Bad Decisions Make Good Stories

So, let’s take a dive into decision making in traditional and progressive organizations.

Decision-making processes

In progressive organizations we’ve seen all kinds of decision making. We’ve seen consensus building at the Brazilian self-managed company Vagas and at Morning Star we've witnessed the advice process.

There’s not one right way to make decisions. Some use a single process for all decisions. Others combine and match them to the decision being made.

At Corporate Rebels, we’re big fans of the advice process in its various forms. We (try to) use it as much as possible, because we want to stimulate everyone to take initiative and be entrepreneurial.

Decide how to decide

At the same time, we don’t believe one-size-fits-all. What works well in one organization doesn’t necessarily work in another.

Because of that, US-based organizational design collective NOBL created an app to help you figure out the best way to make decisions. Explore it here.

1. Autocratic

Autocratic decisions involve one person. He or she decides without input from others. While it has some severe downsides, it also has benefits in certain situations.

NOBL: “Autocratic decision making works well when there’s time pressure, when you have all the information you need to make a decision, and when your group is crystal-clear on what the execution would look like”.

The main advantage is that it’s fast and clear. The disadvantage is that it ignores the ‘wisdom of the crowd’.

2. Consensus

Consensus decision-making is well known. It’s about developing a decision in the best interest of the whole – a compromise that everyone agrees to. It includes a high degree of participation, inclusiveness, and collaboration.

The benefits are that it satisfies all participants and it involves many. Well done, all perspectives are incorporated. Some downsides? Consensus can be slow, it doesn’t work well when there are competing interests, and can produce half-baked compromises.

When is this useful? NOBL: “Gathering consensus takes time, but it works well when a decision will impact lots of people and those people have both valuable insight and the capacity for candid negotiation.”

3. Democratic

Democratic decision-making is well known. A group votes on various options. A majority vote decides the action. In short: the majority rules.

This process has upsides and downsides. The upsides include that it is perceived as collaborative, egalitarian and transparent. The downsides are that it’s easy to overlook minority perspectives, and it can result in a lack of group and personal responsibility.

So when is it best to use a democratic approach? According to NOBL, "Democratic decision making works well when choices are clear cut, when your team is well informed, and when your culture embraces majority rule."

4. Consent

Consent is another way to make decisions, but it’s heavily underused in many organizations. It is more often used in working approaches like Holacracy. The aim of decision-by-consent is to quickly make a decision that is good enough for now. If no-one has a reasoned objection, the decision will be implemented.

The process can vary. The one used in for example Holacracy looks like this:

• Present a proposal
• Invite clarifying questions
• Initiate a reaction round
• Amend and clarify
• Initiate an objection round
• Integrate objections

This process allows teams to move quickly, and to stay flexible. It means decisions can be tested in practice, rapidly. Learning from experience improves decisions as insights occur on-the-job. However, there are downsides too. The formal process can feel uncomfortable at first and can rush teams into a decision.

Usage of the consent process according NOBL: “Consent works well when speed is needed, when the proposal is clearly defined, and when the impact of the decision is limited and reversible”.

5. Delegation

Delegation is another decision-making process in progressive organizations. Even if hierarchical structures are still in place, the negative effects of command-and-control can be reduced by delegation.

Delegation means giving someone else the authority to make decisions and removing oneself from the process. Often the decision authority comes with clear guidelines (purpose, boundary conditions, budget, etc.).

The advantages of delegation are that it’s fast, motivating, and frees up time. The disadvantages are that it can be hard to truly “let go”, and needs practice to be perfected.

When to use it? NOBL advises: “Delegation works well when time is critical, when a single member of the group has the best information (and it isn’t you), and when the group is crystal-clear on what the execution would look like”.

For more on delegation and what it looks like to properly delegate, read this article.

Bad decisions make good storie

We’ve seen in our workplace visits around the globe that it’s crucial to clarify how your team (and organization) make decisions. Finding the right processes is a powerful way to become a better workplace.

So, although bad decisions make good stories, you don’t want you to make many of them!