2. Decisions…
Decisions pushed down (and in real time)
When a decision is made by a management team in a satisfactory way, it can create a good feeling of completion and achievement. But if that decision could have been made at a lower level in the organisation, then completion and feeling good about it don’t equal effectiveness. Always push decisions down to the lowest possible level.
Decision making is a key ingredient of the operating model of any firm and it’s also one that generates a lot of frustration. People want better decisions or faster ones. They complain about the lack of decisions or the difficulty making them. However, one of the key problems that I encounter in my client work is not the lack of decisions, but the abundance of them! The problem is these decisions often don’t stick. Nobody really takes them seriously and people simply wait for the decision to be reversed or modified or for it to simply fade away. And that’s the real problem!
A whole discipline of ‘Decision Sciences’ are taught at universities. In large organisations, some form of this may even be represented at a department or group level to assist portfolio strategy or management. But I am not talking about the mechanics or even the attributes: quality, speed, etc. I am focusing on ‘where’ the decisions are made. And I suggest implementing a simple disruptive rule that I call ‘decision making subsidiarity’. I unashamedly borrowed the term from the European Union (EU) political jargon. In that context, subsidiarity means that if a country can do/be responsible for X, this is something country X should do/be responsible for. Or in other words: it should not be done at the higher EU level. I think this is also a key rule for organisations: if a decision can be made at a lower level, it should be made there and not higher up.
Many management committees I have worked with function very effectively, focussing on decisions made, problems solved, etc. Meetings end with a good feeling of accomplishment. I always push back: could that decision have been made somewhere else? Somewhere lower in the system? Perhaps even earlier?
If the answer is, “Yes, our own teams could have done this actually” or “Yes, this could have been done at a local sales level“, then that management team is de facto hijacking decision power from somewhere else.
In the era of organisational flattening, there are less and less layers of management. We are happy about getting rid of hierarchies, but we are less good at understanding the associated liabilities. If a layer of management disappears, decision making (or ‘decision rights’ as it’s often called) should go to the lower level and not to the higher one. A reorganisation where layers go down from 6 to 3, but where senior management absorbs most of the decision rights that became available, is a reorganisation that should raise many questions!
A consequence of decision making being pushed down is that there are many new ‘decision homes’ where empowered people could make a decision on the spot. One of the big problems associated with decision rights flowing upstream, to a higher level, is that these decision rights tend to go or be deferred to the management bodies that only meet from time to time! They are the antithesis of ‘Team 365′.
So, pushing the decision rights down to a lower level also means that many decisions could be taken ‘in real time’. Provided that people are empowered to do so, there is no reason why they should delay the decision making process. Pushing decisions downstream and making decisions ‘in real time’ as much as you can are two simple disruptive rules. They won’t cost much but they have the power to transform your company on a big scale.
Implement decision making subsidiarity across the board.
If something can be decided at a lower level, it should. And you should make it lower and lower all the time.
If nothing can be decided at a lower level, you are the problem.
Your management goal is to decide less and less every day.
‘Closure’ and decisions made in meetings and committees may be efficient, but not necessarily effective if it could have been done at a lower level.
The amount of ‘deferred decisions’ (as opposed to real time ones) in your organisation is a good indicator of your agility and empowerment.
