting headaches but are willing to accommodate within your means regarding the logistical aspects of software distribution. As Program Manager you are seeing an equation now with last minute variables that don't add up with success unless someone puts together a miracle.
If you are a member of the Executive team a few scenarios may come to your mind immediately:
(1) accommodate the major customer, impair all other customers by delaying the release, maintain release quality & predictability of quality
(2) accommodate the major customer, keep the release on time, stretch the Engineering organization, accept reduced predictability of SW quality
(3) release official software on-time, maintain release quality & predictability of quality, work with major customer using additional beta releases in parallel containing these required changes while possibly deferring large revenue projections for your own company to the next fiscal year
(…) and there are more creative ones with the firm understanding that this may only be a one-time exception to the standard process and policies.
Reality, or life in itself, isn't simple. Add to it the wisdom that there is no such thing as a "one-time-only exception" because it will invariably set a new standard for the future inside the company.
So what can this real-life scenario teach us about the topic of a win-win commitment? Why is this concept so crucial in business and even beyond in our personal lives? What is so powerful about the concept of true win-win commitment that people get so attracted to working with other people who make it a habit of practicing this concept? Why does business and money flow so much better in this way?
Over the past eighteen months I've focused extensively on understanding human psychology and leadership in much more advanced and accelerated ways than my previous hi-tech industry leadership experience may have offered me. Healthy humans want to trust and want the other person to be trustworthy. And we would all live in harmony with this idea if many of us hadn't been deceived and over time had derived a world model of scarcity and survival of the fittest. Consider how society in general defines "winning". Whether you look at sports games where we all want to see one team win, this does infer that the other one may need to lose. Isn't this how most people, maybe not you or me, approach life?
Let's come back to our hi-tech company example: should the company's current quarter bottom line win and the executive team decide to implement the custom changes in a rush to keep the projected revenue while shielding obvious process shortcuts from the major customer and everyone else? How may this decision affect the company's reputation once software stability issues are discovered by most customers and they turn out to lose? Should the shareholders lose in the end once the company's reputation has been affected? Should the major customer lose and be blamed for not having specified these additional requirements explicitly? Should the company lose the projected revenue this quarter? Is there really a way that everyone can win in this case?
How do most people make decisions when a win-win deal isn't obvious to all involved parties? May they get emotional and be driven by fear of missing out on a possible gain? What is your personal experience with people you've worked with so far? Some may say "you can't please everybody" and they are certainly right. Some may state that "it would all have been easier if someone had done a better job discovering the issues earlier", effectively pushing responsibility away with blame.
The truth is that there is never an absolute beginning for the appearance of a specific problem. Don't things just unfold naturally until they reach an arbitrary threshold for someone to call it a problem? In life is there really such a thing as perfection? It is my belief that there are just opportunities to grow for the conscious executive and to maintain integrity and hard-earned trust with every single customer, with the various internal teams inside the company and indirectly with the long-term shareholders. His or her role is to be creative while involving true teamwork and openness with the major customer in this case and seek the best for all parties over time.
The readiness to put a significant portion of the projected quarterly revenue at stake when openly approaching the major customer may be the very key ingredient for actually both securing short-term revenue while also gaining incredible future business not even imagined. Add to this the continued trust gained from all customers over the past as well as the long-term gains for the company's shareholders when the executive team continuously meets and exceeds its previously established standards.
If I wanted to summarize I'd say "treat all other people the way you want to be treated even if it may seem at a cost to you. It takes courage, but in the end we all win."
- - -
Corinne Rattay works with senior hi-tech executives on strategic leadership, breakthrough communication and effective execution, helping her clients to achieve extraordinary results. She can be reached at crattay@crexecutiveconsulting.com or at www.CRexecutiveconsulting.com