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    Consent vs. Consensus: How Decision-Making at Your Financial Institution is Stalling Innovation & Growth

    Consent vs. Consensus: How Decision-Making at Your Financial Institution is Stalling Innovation & Growth

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    Over the last year, I’ve found myself in meetings with our internal team or clients, asking the group… “Ok, I hear what you are saying. So, what do you propose as a next step solution?”

    Then I usually wait for suggestions, ideas and possible solutions. Invariably potential next steps begin to trickle in from the people involved in the conversation. We weigh in on all these options, and usually we identify a course of action. Or, at the very least, we come up with what else we need to know to make a final decision, and the team makes a plan to get that information and re-address the issue in a timely manner.

    It’s rare that agenda items go for more than 1-3 weeks without full resolution. However, with some of our clients, the decision-making process seems to take MUCH longer. This realization is what led me to write this blog, in an effort to share how we see waiting for full agreement or consensus causes many financial institutions to fall behind other industries.

    Risk vs. Reward: Consent doesn’t mean you agree, it simply implies you are willing to let change occur

    So, let’s define some terms for the purpose of this discussion.

    When I mention the term ‘consensus,’ it is defined as when everyone in the room agrees. Which, as you can imagine, depending on the size of group and the nature of the topic, can be extremely hard to achieve.

    ‘Consent,’ on the other hand, should be understood as when it is ok if all people are not in agreement, but everyone involved does give permission for the relevant action or decision to move forward in some agreed upon way.

    The reason this approach to discussion and decision-making is essential is because in our fast-paced world of Fintech innovation and online banking disruption, waiting for consensus will slow down change and discourage risk-taking.

    According to a recent Fintech innovation report from Accenture, “Banks should place themselves closer to the center of their customers’ digital lives, embedding customer-centric thinking at the core of the corporate strategy along with the right skill sets at every level of the organization.”

    This suggestion sounds really promising, but If your financial institution is stuck in an old-world decision-making mentality you can kiss any hopes of staying relevant in this modern digital landscape goodbye!

    So, you might be asking yourself now… how do we to adopt this approach? Well it all starts at the top. Just ask Jeff Bezos!

    Download Now: 12 Decisive Steps to Grow Your Financial Institution

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    “First, never use a one-size-fits-all decision-making process. Many decisions are reversible, two-way doors. Those decisions can use a light-weight process. For those, so what if you’re wrong?

    Second, most decisions should probably be made with somewhere around 70% of the information you wish you had. If you wait for 90%, in most cases, you’re probably being slow. Plus, either way, you need to be good at quickly recognizing and correcting bad decisions. If you’re good at course correcting, being wrong may be less costly than you think, whereas being slow is going to be expensive for sure.”  - Jeff Bezos

    This agile approach to making choices and building strategy is a huge part of what sets Amazon apart, and has helped keep the company far ahead of their competitors. Your financial institutions MUST sit up and take notice!

    Bezos suggests using the approach of “disagree and commit.”

    So senior managers need to communicate to their team that if you don’t support something, but also don’t have a strong enough reason to stop progress, rather than placing a roadblock in the way, use the term – “I disagree but consent.”

    And vice versa, if you’re a member of the C-suite and members of your team are reluctant to move forward, consider pushing them ahead with your unfettered support – “I disagree with your pace and reluctance, and fully consent to this decision. I will support whatever outcome results.” This is how risk-taking is fostered and innovation occurs.

    Playing lip-service to the notion of giving people autonomy and empowerment, and then Monday-morning quarter-backing every outcome is to be avoided at all costs.

    The key to fostering a consent vs. consensus approach is... if you don’t have a clear and considerable business reason to stop something from moving forward then you must give your consent and move on.

    Meetings: Where minutes are taken, and hours are wasted

    “Do nothing is the choice of people who are afraid. Do nothing is what you do if too many people have to agree. Do nothing is what happens if one person with no upside has to accept downside responsibility for a change. What’s in it for them to do anything? So, they do nothing.” – Seth Godin

    Ok, so no one likes meetings… wait… I LOVE meetings! Or at least I love the meetings we have with our internal team at FI GROW. We have a ton of fun, but I also love our meetings because they are so productive.

    Now, our meetings aren’t happy places of discussion and progress because I crack the proverbial whip and force people to take action. Actually, it’s the exact opposite.


    Our meetings are productive because every topic on the agenda is owned by someone and they are expected to follow a pretty simple format:

    1. Present the Idea – if it’s a problem the team member must have a solution or possible next step ready to propose.
    2. Open Discussion – keep this timed if necessary.
    3. Make a Decision – go around the 'table' for people to say if 1.) they like/agree with the idea/project, 2.) they don’t agree but give their consent, or 3.) have a legit business reason to stop it - and share that concern with the team. Those are the only three things they can say.
    4. Possibly Table for Research – This should only happen if there is a key piece of data or research needed to make the final decision. Can table an item but only for a designated period of time (1-2 weeks maximum) and you must have a clear plan to get what is needed for a final resolution.

    So, in a financial institution this process is similar. You have your agendas and as items are covered anyone with an objection must provide a clear and reputable business reason for stalling the issue or change. This could include a compliance or regulatory problem, significant potential negative financial impact, or likely negative member/customer experience implications.

    Personal preference or opinion cannot be the main reason to stop a project or deliverable from moving forward. Keep in mind that an “I consent to this” statement could mean I don’t like it or I don’t care, but I won’t stop you.

    Don’t let your institution fall victim to the ‘do nothing’ mentality.

    If you aren’t changing in this new and exciting digital banking landscape, you’re leaving customers and growth opportunities on the table. So, foster a culture of risk-taking and reward those on your team who embrace new ideas and innovation. It’s now, or never…

    Originally published as a guest blog for CU Insight.

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