A board voted to sell the company. Its largest shareholder said no. Both were analysing exactly the same data, and neither could possibly have known who was right.
Good piece — the outcome-bias warning is the right frame, and the point that disagreement is a property of the decision rather than a defect in the other person is one most leadership teams have never been told.
Two things I'd add.
The first is the board split, which you read as evidence the argument was real. It is. It's also a diagnostic. One body, one fiduciary duty, one set of information — and opposite conclusions, reconciled by a vote rather than by a method. Nobody had agreed in advance which components mattered and in what proportion, so each director ran his own weighting privately and the disagreement only surfaced at the end, as a tally. That's a process gap, and unlike the underlying uncertainty about China, it's fixable.
The second is the one your piece leaves out entirely. Ask whether you could have predicted each side's position from the payoff structure alone, without any China data at all. A board that approves a 59% premium and gets sued survives it; a board that blocks one and watches the stock fall does not. A CEO facing a three-year turnaround has a different relationship to a clean crystallising event than a 30% holder who can't exit at scale anyway. None of that requires bad faith — the parties are responding rationally to asymmetric environments. But if position is predictable from payoff without reference to evidence, then five months of rigorous argument failing to converge has an explanation other than the future being unknowable.
The two connect. Absent an agreed method for weighting the evidence, the weights default to whatever each party's incentives make it comfortable to weight — and everyone involved experiences that as reasoning.
Absolutely, strong leaders recognize that disagreement improves decisions when diverse perspectives are explored openly, because better thinking matters more than avoiding conflict.
Well observed, and very well presented Ian
I really need to read more of these articles to stop throwing a tantrum and storming out.
Good piece — the outcome-bias warning is the right frame, and the point that disagreement is a property of the decision rather than a defect in the other person is one most leadership teams have never been told.
Two things I'd add.
The first is the board split, which you read as evidence the argument was real. It is. It's also a diagnostic. One body, one fiduciary duty, one set of information — and opposite conclusions, reconciled by a vote rather than by a method. Nobody had agreed in advance which components mattered and in what proportion, so each director ran his own weighting privately and the disagreement only surfaced at the end, as a tally. That's a process gap, and unlike the underlying uncertainty about China, it's fixable.
The second is the one your piece leaves out entirely. Ask whether you could have predicted each side's position from the payoff structure alone, without any China data at all. A board that approves a 59% premium and gets sued survives it; a board that blocks one and watches the stock fall does not. A CEO facing a three-year turnaround has a different relationship to a clean crystallising event than a 30% holder who can't exit at scale anyway. None of that requires bad faith — the parties are responding rationally to asymmetric environments. But if position is predictable from payoff without reference to evidence, then five months of rigorous argument failing to converge has an explanation other than the future being unknowable.
The two connect. Absent an agreed method for weighting the evidence, the weights default to whatever each party's incentives make it comfortable to weight — and everyone involved experiences that as reasoning.
Absolutely, strong leaders recognize that disagreement improves decisions when diverse perspectives are explored openly, because better thinking matters more than avoiding conflict.
The decision was considered correct the day sales fell.
It would have been considered equally correct if they had risen.
The future does not justify a choice. It simply comments on it, later, with evidence that was not available at the time.
The only thing one can control at the moment of making a decision is whether they heard the strongest objection.