Putting Together Your Company's Decision-Making Structure - dummies

Putting Together Your Company’s Decision-Making Structure

By Dawna Jones

The best organizational structure is one that offers clarity, flexibility, solid processes, and agreements about how decisions are made; clear communication regarding goals; and ways to monitor and provide feedback. Such structures create the stable framework upon which working relationships can function effectively.

The methods you put in place must be clear, thoughtful, and intentional, and you must be willing to adjust as your company’s relationships evolve. To agree on the decision-making process you want to work with internally, follow these steps:

  1. List all the decisions you typically make in a day, week, month, or quarter.

  2. Identify who is best positioned to make the decisions you list in Step 1, based on speed, access to information, or other key criteria.

  3. For each type of decision, create guidelines for who to include, which process to use, and which shared company values apply to the decision-making process.

    Include the following kinds of information in your guidelines:

    • The decision-making tools to be used: Select and apply your own principles to fit your business. If a decision-making tool like dot voting will work, then use it. If you need something more sophisticated, then select a tool that fits the importance of the decision and the need for employee input. Cocoon Projects, for example, applies the principle of using the smallest tool possible to get the job done.

      By matching the decision-making tool to the kind of decision, you replace random decision-making with a process that ideally ensures employee contribution, resolves issues quickly, and is relevant to the situation. In short, you gain speed and accuracy.

    • The amount of time allocated for each level of decision: This timeline marks the time available from input through to the final decision. Some decisions, depending on their magnitude, may take no more than a few minutes; others may take weeks or months.

    • Guidelines regarding employee involvement: This would cover how long and in what capacity employees participate in the decision-making process.

As you create your process, keep these suggestions in mind:

  • Decentralize decision-making so that the people with real-time information are the ones making the decisions.

  • Use technology to ensure that internal information flows openly.

  • Let go of decisions that are better made elsewhere. Doing so frees your desk of decisions that frontline employees are better qualified to make.