One way to look at business success is simply as a series of decisions, large and small, made over a long period of time. Should you hire that person, reorganize your sales team, invest in that new market, or build that new facility. Then within each of those larger decisions there are smaller sub-decisions that must be made, each one taking time and thought. When you think about a business as simply a series of decisions you can see why some people who have had success will consolidate all decision making within themselves and micro-manage. They want to control the decision making to ensure there are no mistakes. Yet that doesn’t scale because as you grow the company the number of decisions to be made grows too. It also doesn’t allow for the diverse points of view that will help your decision making be even better than you could make on your own. You need a structure that enables effective diverse decision making.
Let’s assume you have some business units or functional departments and you’ve delegated leadership and management of those areas to specific managers. Here’s some ideas on how to implement effective diverse decision making within that structure:
1. Guiding paths—One way to ensure that decision making follows a pattern that is consistent with the culture and goals of the company is to create a guiding path or overall framework for decision making in each area. This is a higher level of structure above the daily operations of that area that may include the mission of that department and other high level principles that should govern the decision making. For example, if it’s the marketing department, maybe you create a creative preferences document that outlines the look, feel, and tone of all marketing. That way when individual marketing campaigns are launched, the manager of that area can make decisions about them on their own without always getting every detail approved. Get consensus on the guiding path first and then daily decisions will happen a lot faster and with less oversight.
2. Thresholds—With a guiding path it’s also helpful to set thresholds. The most common implementation of this is spending thresholds for purchase decisions, yet it doesn’t have to be quantitative. You can set qualitative thresholds for decision making that govern when one manager has to get other managers or executives involved. For example, one manager shouldn’t be able to unilaterally make decisions that affect other areas. The threshold could be if a decision affects processes within other peer areas, then the decision must be made at a higher level, or the manager must use a collaborative decision making process involving the other managers. If it’s a decision that involves the entire company, it’s helpful roll out an even bigger process with multiple chances for feedback.
3. Process—You can scale the decision making process for the size of the decision. For small decisions that affect a single department, managers can have a quick discussion about these decisions with their team and then just move forward. For larger decisions it helps to frame up the decision in a clear concise document and circulate that document among as large a group of people as you feel is appropriate. Maybe it’s only the leadership team, or in certain cases with very large decisions you may circulate this document to the entire company. You aren’t looking for someone else to make the decision, but you are looking for diverse feedback and trying to gauge how people will feel about the decision.
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