5 Best Practices To Distribute Decision-Making
An important feature of traditional organizations is centralized authority. This suggests decision-making competence rises with level in the hierarchy. This is obviously nonsense.
The system is broken
The result of centralized authority is mostly frustration. It leads to responsibilities being avoided, inertia and endless ‘coordination’—without actually making decisions. This archaic approach is not only lethal to the organisation it also spreads frustration.
Employees experience this on a daily basis. It is the frustration of not being able to make your own decisions: of having everything you do verified, checked, approved and signed off, until all joy, ownership and responsibility have evaporated. In this regard, the system is broken.
The Rebel Idea
After visiting 100+ of the most progressive firms in the world we conclude that progressive organizations tend to be highly decentralized, with decision-taking processes distributed throughout the entire organisation.
They believe frontline employees have the best understanding of customers, suppliers and production machines. Therefore, frontline employees should make most of the decisions.
Distributed authority and decision-taking processes are seen a lot in progressive companies. But don’t chill too soon: this freedom is accompanied by responsibility.
Rebel Idea in practice
So, how to start? This is where we come in. We have a number of best practices to distribute decision-making. We start simply and work up to more radical options.
1. Map decision-making
Start by mapping the current decision-making system with an overview of who makes what decisions. Don’t complicate this. You can do this in a single morning.
How do you do this as a team? Simply gather your colleagues around a large whiteboard, and together build an overview of who is allowed to take what decisions. Ignore decisions that happen once in a blue moon. This is about the basics. The rest can follow once you start implementing change.
Keep this overview visible afterwards, so everyone knows where they stand.
2. Change the language
A second, relatively simple, practice is achieved via the power of words. It was one of the most important practices David Marquet used on the USS Santa Fe. He changed the language throughout the organisation and showed that this can be a powerful step to distributed decision-taking culture.
In your organisation try to avoid passive phrases like: ‘I request permission to…’, ‘What should I do about…’, and ‘Do you think we should…’.
Instead, replace these passive phrases by active phrases that imply a certain level of initiative and ownership. Try to use phrases such as: ‘I intend to…’, ‘I plan on…’ and ‘I will…’.
Using these phrases can change the decision-making culture. Apply discipline by using them constantly. This is crucial for success. It not only changes the dynamic of conversations, but also promotes initiative-taking and entrepreneurship.
3. Push authority down the org chart
Once it is clear where and by whom decisions are to be made, it is time to distribute this down the chain of command, step by step. To make this happen, ensure everyone searches for practices and procedures that hold people back from taking their own decisions. Search for control mechanisms that lock the command-and-control culture in place.
To change the way the organisation controls decisions in an enduring, personal way, you can follow another of David Marquet’s best practices (which we have adapted slightly):
- As preparation, all team members identify policy documents where decision-making authority is specified.
- All team members gather in one big meeting room and write all decisions on a big whiteboard.
- All team members leave the room, except the team leader(s).
- Team leader(s) identify decisions that are candidates for being pushed to the next lower level in the organisation and stick post-its next to these candidate-decisions with the following sentence: “When I think about delegating this decision, I worry that..”.
- Once finished, the team leader(s) leave the room and invite the team members to enter the room.
- Team members identify decisions they want to take authority for, and comment with post-its to the candidate-decisions by following the sentence: “You should not be worried. We feel comfortable in making this decision, because…”.
- Once finished the team members invite the team leader(s) back into the room and discuss the post-its in a constructive way.
Henry Stewart, CEO of a British training bureau with the appropriate name Happy, introduced us to another interesting practice: pre-approval.
This is how it works. A leader or manager approves something in advance, before the employee has made a decision, or even thought of a solution for the issue. This approval is given on one condition: a number of guidelines are set up.
Those guidelines are the rules of the game. What is the maximum amount of money something can cost? What are its minimum requirements? How much time is it allowed to take?
It is up to the leader to pre-approve the implementation of whatever decisions, solutions or ideas the employee comes up with. And if it doesn’t work, it is their fault. With this freedom, comes more responsibility.
5. The advice process
Implementing the advice process is the most radical approach to distributed decision-making. It is an alternative to slow consensus. It is something we saw in many shapes and sizes (at Dutch Finext, Brazilian Vagas, British Smarkets, and tomato processer Morning Star in California).
We have simplified these forms, and they can be used as follows:
- Someone within the organisation sees a problem, an idea or a chance, and takes the initiative to be a decision-taker. If this person thinks they are not right for the job, they can ask someone else to take over the role.
- The decision-taker makes a proposal for the decision, with or without input from colleagues.
- The decision-taker gets advice from people directly involved with the decision, and/or experts in the subject under decision.
- The decision-taker ponders on this advice, and then makes a decision. The advice can be taken on board, or ignored. The decision-taker has the final say.
- The decision-taker takes action, and informs all those involved about the advice they received, and the decision eventually taken.
These steps clearly show the process is not about reaching a consensus. Not everyone has to agree with the result of the decision. Not every source has to be used. But the decision-taker has to get enough advice to take an informed decision.