As humans, more often than we’d like, we use our amygdala when confronted with the need to make quick and urgent decisions. This is the Fight/Flight/Freeze portion of our brain. This part of the brain is designed to help keep us safe from nasty predators and other life-threatening scenarios. Thousands of years ago, it protected us from saber-toothed tigers. Today, we engage that portion of the brain when confronted with very different types of frightening situations.
Neuroscientists have discovered that the portion of the brain that is activated when suffering financial losses is the same portion as when our ancestors were being confronted by that saber-toothed tiger.* Humans are hard-wired to treat financial loss as a life-threatening predator. This is why, when faced with the decision to implement a new financial technology or solution that has a cost, but the potential for significant value, we either:
- FIGHT: Deny the information being presented and convince ourselves that the cost of change is too expensive. Example: “I could hire another head count for that price, no thanks.”
- FREEZE: Get stuck and do nothing. Example: “I can see the value and agree something should be done, but we’re not in a position to move forward at the moment.”
- FLIGHT: Ignore and focus on another less daunting project. Example: “I can focus on the new whiteboard purchase for the boardroom”.
Let’s focus on Flight.
Traditionally, flight has its advantages. Run away fast enough and you survive. The trade-off of not taking the perceived risk though, is not getting the required benefit; food, shelter, or a mate, in our ancestors’ time.
The same principle applies today when implementing new technology, Accounts Receivable automation, for example.
You have a clear need; increased profit, reduced costs, differentiation, improved CSAT or even improved ESAT. Perhaps you have found a solution that claims to address your needs, perhaps it’s an Accounts Receivable cloud platform. As you get closer to making a decision, you realize there is an investment required: money (monthly fees and initial set up) and time (implementation efforts and internal training). If the solution doesn’t meet your objectives, you are looking at a potential financial loss. Et voila, the amygdala engages.
“What to do? I need to make a decision, what if I spend the budget and it fails, I will be ridiculed etc. If I engage and it works, I’m a hero… Or, if I ignore this one…. Maybe I should move on to something less critical, I won’t fail if I stay in my comfort zone, I can survive." Or can you?
In the past, it was all about competition.
When running from a saber-toothed tiger, you didn’t need to outrun the tiger, you just had to make sure you outran someone else. This still applies today. Your competitors are transforming their AR processes. They are automating tasks, improving the customer experience via self-service and collecting their money faster. This change is inevitable and fleeing from an inevitable change has costs in the modern age. Look at the fallen giants of the past: Blockbuster, Sears, Kodak, etc.
Fleeing, fighting and freezing are no longer the safe options when disruption is inevitable. To survive in today’s world, when faced with the risk of financial loss, you need to change and adapt - hopefully faster than your competitors. Save the amygdala for the saber-toothed tigers.
Now, this doesn’t mean you should throw yourself blindly into every new AR technology that comes your way.
I recommend the 5 Rs:
- Research: Prepare, prepare, prepare. Find out what your customers/stakeholders want, get their opinion(s). Will this project make their life easier? Will it make them happier? More supportive? Look around, what are your competitors doing (or not doing)? Will this move help you differentiate?
- ROI Analysis: Now this one is a bit tricky, as we normally focus on the tangible: Cost vs. Savings. Seems simple enough. But what about the intangibles? What I see happen far too often is that if you cannot quantify the ROI (like with CSAT or ESAT, for example), its disregarded. The solution costs X, and provides Y. If that’s a negative number, the decision tends to be not to move forward even though intangibles such customer or employee experience are positively impacted. Take the time and consider the intangibles. Define as best you can what they would cost you. If 10% of my customers stay with me because I am easier to do business with, if I could bring 10% of my competitors’ business over… What is that 20% worth? What if my employees are 10% happier coming to work? 10% less attrition. These are real tangible benefits if you take the time to do ROI analysis right.
- References: Ask for them. Not every vendor wants to give a reference, but the truth is that if you cannot get feedback from an existing customer, you should be concerned. Flight might be a good response in such a case.
- Revisit Your Gut: Not as technical as the first few, but intuition plays a huge role. How did you feel when learning about the solution? Did it resonate with you? Did you envision what this would look like once implemented? Those initial feelings, once revisited, will either remain or disappear. Humans are programmed to survive, never discount your intuition.
- Review: You have objectives and needs. Review the solution and its ability to address them, and perhaps some of the other things the technology allows for.
Hopefully, with the few steps above you can take the time to recenter yourself and not run blindly away from a necessary change. That being said, if you are that adverse to modernizing your AR, I think I have an old VHS player I could sell you. Oh and no, I don’t accept checks. ;)
For more information, please contact us for an initial conversation or to schedule a demonstration.
*Zweig, J. (2007) Your Money and Your Brain: How the science of neuroeconomics can help make you rich. New York: Simon and Schuster