The Conversation of Decision Rights

Blog Post Transformational Leadership

The word -cide in “decide” originates from the Latin word caedere meaning, “to kill.” Other words that have the same root include homocide, suicide, genocide, pesticide. To decide then is to kill something off or to cut off – to kill off all other actions or options. However, it’s important that decisions do not leave people out and cause them to become alienated. In the process of making decisions, we do not want to “kill off” employee engagement. We want people to feel empowered; this is a balancing act that lies in conversation and not a rigid strategy.

Decision-making is important in groups. We know that it is more efficient for a group to push decisions as far out in the organizational structure as possible. This frees up leadership at the top from getting stuck in minutiae while giving others more autonomy, responsibility, and ownership, the sense that they have a say, and that what they do makes a difference. This is vital in order to achieve high employee engagement, a critical factor in large organizations. However, decision rights are not easily ceded and when they are, they are often viewed as being static and existing for posterity.

Michael Jensen, professor emeritus at Harvard Business School says “Allocating decision rights in ways that maximize organizational performance is an extraordinarily difficult and controversial management task.” One of the critical aspects Jensen highlights when considering decision rights is whether the information of the decision-maker is consistent with that of the organization. If this is not easily determined, then it is probably best for that decision to be taken back.

Having a workforce being empowered to make decisions is a complex and dynamic balancing act and decision rights need to be revisited periodically. If individuals have the power to always make decisions on their own and they have insufficient information from the top, then decisions will be made that are misaligned with leadership. If there exists too much concern about letting anything go, leadership will be seen as authoritarian. Employee empowerment and engagement lie somewhere between those two extremes and this lies in an ongoing conversation, rather than in something static.

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