What the Decision-Making Process Looks Like

Does this remind you of your organization’s decision-making process?

It’s almost two o’clock on a Wednesday. You just got back from lunch (or maybe your dining room table). As you settle into your office chair, you exhale a deep sigh of freedom. You’re re-energized and ready to tackle a bunch of important tasks that you haven’t been able to get to. The afternoon is yours!   

Or is it? Out of habit you glimpse over at the clock, only to be confronted with a truly terrible sight that shakes you to your core: you have a two-hour team meeting that’s about to start. Alas, your peaceful, productive Wednesday afternoon is not to be. It was sacrificed—yet again—to the insatiable god of unnecessary meetings

If you’re anything like the typical American manager or office worker, there’s a very good chance that you can relate to this scenario. You may even be unfortunate enough to experience it weekly. The tyranny of Too Many Meetings is one office plague that knows no boundaries; whatever your industry, company size, or role, you are at risk. 

What Is the First Step in the Decision-Making Process?

Opening up your thought process to diversity

While numerous factors can contribute to a workplace that relies far too heavily on meetings, in my experience there’s one consistent culprit: a poor institutional decision-making process. In too many companies, meetings are not simply a means to an end, a tool to be used judiciously and efficiently, but the end. In these companies, meetings are meant not to solve problems but to show that a manager is “doing something” in the face of a challenge.

When a company operates like this, it tells me that their people don’t feel 1) comfortable in their roles or 2) empowered to make effective decisions. It tells me that system-wide decision-making is poor or nonexistent. And, probably, so is trust.

Unfocused, time-sucking meetings are a major symptom of this breakdown, but not the only one. Poor organizational decision-making processes can lead to other significant problems as well, such as: 

  • Confusion over decision rights 
  • Competing priorities
  • Rogue task forces and councils

In healthy companies, managers and employees know exactly what the scope of their role is—and, critically, feel empowered to act both strategically and confidently, secure in the knowledge that they have the authority to do so. 

Unfortunately, however, companies with this level of institutional competence seem to be more of an exception than the rule. A 2017 McKinsey survey of more than 2,200 executives, for example, reported that 72% of leaders think bad strategic decisions are either as frequent as good ones or the prevailing norm in their organizations.

That’s the bad news. The good news is that there are several important steps you can take to improve the decision-making models in your organization.

6 Steps in a Decision-Making Process That Works

1. Identify what decisions need to be made

Breaking down the types of decisions your organization makes on a regular basis is a good way to figure out who should be in charge of deciding what. When I work with clients, I start by sorting decision-making into three categories: corporate decisions, strategic decisions, and operational decisions.

  • Corporate decisions include setting vision and direction for the company, appointing top leaders, defining company values and culture, and managing external reputation.
  • Strategic decisions include decisions about investments the company will make, which customers it will serve, capital expenditures, and setting corporate policies that all employees must comply with.
  • Operational decisions include budgeting, developing and launching products, and managing talent.

You may choose different categories depending on the size and maturity of your company. The key is having some way to sort the types of decisions being made to ensure the right people are making them.

2. Determine who should make which decisions

Decision rights must be distributed thoughtfully to ensure everyone is clear on the boundaries imposed by their departments and roles. One major factor to consider is the level a decision should take place at. Place decisions that will affect the company at large and need to be made centrally at the enterprise level. 

Decisions that must be discretely made for functions or geographies should take place at the department or business unit level. At the local or individual level, place decisions that must be made with the uniqueness of employees and teams in mind.

In some companies these boundaries are more much more fluid or even nonexistent (more on this in a moment). But for most companies, segmenting decisions into categories and levels will help managers and employees better understand where their authority begins and ends, which will in turn empower them to act when something falls into their unique domain.

Quotation Call Out

The best executive is the one who has sense enough to pick good men to do what he wants done, and self-restraint enough to keep from meddling with them while they do it.

– Teddy Roosevelt

3. Connect governance groups

Decision-Making Process

Once you’ve identified which groups have the authority and resources to make which decisions, the next step is to link them to ensure effective coordination. None of these groups are making decisions in a vacuum, and many rely on each other to execute their choices.

Governing groups must make an effort to regularly exchange critical information. It’s essential for each group to stay informed about changing market conditions, those aforementioned corporate, strategic, and operational decisions, and other news. A meeting is probably going to be the best venue for this sort of exchange. 

This being the case, it’s essential to manage meetings with directness, clarity, and efficiency. Participants should expect concrete information to flow into their meeting, and final decisions and step-by-step actions to come out (or a promise to provide them shortly). 

At the end of each meeting, everyone should know what is being asked of them—and what’s not. This is no place for vagueness or wishy-washiness. People can accept bad news, as long as it’s offered respectfully.

4. Beware decision compression

Decision compression happens when a more senior person withdraws decision rights (either voluntarily or as a requirement) from a more junior person and assumes the role of the decision-maker. When this happens there are three parties impacted. 

First, the junior person, who isn’t being developed to deal with obstacles, becomes confused about their role and frustrated by the redundant work when their boss becomes involved. 

Second is the senior person who is working at the wrong level (WAWL). They are too far in the weeds and focusing on fighting fires, blinding them to the broader factors impacting their business. And the last person is the client, who suffers the consequences of delays in service, increased costs, poor customer service, and a high degree of frustration.

5. Give people space to do their jobs 

In the words of Stephen Covey, “You can’t hold someone accountable for results if you supervise their methods.” Pick your battles; know when to get involved and more importantly when not to get involved. Be prepared to support your team members when they fail, which is a significant shift from preventing failure.

Letting people do their jobs can mean many different things to different organizations. At one end are companies like Zappos and Zingermans, where employees at every level are essentially allowed to do whatever it takes (within reason) to solve the problem and take care of customers. Their management defaults on trust; it’s assumed until proven otherwise. (For what it’s worth, it’s probably no coincidence that these companies make “Best Places to Work Lists” year after year and are customer-centric legends.)

Call-out/Tip

The foundation of making good, informed decisions is, well, good information. The more time you spend upfront gathering data and truthfully weighing pros and cons, the less time you (or the decision-makers you’ve empowered) will spend later on as you’re forced to deal with the aftermath of a hastily made decision.

6. Set it and forget it (well, almost)

Depending on your current situation, this sort of autonomy may feel too extreme for you, especially if there have been recent shakeups that have lowered morale among employees. So you don’t have to go whole-hog immediately, if ever. There are degrees of decision-making models. But if you’re worried your organization has been too constrained by endless meetings, bureaucratic red tape, or rigid hierarchies, you could dip your toes in the water by giving some additional authority to lower-ranking staff and then increasing things from there.

The bottom line is that well-functioning companies don’t waste time constantly figuring out who’s going to decide what. They establish it definitively, then make adjustments as necessary if things change. Once this is set, their business decision-making process models are all but automatic. With every new decision point they gather relevant information, choose among alternatives, and then, with confidence, embark on a course of action. Going back and forth about it at yet another endless meeting is rarely necessary. When the clock strikes two, everyone knows just what they should be doing.

Everyone Feels They Understand the Step-by-Step Process of Making Decisions

And, yet, somehow pros and cons are overlooked, someone forgets to weigh the evidence

Identify the decision-making sandpit your organization lands up in so often, and how you can make getting to rational decisions easier.

See How We Help Streamline the Decision-Making Process

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About

Ron Carucci

Ron has a thirty-year track record helping executives tackle challenges of strategy, organization, and leadership — from start-ups to Fortune 10s, non-profits to heads-of-state, turn-arounds to new markets and strategies, overhauling leadership and culture to re-designing for growth.

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