A Simple but Effective Guide to Making Decisions as a Leader
Solo Decisions, Consensus, or Delegation: Knowing When to Choose Each
In team management, I faced a leadership dilemma. Initially, I made decisions on my own. It was quick, but I made some mistakes and met resistance from the team. So, I shifted to a collaborative approach, with group decision-making, and noticed a surprising effect: decisions became the bottleneck of our work. This made me agree with Frederic Laloux in his book Reinventing Organizations:
In principle, consensus sounds appealing: giving equal voice to everyone (a value particularly cherished in Green Organizations). In practice, however, it often descends into a collective tyranny of the ego. Anyone can halt the group if their wants or desires are not included; it’s not just the boss who has power over others anymore, but everyone has power (even if it’s just the power to paralyze). Trying to accommodate everyone’s desires, even trivial ones, often becomes an excruciating quest; in the end, it’s common for most people to stop caring, begging for someone, please, to make a decision, whatever it may be.
But then, when should I make decisions alone, when should I seek consensus, and when should I delegate? I found the answer to this question in another book, Jurgen Appelo’s Management 3.0’. But first, let’s talk about the best moment for making decisions.
The last responsible moment for making decisions
A friend faced an ethical dilemma having to lay off consultants for several consecutive weeks to cut costs. She thought it would be wiser to lay off some coordinators, but her boss opposed the idea. Last year, her boss had advocated for hiring more coordinators in the annual planning to boost the company. This decision turned out to be counterproductive: the coordinators were more expensive and often idle due to a lack of team to manage. Meanwhile, laying off consultants burdened the remaining ones.
This highlights two key issues. First, the hesitancy to revisit incorrect decisions tends to worsen the problem. For this first issue, I recommend reading this other article. Second, companies commonly make anticipatory decisions during planning stages, like those at the end of the year.
Addressing this second challenge, Mary & Tom Poppendieck in her book Lean Software Development introduces a model that helps us reflect on the right time to make decisions. They recommends delaying commitment, avoiding making significant and irreversible decisions until the last possible moment. This moment is when the cost of not making a decision becomes greater than the cost of making one. At that point, we make the decision.
Now that we understand how to reflect on the ideal time to make decisions, let’s explore how different types of authority determine who is best positioned to decide on each matter.
The Seven Levels of Authority
In the book Management 3.0’, Jurgen Appelo discusses different types of decision-making when talking about ‘levels of authority’:
Level 1: Tell: You make decisions and announce them to your people. (This is actually not empowerment at all.)
Level 2: Sell: You make decisions, but you attempt to gain commitment from workers by “selling” your idea to them.
Level 3: Consult: You invite and weigh input from workers before coming to a decision. But you make it clear that it’s you who is making the decisions.
Level 4: Agree: You invite workers to join in a discussion and to reach consensus as a group. Your voice is equal to the others.
Level 5: Advise: You attempt to influence workers by telling them what your opinion is, but ultimately you leave it up to them to decide.
Level 6: Inquire: You let the team decide first, with the suggestion that it would be nice, though not strictly necessary, if they can convince you afterward.
Level 7: Delegate: You leave it entirely up to the team to deal with the matter while you go out and have a good time (or use that time to manage the system).
Jurgen continues by providing some examples:
I told our people that I would be starting a new business unit in our organization. (There was no reason for selling this to our employees because the one I had to sell it to was our CEO.)
I did sell the business model, and what type of customers we were after, to the people that I selected to join me in my effort.
For the name of our business unit I decided to consult all team members, asking them for their ideas.
When it was time to select a logo, I invited all team members to discuss the different designs and to agree together on the best one.
The technical design of our product was ultimately a team responsibility, although I did advise them concerning some architectural issues.
I didn’t really care who was doing what in the team, but I did inquire sometimes to confirm that they made the right choices.
Finally, I chose to delegate all the hard work. I was involved in coding for a while, but none of my code survived the team’s refactoring efforts, so I deduced that I was better at adding value in other areas.
Inspired by this, I created a summarized model that, I believe, further simplifies the decision-making process. This model aims to make it easier to understand when and how to apply each type of decision-making approach, rendering the choice more effective and less complex.
The Decision-Making Table
The ‘Decision-Making Table’ is a tool designed to guide decision-making in teams. This table is based on three essential criteria:
- The impact of the decision on the team
- Who has the most relevant information
- Who is responsible for the decision
For instance, if you have the necessary information and the impact on the team is low, the appropriate approach is to decide and communicate. However, if the impact is high, it’s important to not only decide but also to persuade the team about the decision. If you don’t have all the information but are still responsible for the decision, you should consult the team before deciding. Autonomy comes into play when the team has the information and responsibility, and your role is merely to advise before they make the decision. The following table summarizes these alternatives.
To simplify the ‘Decision-Making Table’ model, I have excluded levels 6 (inquire) and 7 (delegate), as level 5 (advise) already implies a form of delegation. The key difference is whether you advise before, after, or choose not to get involved at all.
It is crucial that the decision-maker is prepared to deal with the consequences of their decisions. This does not mean assigning blame for wrong decisions but acknowledging that every choice has implications, whether they are practical outcomes or learning opportunities.
The ‘Decision-Making Table’ does not guarantee perfect decisions; its purpose is to direct the decision to the most qualified people in each specific situation. This prevents managers with limited information from making impactful decisions without consulting the team.
A final note: Reflecting on decision-making, I realized that we often overestimate our ability to make correct decisions, even in matters that directly affect us. This perception changed when I began exploring the science behind decision-making, which reveals numerous biases that can lead us to make incorrect choices. To get an idea, look at the image showing the number of cataloged biases organized into larger groups.
Design: John Manoogian III categories and descriptions: Buster Benson. For an interactive version click here.
Knowing that we are constantly influenced by our cognitive biases, understanding the best moment for making decisions, and armed with the ‘Decision-Making Table’, I hope you are now better equipped to approach decision-making in your daily work.
