March 18, 2013
The Nature of a Compelling Argument
How High Is The Bar? - Most people don’t part with their money easily. So if you want someone to buy your product or invest in your endeavor, you need to make a pretty compelling argument. Often, utility staff members expect policy makers to easily trust that their rate-increase proposals are necessary. This is an unreasonable expectation. When it comes to money, trust never comes easy. Investment proposals must meet a high standard, characterized by extraordinary clarity and highly-relevant information. The foundation for trusting a specific proposal is the utility’s brand (or trust in the organization). No proposal is compelling if it comes from someone you do not trust. But a strong organizational brand must be accompanied by a strong case for investment. For water-utility managers, the bar is especially high because policy makers often feel uneasy about the consequences of supporting a rate increase. Furthermore, they and their constituents typically have preconceived notions about the efficiency of government organizations and government spending. Clearly, a compelling argument needs to be so clear and meaningful that it displaces current thinking and ideologies. This allows policy makers to fully appreciate the logic of the proposed investment.
How Should It Look? - A compelling proposal provides the rationale behind an investment in clear and precise terms, for example by:
· Describing the fundamental roles and commitments (promises) of the organization
· Reviewing ongoing efforts to increase operational efficiency
· Providing meaningful transparency
o Which means listing the key standards, driving forces, or other motivations for recommending the investment
· Stating the problem to be solved
o Which can be a current problem or one that will manifest in the near future if action is not taken
· Emphasizing and explaining significant financial standards and challenges
· Justifying the timing of the proposed investment
· Communicating the ramifications of failing to invest or delaying investment
o Typically in terms of reduced service reliability, increased risks, or higher costs in the future
What Doesn’t Belong? – Technical, financial, or any other facts that don’t make a relevant point or clarify the argument for investment.
How Should It Feel? - Policy makers should feel “compelled” to support the investment. More specifically, they should get a strong sense that voting no will be difficult to defend. A compelling argument exposes a “no” vote as being motivated by things other than meeting the utility’s operational and financial needs.
What Do The Results Mean? - A vote that tracks political-party lines or ideological beliefs means that the argument was not compelling. Therefore, the standard for a compelling argument is a unanimous decision, despite the fact that this is not always achievable (especially with large governing bodies). However, the unanimous-decision standard is suitable because it encourages the utility’s staff to take responsibility for the result, and continue to improve their planning and investment proposals.