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Justify Your Existence

Justification: noun jus·ti·fi·ca·tion \ˌjə-stə-fə-ˈkā-shən\

  1.  
    1. the act or an instance of justifying something:  vindication arguments offered in justification of their choice
    2. an acceptable reason for doing something:  something that justifies an act or way of behaving could provide no justification for his decision
  2. the act, process, or state of being justified by God
     
  3. the process or result of justifying lines of text: software that provides automatic justification of text

Meriram-Webster defines the term in the above ways. I find the term coming up in business more and more, and requests for things/people/budgets/time/etc. to be justified are coming in ways that they have not come up before. It used to be that an investment required a business case, to justify the expense. Now we hear about people and/or departments needing to justify their existence within an organization. And the new marketing/advertising model is to have the headline or even the picture that is meant to attract eyeballs justify having the reader click through and use their time reading an article.

Let’s break down the M-W definition. Point one describes vindication, or acceptable arguments for one’s behaviour and/or choices. I’m not even touching point number two. Point three is about text formatting, which in this case is not relevant. So the point I am exploring here is that in the corporate business world, we have fallen into a model that states that one must always have reasons for investing time, money, people, processing power, in any activity or in people. And if the reasons do not justify the investment, then it is a bad choice. But who makes the judgement?

It usually comes back to the executives: CEO and the C-Suite, VPs, Senior Leadership Team. They judge whether of not the investment is needed to accomplish the intended results. And it’s often arbitrary; the decision-making factors that are used are sometimes made up on the spot. The ideal is probably related back to the stated company strategy, assuming there is one. If the proposed investment will get the company closer to achieving its target goals, then it is a good choice: it is justified. If the investment has good reasons, but will not actually progress the company toward its targets, then it is a bad choice: it is not justified, and therefore no money should be spent on it, or the partnership should be abolished, or the department should be disseminated, or the staff should be fired.

For example:

  • The company’s goal is to increase profits, therefore cost-cutting measures are justified to decrease costs while revenues are sustained
  • The company’s goal is to increase revenues, therefore investments in marketing budgets and sales team headcount are justified
  • The company’s goal is to increase market share, therefore an investment in acquisition is justified
  • The company’s goal is to increase stock prices, therefore an investment in R&D & innovation is justified
  • Etc.

But what if exogenous factors impact the results of these equations? Or the equation itself is flawed?

  • CEO to VP of Sales: “We cut expense budgets in order to increase profits, and a few months later revenues are down. So you’re fired.”
  • CEO to VP of Marketing: “We gave you bigger marketing budgets to go get us more sales. You’re obviously using the funds incorrectly. So we’re cutting the budgets back down. Cut your campaigns and your staff.”
  • VP of Strategy to Big Five Consulting Firm: “You recommended this short-list of acquisition targets and conducted all this due-diligence, and someone else bought the target companies before we could. We are never doing business with you again.”
  • Board to CEO: “You lead the market with research, but your teams did not come up with anything new to disrupt the industry, and our stock price has not jumped up. You’re fired.”

And on a smaller scale, it is happening every day with every commodity that can be spent, saved, or negotiated. We ask ourselves: why should I use my precious time …sitting through your presentation? Reading your blog? Watching this show? Have you ever exclaimed after a death-by-power-point meeting: those are two hours of my life I will never get back!

Money, time, even empathy, are all commodities we are more careful with these days. Should I invest myself to put myself in that person’s shoes to really understand their perspective? It takes effort, so I want to be sure there will be some return on my investment. Is there a likelihood we will get along better if I do? Is there a likelihood we can complete the transaction efficiently? Will they do the same for me?

So when someone asked me to justify the reasons for investing in centralized intelligence management software, I first thought of some of the above thread… there are great efficiencies that can be gained, cost savings, better use of time, sharing of knowledge. But the risks of not investing in it are the big kicker: what happens if we don’t, and our competitors do?! They will know more about us than we know about them, they will know more about the customers, the suppliers, the market trends, the regulations, and they will have a quicker path to product innovation, market share, and disruption.

Now I want to use that risk-avoidance method to address all the other justifications I have noted earlier.

  • If the company does not cut budgets, it will be forced to find true operational efficiencies elsewhere
  • If the company does not increase marketing budgets, it will be forced to be smarter with the funds they are allotted today
  • If the company does not spend millions with a big consulting firm to find and buy target acquisition companies, it will be forced to either do the work itself, or grow organically
  • If the company does not invest in R&D, it will be forced to sustain or gradually grow stock prices through trustworthy, long-term, sustainable relationships with clients, good marketing, sales, production, and hard work

And if all of that still doesn’t work? Better be sure you know your markets, or else your existence in the company will not be justified.

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