Biased Decisions Mean More Pitch Losses
We’re all aware of unconscious bias. Or should be. It impacts diversity and inclusion results, hiring decisions, employee engagement and retention and corporate culture.
Biases might also explain why we sometimes find ourselves in new business losing streaks.
Biases can be a problem at any stage of pitching. I’ve seen bias in team composition, collaboration, selecting a recommended solution, even in pitch performance.
Sometimes bias is evident even before the pursuit begins.
Distortions and Deceptions
Bias can show up in how we distort reality, or deceive ourselves.
This detailed article from McKinsey tells you all you’ll want to know about distortions and deceptions in strategic decisions. Distortions are often unconscious. There are two of note that turn into bad decisions:
- Loss aversion
While distortions can be unconscious, deceptions are often deliberate. They stem from a misalignment between corporate goals and the situation as seen on the front lines. Three likely causes:
- Misalignment of time horizons
- Differing sensitivities to risk between the pitch team and leadership
- Imbalance of information between what the front line knows and what leadership knows
All of these can lead to bad decisions about which business to pursue and how to pursue it.
For this post, let’s focus on the Distortions
This one speaks for itself. I’ve written about it several times. Too often, agencies pursue business they can’t win because, well, they think they can. Maybe they’re focusing too much on a previous win or wins and not seeing the dissimilarities of the new situation to those older ones. Maybe they’ve got so much confidence their own abilities that they’re unaware of how they really stack up against the competition. Maybe this overoptimism has prevented decision makers from seeing how burned out their own pursuit teams have become.
Have you heard of Fear Of Missing Out? It’s a kind of distortion that leads to bad pitch decisions.
Here’s what I think is going on: I’ve got to pursue this available opportunity because I don’t know where the next opportunity is going to come from. A version of FOMO. Since not participating is viewed as missing out, i.e., losing, agencies will overextend themselves into pitches they have no right to be in.
Vetting Criteria to the Rescue
You’ll never remove all subjectivity from pitch-or-not decisions. But you’ve got to make those decisions consciously. Here’s the approach I like approach for giving yourself the best odds of removing bias:
- Establish clear, measurable (as possible) criteria for every pitch opportunity.
- Make those criteria pass-fail. Rating on a scale is too subjective. Place a high bar on “Pass.”
- Assign a review committee to look at every opportunity against the criteria. Healthy debate within the committee is encouraged.
- Accept no opportunity that doesn’t meet ALL criteria. (If you must, you can go with something that meets 6 of 7 criteria or 9 of 10, as long as it meets your non-negotiable criteria, such as minimum revenue or acceptable pitch process.)
We can’t eliminate bias in decision making. We can’t pretend it doesn’t exist. Make better new business pursuit decisions with a vetting process that makes bias less likely to be a factor.
Professionals in business development and their counterparts in any agency or professional services firm are passionate about what they do. They believe in their firm can solve any prospect’s problems.
And if they have doubts, often the business unit leader or owner will step in to insist they can win just about any pursuit.
So an outside perspective can be invaluable.
WCG provides workshops to develop strategic business development plans with an emphasis on targeting and vetting criteria. We take a thorough look at firm strengths and resources, and match them up with markets and opportunities that will make the most sense to pursue. The result is a new business plan that energizes everyone in the house. There will be fewer prospects offering more value and a improved odds of winning.