What do you do if your financial decisions are being challenged?

I'm in the b2b credit management industry and I see issues in our customers businesses every day. There has always been a strained relationship between a companies sales and credit teams, and if the credit manager declines a credit application, many times sales-oriented companies (owner or CEO is sales oriented), they override the credit manager's decison, and grant credit anyway. In the majority of these instances, the company comes to me when the debt isn't getting paid, and the Credit Manager is scared to say " I told you so." Finance professionals are hired for their expertise. Be sure to lay out your reasons in a very simple and practical manner. If the executive team is inclined to go against your advice, document your convo with them

I'd welcome the challenge as it shows interest. I'd make sure that I fully understand the basis of the challenge - is it because of a difference in risk appetite, concern over the validity of the data, or underlying assumptions for example. Or is it that the decision will, by default, trigger change and this person is uncomfortable with that or how it has been communicated. It's really important to probe around what is really being asked and to properly listen to the response, and not make assumptions and jump to a defensive position and / or wade into the detail behind the numbers when actually its not the actual finances at all.

Review your facts and decisions carefully. Test to satisfy yourself that the decisions are sound. Brain storm with a professional colleague. Understand why it is being challenged and where could you have gone wrong.

One of the most factors that affect any challenge is to be neutral, fair and far as you can from cognitive biases so you can see a clear picture then the decision will be better. Gathering information, collection of facts and taking experts opinions are supporting factors here.

Avec du recul, la plupart des disputes relatives à une décision financière viennent d'appréciations divergentes sur la nature et l'étendue du risque qu'elle implique, ou leur aspect plus politique, car une décision financière sous-tend généralement l'équilibre des pouvoirs et intérêts dans une entreprise. Les décisions financières sont donc parfois trompeuses car elles sont souvent présentées comme objectives, alors qu'en réalité elles sont marquées par des considérations plus subjectives, sur l'appréciation du risque ou l'équilibre contractuel entre les parties.

I have found that in a situation like this, it's typically not the financial analysis that's being challenged, but rather the assumptions behind the analysis. One thing that I have found helpful in these situations is to not attempt to refute or discredit the challenge, but rather, address the questions as valid and affirm that the analysis is based on certain estimates and conclusions of how things will proceed. Then, I may show how the analysis looks if the estimates are not as good as anticipated. Often, the go forward decision even with less positive estimates and assumptions is still positive or at the least, neutral and positive from a qualitative and strategic standpoint. That usually helps ease concerns and win support.

Discuss your financial decisions clearly and confidently. Explain the logic, data, and assumptions behind your decisions, and how they support your financial objectives and strategies. Use relevant examples, evidence, and benchmarks to back up your claims, and avoid jargon, ambiguity, or exaggeration. Be prepared to answer questions, address concerns, and acknowledge feedback, but do not let yourself be intimidated or distracted by irrelevant or personal attacks.

The key here is to acknowledge the challengers' perspective. Once you've thought through opposing ideas, you must appeal to the challenger emotionally and rationally, which is why it's important to understand the challenger's motivation. Social proof, evidence & examples are ways to influence the challenger.

As an angel investor, the best (and sometimes worst) exercise was reviewing pro formas with entrepreneurs. The primary exercise for me was to determine if they understood enough about running, operating, and growing a business. Did they budget for all their OPEX and CAPEX? Are they buying a plane for themselves... (hard pass thank you). It allows entrepreneurs to explain their strategy and how they will accomplish it with their "use of funds" and the investor to ask delving questions based on that summary. That all said - most of a pro forma is bullshit and not predictive enough - but is still an excellent thought exercise. Quickly weed out pure dreamers after unicorn exits and real business people who can execute and provide returns.

Show the data. If the same perspective is available from multiple sources, it's relatively easy to back your decisions. Let the other person see the logic in your reasoning. Most folks understand visually. If they can actually see how the numbers are arrived, it's hard to dispute.

When a challenger is more vocal than usual, i usually like to take their perspective and adopt it into my financials. That way, we can all see the impact of their perspective and then start pointing out and discussing major areas of impact. By doing this you show credit and keep an open mind of other perspectives that my improve your own.

Listening and learning from the challenge is indeed crucial for personal and professional growth. Even if you disagree, there's value in understanding diverse perspectives that may enhance financial decisions or outcomes. Demonstrating respect and empathy for the challenger fosters constructive dialogue. Asking open-ended questions, paraphrasing, and summarizing ensure mutual understanding and prevent miscommunication. Avoiding interruptions, arguments, or dismissals promotes a collaborative approach to addressing challenges.

