In a battle of cliches, would the victor be “the early bird gets the worm” or “he who hesitates is lost”?
In business, when to pull the trigger on a decision often depends on myriad overlapping considerations. But corporate leaders are well aware of the risks presented by waiting.
In a new study of corporate leaders by consulting firm West Monroe Partners, about half of the participants estimated that they lose at least 4% of their topline to slow decisions.
Fewer than one in 10 survey respondents said that such delays cost them less than 1% of revenue. The study received responses from 1,000 managers and 214 C-suite executives at U.S.-based companies with at least $250 in annual revenue.
However, West Monroe pointed out in its survey report, knowing the problem doesn’t equate to solving the problem: 49% of the C-suite leaders said their companies missed a major market opportunity in the previous 12 months, and 56% said competitors beat them to market occasionally or frequently.
A large majority (73%) of the C-suiters said that if they could cut their decision time in half, it would boost revenue by at least 5%, while one in seven said revenue would benefit by more than 25%.
As for the causes of delayed decisions, about the same proportion of executives laid the greatest share of the blame on technology limitations (39%) and skills gaps or overwhelmed teams (38%).
The managers, for their part, cited skills gaps/overwhelmed teams as the top contributor to sluggish movement (40%) and placed technology limitations third (28%).
Notably, though, among both groups of survey participants, about a third cited layers of management or approvals as the greatest contributor to delay. When leaders are slowing things down, the biggest factor by a wide margin was “the need for more data or certainty,” followed by “fear of risk and mistakes.”
The quest for certainty is a “decision-buster,” West Monroe wrote. “Every request for ‘one more analysis’ extends timelines while opportunity windows close.”
The consulting firm advised that before any analysis begins, companies should define what constitutes “enough information to decide,” and should “lock that threshold upfront — don’t renegotiate it midstream.”
Unfortunately, sluggish decision-making at the top can cascade down through the ranks. Less than half (48%) of the managers said they’re motivated to fix slow progress. In fact, 44% of managers said they have accepted slowness as normal or are apathetic toward the issue.
Can artificial intelligence help? According to West Monroe, AI can speed up individuals, but not whole companies, in most cases. “When some departments move faster and others remain constrained, the organization’s overall speed defaults to its lowest link,” the consulting firm wrote.
