In my last post, I focused on Judgment, what it is, the development cycle. But one could just say, “Yeah Dave, I get it, but so what……?”
The “so what” is the cost of not developing our judgment. But it doesn’t stop at our own judgment. There are costs at the team and organizational level. They ripple through to our inability to achieve our goals. Finally, and perhaps the biggest costs accrue to our customers.
But before I get into this, I have to lay the groundwork. In the previous article I said we are always exercising judgment. It can be good judgment, it can be bad judgment. We can choose not to exercise judgment, for example blindly following the script. But that choice is an exercise in judgment itself.
I don’t want to get tangled up in the definitional terms, what I want to focus on is the cost of not developing our capability to exercise good judgment.
We can look at these costs across a few dimensions.
Let’s dive into them.
Capability atrophy: I tend to view this as the foundation for everything we do. We bring our capabilities into each situation we confront, each conversation, every interaction. We develop these through our experiences. Every prospecting call I have is based on what I’ve learned from thousands of prior calls.
We can go through these cycles, but if we don’t constantly adapt and revise our mental models, if we don’t reflect and learn from each experience, we fail to develop our capabilities.
Yet the world is constantly changing. Our businesses, our strategies, markets. Challenges, and customers are changing. Successfully addressing these requires us to build or reinvent our capabilities.
And if our scripts, playbooks, processes, tools continue to be upgraded to support these changes, this scaffolding creates an illusion of capability. There is the problem the capabilities are in these tools, not being developed in us.
When we use AI to replace, rather than augment our thinking, AI is giving us the illusion of capability. We fail to recognize it’s AI’s capability, while our own capabilities degrade.
Dependency: Like everything I will be discussing, all of these tools can augment our capability, helping develop our judgment. But they can also create the illusion of capability. In surrendering to these tools, we become increasingly dependent on these substitutes for own capabilities. Whether it’s relying on the scripts, executing each step in the playbook, or our managers telling us what to do. We are doing what’s worked for them, failing to develop the judgment to do the things that work for us. We’ve not developed the ability to figure things out for ourselves.
As we increase our dependency on scripts, playbooks, managers, process, metrics, AI and other tools, the judgment hasn’t disappeared. We are using the judgment someone else has embedded into the system,
Our dependence on these continues to atrophy our capabilities.
We find ourselves dependent on the judgment of other people and not ours.
Adaptability: The cascade continues with the loss of the ability to adapt to the situation in front of us. “We followed the script, but they didn’t respond the way they were supposed to respond. I didn’t know what to do.”
The sad thing is customers don’t follow our scripts or playbooks. One of the most critical aspects of engaging our customers is to be able to respond to what they care about in the meeting. Of even if our scripts are hitting and the customer says, “We have a slightly different perspective on that issue.”
We leverage our judgment to adapt the playbooks and scripts to the specific situation. While these might provide a roadmap, it’s our ability to exercise judgment that drives us to determine “What’s best now? For this situation, for the person I’m talking to, for what’s important to them right now.”
As our capabilities to do this atrophy, we increasingly rely on these tools and direction to tell us what to do, but they can’t address the situations we actually find ourselves in.
This challenge is amplified by the constantly changing world we face. As our ability to adapt declines, we get left behind. We become totally dependent on what we are being instructed to do.
Losing the ability to judge our own judgment: As all of these pile up and accumulate, we lose the ability to understand our own judgment. This can have two effects. Our confidence plummets. The capabilities we had are not as impactful, we become increasingly dependent on things outside ourselves. All driving a feeling of no confidence. This inability to understand our judgment can drive overconfidence. Too often, we win by luck, not skill. Yet we mistake that for our own judgment. This leads to failure.
Lack of Accountability: As we look at the stack up of all of this, we see abandonment of accountability. We followed the script; the script was bad. We did what our managers told us; it didn’t work. And we’ve learned that people don’t get fired for following the instructions. None of it is a result of our own ability, our own judgment. All of it becomes the fault of something other than each of us.
The Death Spiral: Rather than developing good judgment, we are developing degraded judgment. And as we leverage that degraded judgment to assess our situation, we are ignorant to what is really happening. We are exercising judgment, but it is degraded or bad judgment.