Embrace the challenge. If you are not challenged, you will not learn. Not saying it's easy. The first emotion is often an angry push-back. Put space between the challenge and your emotion. Take a breath and see it as an opportunity to learn.

In my experience, I have found that throughout the conversation, stay calm and professional even if you disagree. This is a chance to collaborate and work with each other not against each other. Keep an open mind to their point of view and address their concerns directly.

Absolutamente de acuerdo con escuchar y aprender. En estos tiempos es tan amplio el abanico de inversiones que hay que entender que uno actúa en base a sus modelos mentales... Cuanto más importante es conocer otras tantas formas de invertir. Ver qué ven esas personas que nosotros no estamos viendo... Una frase que amo es 'las personas inteligentes aprenden de todos y de todos, las personas promedio, aprenden de sus experiencias y las personas estúpidas, tienen todas las respueatas'

I was just talking about this with a friend. A great deal is typically where no one is completely happy. Neither side walks away with everything they wanted - but neither side should feel like they were taken advantage of either. Create the win-win - and be willing to compromise on items you can live with, and do not compromise on those you cannot. You'll regret it in the long term, and there are always going to be future deals - you just have to find them if you pass.

REVISE your decision, make amends: * Whose money is it? => It is the owner of the invested funds who bears the risk. If you do not own a share in the investment but only advise, you have to find a solution. COMPROMISES may work well, but are sometimes not enough to restore investor confidence: => Change your decision to be the best possible when taking the newly learned facts into account.

In investing, I don't think negotiating and compromising work well. In the end, you need to look in the mirror and decide because you need to take responsibility for decision-making. Personal finance - I agree that negotiating might be a better idea. If you have a spouse, make sure your goals align first, and then you can each give and take from financial priorities.

Due to losing my job 7 months ago and it being the 2nd hardship I was hit with in the last 2 years, I decided to work out an agreement to Consolidate my Debts and work with trying to get to negotiate a payoff amount less that what was owes. though this will take a few years, I realized I did have too much credit cards and only am keeping a couple.

El fin de todo trabajo es que llegue a su realización, en cada trabajo y cada proyecto es terminarlo, sin embargo no siempre se acepta en los términos que se tienen proyectados, por eso es preciso dentro de la planeación tener los límites establecidos para saber hasta que punto se puede alcanzar a los acuerdos en que ambas partes tengan beneficios.

In my experience, I have found that there might be a way to meet in the middle. Explore options that address their concerns without compromising your core goals.

Due to this experience being humbling, I am certainly going to work on maintaining a no dependence on credit and only use it when it can be paid off the next month. To work on only paying for things with money in my account. Regardless if I can get back to the income I made before 2023, as I don’t want to make the same mistakes again.

I am always open to hearing why someone feels a certain way about something. Especially when it comes to investments. I always go over the facts that lead me to my decision. Sometimes just looking at something from a different angle can lead you down a totally different path.

Well, all of the above do apply as the dynamics of our economy have always been challenging as least as far back as I recall in the finance world, as a bank teller at 18 years of age seeing CD rates at 18%, back in the day …

Do not lose your FACE: * Was your decision really a mistake? => Correct it and ask for understanding and forgiveness. * I am right, but my client does not understand why..! => You have to make a greater effort explaining your decision and its consequences, looking to make investors understand.

Sometimes our decisions might be overruled by top management despite we have tried our best giving the justification and rationale. Don’t be despair and take it too personal. May be there are things and areas of concern where we never thought off. If any possible chance, try to look for suitable avenue to get clarification so we could have the opportunity to learn where we are lacking of and improve in the future.

Managing wealth has many responsibilities. I would always consult potential solutions with 2 to 3 leaders for input, insight and risk.

Find investors and investments that live in your same "wheelhouse". Local investors partnering with local entrepreneurs can be leveraged a lot more than remote. Local networks will be strengthened. Shared expertise by partnering with investors/entrepreneurs who both know the business/industry being invested in also can leverage the scales in your favor greatly. Again stronger networks in that sector with existing and future partnerships can provide you with higher returns and faster growth.

The reason of challenge is imperative to understand. Such decisions can not be driven with arrogance and be used as a sign to display authority. It has to be backed with logic and reason. Cash flow management has to be simultaneous to risk, as per risk appetite.