The game begins

In the context of far-reaching business decisions, a decision-making body is formed in companies that commissions a project team to prepare the decision. The project team is given strategic business objectives, a time frame for the overall project as well as guidelines for the budget and the profitability of the investment. Requirements are then drawn up and weighted in a comprehensive Excel list. The providers are invited and the Olympic idea is proclaimed: The best may win! The game begins.

The ranking problem: When 2nd and 3rd place change the game

As part of an audit-proof benchmark, all providers have to prove their individual performance along the Excel wallpaper. Finally, the project team compiles all the results and assigns the providers to their places according to their degree of fulfillment and weighting. The providers in 4th and 5th place are passed, while those in 1st to 3rd place are allowed to take part in the next round of negotiations on contractual and legal conditions and the price. Until then, all is well.

The problem is that there is one 1st place and two non-1st place bidders. The 2nd and 3rd place bidders do not find this position desirable and know that 95% of the time the legal and contractual components are not decisive for the award of the contract. The bidder in 1st place just has to do everything right and will be awarded the contract. Therefore, 2nd and 3rd place will intervene. Inexperienced sales organizations question the list of requirements, the weighting and the degree of fulfilment. You should not do this, as you spoil the whole project team at an early stage, even if you are right.

How decisions are slowly moving away from the goals

Smarter teams will try to influence the decision-making basis in their favor and communicate to the decision-making body that certain extremely important, even existential aspects were not taken into account. Of course, this is not a failure on the part of the project team or the decision-making body itself. Rather, new findings have emerged that were not yet available when the original requirements were defined and cannot be ignored under any circumstances.

This is essentially the game of the providers in positions 2 and 3. In essence, these are indirect offensive strategies that have a good chance of being considered if they are well prepared and presented in the same way. We are now in iteration stage 1 of alienation from the original business requirements. The game continues. If the ranking of providers shifts as a result of the new requirements, the new 2nd and 3rd places will now react with similar approaches.

The game continues until the customer has had enough and no longer allows any further requirements. At this point, we are usually in iteration 2 to 4 and have already moved significantly away from the original requirements and their weighting. But it gets worse.

Escalation in the company: Polarization instead of agreement

The sum of all requirements, the company’s own and those of its competitors, leads to a confusing situation that is almost impossible to decide. On top of this, the camps within the company often polarize and an internal agreement seems a long way off. Disputes and frustration are not uncommon. The decision-making body is not unaffected by this development and increasingly understands that a decision on this basis is politically risky, as it would be positively supported by too few employees. However, the strategic plan, the transformation project, requires team spirit and broad support. What a dilemma for the company management! It comes to the finale!

A dilemma is looming

No meaningful decision can be made on the basis of the current list of requirements, which has been expanded to include new criteria. Nevertheless, the real business challenges do not allow the transformation project to be postponed. At this moment, the company management is particularly open to an elegant and viable way out, if it does not even initiate it itself, in order to promote what is strategically important: the company’s development and not the selection of a provider. What happens now?

When the price of decision-making ability costs one’s own interests

New requirements are defined by or with the support of company management that have nothing to do with any other requirements. From a competitive strategy perspective, an indirect strategy is implemented with the aim of making a decision that enjoys broad support. This is usually successful. The downside is that this decision-making process usually no longer has anything in common with the original business requirements. In fact, the company becomes capable of making decisions again and pays the price of neglecting its own interests. This is often the beginning of an unsuccessful transformation project. The causes can be found in the dynamics of the evaluation. The conflicts of interest of all those involved discredit sensible decision-making based on reason. I have often experienced this.