You take a big risk as a leader when you make decisions based on rhetoric instead of reason.
You've probably been at meetings in which the person who dominates a discussion or debate wins with rhetoric, even if their arguments aren't completely rational. As a leader, it's up to you to find the balance between using rhetoric and reason when evaluating scenarios and making important business decisions.
Drawing on Past Experience
I've had more than two decades of meetings with consultants, governments and private banks, and larger corporations. And heading ClearSale with my partner, I've had to manage meetings in an organization that went from a dozen employees to more than 800. I've seen decision-making strategies at work in companies during different stages of growth and using different organizational structures. And I've learned a lot.
For years, I was in meetings all day. And as a leader, I was continuously seeking reason. But as companies grow larger, this becomes increasingly difficult. It also becomes even more important for a leader to find and extract reason in the midst of the myriad personalities, approaches and arguments found in a meeting.
I've said it before, and I'll say it again here: A company can be thought of as a rational being. Economically speaking, rational beings have clear expectations: They seek growth and would always prefer to have more rather than less.
Practically speaking, this means companies can be understood as a sequence of decisions, and there's always one decision (or a small set of decisions) that will maximize the organization's value. These are the rational decisions, and companies shouldn't deviate from making the right ones.
Here are some of the ways you, as a leader, can make sure this happens.
Identify Rational Decisions to Make
Here's the trick: Leaders may not always have all the information available to make a rational decision. And when they don't have enough concrete information to confidently make a decision, they'll need to rely on their intuition to make it.
Unfortunately, rhetoric will inevitably enter the equation, adding to the complexity of the matter.
Must Good Leaders Also Be Good Communicators?
I say, "No."
I believe good leadership has less to do with communicating and more to do with making the right decisions to complete a mission and positively influence a group of people to do the same.
Certainly, communication is an important leadership skill. But although good communication makes a leader's job easier, leading requires more.
Let me explain. Brazil's largest entrepreneur (in financial terms) is not a great communicator. On the contrary, he's shy and reclusive. But he has an expanded vision and makes the very best decision at each step.
At the other extreme, there is a globally recognized failure of Brazilian entrepreneurship that's a great example of communication without substance. In fact, they convinced millions of investors to spend their money with little or no rational foundation. We all know that politicians are expert communicators, but if leadership and execution were synonymous with communication, we'd have far better leadership in this country that what we see today.
Rhetoric Helps Explain and Understand Reason
The combination of reason and rhetoric makes it far easier to safely make decisions.
But when rhetoric and reason are seated at different positions of the desk, you must be able to uncover the rational argument, no matter how difficult it may be to do so. It's essential that you're able to look at every scenario and envision how each might play out.
You'll find that rhetoric often comes with cute phrases, long contexts and the encouragement to introduce others to the speaker's thoughts and feelings. Another common tactic is using metaphors, which is easy to buy into. But be careful.
Here's why. As a business owner, you may have heard the expression that "Costs are like nails. You have to keep them trimmed."
This metaphor leads us to believe that costs continuously grow and lack control. But is that really true? Even in a minimally organized business, costs increase only with budget approval. That means each additional cost is the result of a decision you made or failed to make.
If costs went up when they shouldn't have, that represents a failure in the rational decision-making process. High costs must be cut, of course. But an unjustified cost reduction could place the very sustainability of your business at risk, as someone (perhaps even your client) will directly or indirectly feel the effects of this cut.
I've watched my credit card benefits be cut, one by one, about every half-year or so. It took me two years to switch to another card, but I did. I keep wondering about the meetings and the decision-making processes that resulted in cutting these benefits. Did they use metaphors?
Here's my point: Costs may be cut, or they may go up. In either case, it's not because "they are like nails." Each scenario has its own set of consequences.
You've probably experienced the following scenario in a meeting. There are two opposing arguments on different sides of the desk. At first, nobody knows who has the rational argument. But as the leader, I know that John does. Unfortunately, he is shy, doesn't explain himself well, uses short sentences, doesn't place things into context and is constantly interrupted. Joe, on the other hand, has the rhetoric but not the reason. He's also a good articulator and has more power.
Often, I've seen the one with the rhetoric carrying the meeting and, as a result, the decision made was not the right one. John was unsuccessful in questioning nonrational arguments. He simply blushed, said it wasn't going to work, looked around for support, then shut up and gave up.
I once heard a saying in Argentina, "Never discuss with an idiot. It's not clear who's who from the outside." This is how Joe operates. Some of the technicians who are more familiar with the problem may look at each other, shake their heads and laugh at the discussion. Meanwhile, Joe goes on and on. As a leader, it's your job to avoid this. Encourage John to speak up; at the very least, ensure they have equal time. You must also ask for the opinion of those closest to the problems, explore the consequences and tirelessly look for the rational decision.
Also be careful of something I define as the "willingness to listen." It's natural and healthy to develop a number of trust-based relationships in a company; actually, it's one of the best things that can happen. However, if you have too much trust in a person's decisions, you will tend to agree with them even when that person isn't being reasonable.
Rhetoric is dangerous. It uses feelings, it motivates, it excites and it inspires. But when it's used incorrectly — that is, with no basis or reason — it can make it (or make it seem) impossible to meet any target. Rhetoric can make us lose focus and embark on tortuous paths, betray our culture, act unfairly, make incorrect assessments, value the wrong people, discourage our own talents, and signal mismanagement and contradiction to the organization.
Therefore, as a leader, it's your job to find reason — however boring, linear, consistent and cruel it may seem.
It's important to note this doesn't apply to those who are malintentioned. Instead, this applies to well-intentioned people who truly want what's good for the company. Your job is to find the right cause-and-effect relationship. When you keep your vision and strategy focused — even in light of the decisions being made — it will be easier for you to find the rational position.
And find that rational position by exploring arguments, questioning impactful statements and undemonstrated truths, and extending the meeting if the topic is important. But eliminate emotion from the decision-making process.
Of course, there are moments when emotion is essential for the business, but not when it comes to making sustainable decisions. Don't deny your beliefs so easily. Question the underlying arguments. What's fact? What's opinion?
Even question what you're reading right now; after all, my arguments have no scientific basis. This means it is, in essence, pure rhetoric.