How to overcome ‘decision paralysis’, according to one CEO
Raconteur’s recent research found that, 94% of the time, a decision in a business will involve at least six people. A fifth of the time, more than 16 people will have an input. Do those numbers surprise you?
No. What you find in a lot of businesses is a lack of distributed accountability. If you take the RACI model [a responsibility assignment matrix used in project management], there are people who are responsible, accountable, consulted and informed. But firms often leave out the ‘accountable’ element. They create several management layers, meaning that someone else somewhere up the chain becomes accountable for what you’re responsible for delivering. That’s where decision-making breaks down, because each person ends up covering their own back.
An unbelievable amount of decision paralysis happens in business because no one wants accountability. The problem is that, if someone is three positions removed from a decision but is accountable for its outcome, they will want to know all the details. Even if they do know them all, they probably don’t understand them. So it becomes a massive job to make them feel comfortable enough to sign off on the decision.
Jellyfish has dumped the ‘responsible’ aspect of RACI. In effect, this means that if you’re responsible for delivering something, you are also accountable for it. The only decision that must be made by committee is to determine who the responsible and accountable person should be. That individual is then empowered to make the relevant decisions.
How should businesses decide who is accountable?
When we make someone accountable, it’s based not on seniority but on the person having the relevant experience and/or granular understanding.
The only accountability the others have is that they were part of the collective decision to make that person accountable. If that doesn’t work out, you still have the rationale for the choice you made. And it also means that everyone, when they’re making their decisions, can’t fall back on someone else or try to cover their back.
Does that place excessive pressure on the person who is deemed accountable?
Most corporations work based on one person being accountable for everything. That would be like me, as CEO, being accountable for every single thing done by the 2,200 people who work for Jellyfish. I will get either the blame or the credit. But I don’t want to take the blame or the credit. I want people to make the best decisions.
It doesn’t matter what level someone is working at if they’re unequivocally the best at something. How can it be too much responsibility for the most qualified person in the organisation to own a particular initiative? It means that you get the best-equipped people making the decisions, owning them, taking accountability, learning from them and optimising their approach. By distributing decision-making and accountability this way right across the organisation, you make the business more agile and productive.
Why has decision-making become so complex at most companies?
A way of working has crept in whereby there’s a common situation in which people in highly paid roles are reliant on the system. [There are many executives in many companies], far removed from the actual execution, who are there to manage people and sign things off. It’s crippling for a business when the smallest things have to be approved at C-level.
If you have the right system, people can take accountability for their decisions, which don’t have to be big calls to start with. When they see the results of their choices, they will learn and make better ones about bigger matters in the future. That’s what empowers them. It’s how they evolve and become more competent decision-makers.
What problems are caused by a lack of accountability?
The big one is that decisions aren’t made. I live by the philosophy that more is lost from indecision than a wrong decision. Companies that procrastinate miss opportunities. People are happy to use the clichés ‘learn fast, fail fast’ and ‘learn from your mistakes’, but you can’t do that if a decision wasn’t taken in the first place. (That doesn’t mean being reckless, of course. You can mitigate risk by consulting the right people and establishing checks and balances.)
If you make a decision, you can often make adjustments later. But you can’t bring back an opportunity you’ve lost. If a company gets in the habit of blaming decision-makers for constantly changing their minds, that will create paralysis or the feeling that you must stick to a course of action, even if it turns out to be suboptimal.
It’s a hard balance to find, but at Jellyfish we try to be agile and develop our decision-making. We encourage the business not to hold someone to account for a call they made three weeks ago [if it’s overtaken by unexpected developments] – an economic crash, for example. Decision-makers have to be able to work with the best information available to them at the time.