I’ve developed this story looking at the loss of judgment, or the development of bad judgment and its impact on the ability of individuals. With each loss, the costs and consequences mount.
But we don’t operate alone, we are part of organizations.
Now imagine this impacting not just an individual, but entire teams in the organization. Normally, we would look at the impact as the sum across the individuals. And that’s the base level math.
As the judgment of each individual falls, in interacting with each other, they can’t recognize the degraded judgment of others. This creates a compounding effect, accelerating the impact of collected degraded judgment.
What we need to recognize is “my judgment affects the environment in which others exercise theirs.” If this is good judgment it has a huge positive impact. And the opposite has its expected negative impact.
As we see this compounding across the organization over time, we start to see the organizational impact.
Collective blindness: Our judgment always has an output. The output of bad or weak judgment is sometimes a lucky win. But if we lack the ability to distinguish luck from skill, we have learned the wrong lessons. We promote the wrong people, we develop the wrong playbooks, we train and measure our people on the wrong things.
Compensating for the decline of judgment: As we see judgment decline within the organization, we compensate for this by introducing more controls.
We add more process, approvals, metrics and inspection. Piled onto scripts, tools, prescribed methodologies. Then we see increased management intervention to drive the controls.
The more we introduce controls, the less people have to develop and exercise their judgment. They just have to do what they’ve been told.
Trust declines: The introduction of more controls is a result of the lack of trust. As our trust in people’s judgment declines, we substitute controls for judgment. But this lack of trust is not just the leaders who do not trust their people. Their people don’t trust their managers, whose judgment may be as bad as theirs. They resent the constant direction and inspection. They don’t see leaders developing them. Trust erodes.
We create incentives to discourage judgment: People adapt to the systems they live in. As we implement stronger controls as substitutes for judgment, they recognize that compliance is safer than judgment. They think, “I’ll be punished for deviating from the process and am wrong, but I’ll be protected by following it even if it fails.”
Differentiation disappears: We’ve long known it’s not our products that set us apart. It’s how we help engage our customers in understanding their problems and navigating their buying process.
The ability to interpret each situation differently, to help our customers make different choices, to build their capability and judgment is what creates greatest value with our customers.
But as we see individually and organizationally, this capability has eroded. And as it erodes, what we are left with is our offerings.
I started this section with the fact that our products are not what differentiates us, but when all our judgment has left, they are the only things that remain.
We are left with, “Give me a PO by the end of the month and you’ll get a 15% discount.”
There’s more, it’s our customers.
As we become progressively worse in creating value and meaning for our customers, they are confronting uncertainty. Their real situation never gets examined. We are only responding to the symptoms.
Our customers are addressing challenges they have never faced before. They have no experience, consequently, have been unable to develop the judgment. They may have seen similar situations, so they are not completely blind. But they have never had the opportunity to develop the judgment critical to what they face now.
In theory, that’s the value sellers are supposed to bring. We’ve seen hundreds of situations before. We have learned how to identify what’s important or not. We have learned how to adapt our experience and knowledge to the customer’s situations. We have learned how to engage the customer and build their confidence and trust.
Here we have to be careful. We aren’t bringing better judgment to the customers. We are bringing our experience and helping them develop their own judgment.
But when we cannot provide this, when our only capability is to deliver features, functions and a month end discount, we have left them to figure it out for themselves.
And we shouldn’t be surprised by what we see. Skyrocketing no decision made, increasing buyer remorse, longer buying cycles. Some manage to acquire or develop knowledge and judgment. But most don’t.
And this is the real cost.
When we exercise poor judgment, we lose a deal. When the customer does the same, they can go out of business. We tend to think of cost as lost revenue. But the biggest costs are with the customer. It’s the failed implementation, the cost of solving the wrong problem, the lost opportunity.
We don’t count those costs, yet this is where we have our greatest impact.
Have I created a picture that alarms you?
The judgment we fail to develop doesn’t only impact us. It impacts everyone we work with, our teammates, colleagues, organization, and our customers. It shapes the relationships we have, influences the organizations we build, and ultimately the decisions our customers make.
This is the true cost of not developing good judgment.
Afterword: Again, I’m always intrigued by the way these AI characters interpret my post. They have the ability to take this, add fascinating examples, and develop a richer view than I have presented in the article. Enjoy!
