Steven's Blog

Ownership Trumps Buy-In

New methods can appear threatening to some managers who have never had to change in order to be successful.

Too many CEOs want buy-in first before executing a change. Click To Tweet

However, the most successful CEOs I know treat ownership of a change as the first priority and understand that buy-in will come later.

For example, the CEO of a European company in Japan knew that he had to reform sales strategy and methods if the company was to achieve growth objectives. That meant that salespeople could no longer simply rely on their network order-taking, but instead would have to learn to hunt for new business from new types of customers in new industries, selling to higher level buyers in a new way. The CEO insisted on waiting for buy-in from sales managers that would never come, at least not until the senior managers all retire, and even then it is not clear that those who succeed them will buy in.

Unlike buy-in, ownership allows for dissent because it is based on duty, not agreement with your rationale. Leaders first establish ownership and then entrust to others. Ownership is built on empowerment. By empowerment, I mean the ability to effect a business outcome as the result of one’s work. Empowerment requires the authority to make decisions and the resources needed to achieve the desired business outcomes.

For example, a vice president of sales was asked by her CEO to reform sales methods, to maintain sales results but to reduce rates of returned product, which were excessive. The CEO had engaged me to help her with reform. The vice president not only did not buy into the initiative but she vehemently opposed it. She felt it was not possible, as customers were enticed to buy with the understanding they could return unsold inventory. She insisted on reducing sales targets and resisted any discussion of reforming methods.

Rather than beseeching the vice president’s buy-in, the CEO accepted her right to disagree with the rationale of his decision but insisted that in her position she is responsible for implementing strategy as he decides. Establishing the vice president’s ownership while respecting her right to dissent worked. The vice president did not buy in at all, but that did not stop her from putting in a real effort to effect reform. Her sense of duty and professionalism were stronger than her aversion to the proposed change.

Buy-In Without Ownership

Buy-in is always nice to have, and buy-in and ownership are ideal in combination. However, it is only ownership that is needed for forward movement, not buy-in. In fact, buy-in without ownership achieves no progress toward change at all.

For example, the R&D organization in a client company of mine had a documented strategy for new product development and innovation. Everyone understood and agreed with the strategy. There was universal buy-in. However, year after year, there were no new innovative products, and only a handful of development projects, most of which were hopelessly stalled.

Sales and manufacturing teams use the R&D team for urgent support, and when a customer has a special request. Whenever there’s a quality control emergency at the factory, the R&D team is sent in like a crack commando team. The R&D team is on constant call, and the calls are frequent and always urgent. The R&D team has no ownership over its stated mission. Despite buy-in, the team remains passive toward the mission. Buy-in alone is not enough.

Buy-In Versus Ownership

Those who have high ownership and high buy-in of any change, initiative, or strategy will be committed, and that is the ideal. However, those who have high ownership but low buy-in will be dutiful, if also empowered and held accountable, like the vice president of sales who did not buy into the change, but acted on it anyway. While many leaders fear widespread resistance, passive or otherwise, without buy-in, in most cases professionals understand the need to do their jobs even when they don’t agree. They may not have the same fervor as those who buy in, but most will still be engaged nonetheless and act and make progress.

High buy-in and low ownership, however, results in passivity. People will agree with the direction you want to take the business and even accept it. However, they will have little impetus to translate that into their work if they feel little ownership and have not been empowered to the degree needed, like the R&D organization mentioned above. Low buy-in and low ownership results only in apathy. When ownership is low, even if you hold people accountable for results as a kind of threat, without empowerment to impact results there is little point in changing the way they do things whether they buy in or not.

Leaders Create Buy-In through Ownership

In the case of the vice president of sales above, her aversion to the change did not persist for very long. As reform began to work, the vice president’s skepticism faded, and she quickly became ardent about pushing forward with reform and trying new methods. There is nothing more persuasive than success. Within two months, her buy-in was even stronger than her resistance had been. Yet had the CEO waited for buy-in, he could have been waiting for years.

Ownership Trumps Buy-In

I never argue that buy-in does not matter, only that it matters less than what some people think. Always try to get as much buy-in as you can, but do not delay your plans because of insufficient buy-in. The key to progress is establishing ownership, not buy-in. Which is your priority?

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