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Many organizations suffer from undiagnosed premature evaluation. Decisions are made without adequate information, leading to unexpected costs and disappointment.
We could mitigate the risk of premature evaluation by adding a new sign-off requirement to the business case for all new initiatives: a qualifying level of confidence in the quality of information supporting the proposal.
Of course, sponsors of significant changes should always provide coherent and concise explanations of how the business case rationale has been derived – so that those who approve an initiative can have greater confidence in the quality of their investment evaluation.
But in my experience, the quality of information [rationale] supporting a business case is often quite weak and insufficient to provide stakeholders with a proper justification for approval.
Nevertheless, these business cases frequently get passed – despite, or more likely because of, their inadequacies.
If we want to improve our strategic performance, we should resist the pressure to succomb to premature evaluation.
Here is how we can reduce the risk of premature evaluation by adopting a simple [but effective] measure: ask each person with responsibility for approving a business case to certify their personal level of confidence in the quality of information provided – on a scale of 0 to 10.
This simple process should make each individual consider business cases in a new light and improve the quality of our decision making.
Colin can help organizations and individuals to improve their evaluation processes, please use the contact form for more details:
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