Decisions we make

(…and those we don’t)

About ten years ago, I was working from Argentina for a client in Chile. It may seem hard to imagine now, but I was still working with a PC, WhatsApp wasn’t popular yet, and international calls were pretty expensive in my country. After a few days of making at least one call to Chile a day, I created a ticket requesting a headset so that I could replace phone calls with Skype calls. To my surprise, the ticket was rejected by Nick from the service desk department without much explanation. The purchase wasn’t allowed. I re-opened the ticket a few times, explaining that one call to Chile was more expensive than the cheapest of headsets without luck. I finally explained the situation to Chris, one of the senior managers, and he approved an exceptional purchase. Several weeks have gone by with at least an international call a day. You do the math.

The case

I’ll do the math for this article’s sake. For me, there are three things that we should do if we want to have the numbers in order:

• The obvious math: Nick from the service desk department rejected the ticket because he had no budget to buy headsets. Paul, in charge of the telephony services department, had a budget for phone calls and, as far as I’m aware, my international calls to Chile didn’t ring a bell to him (no pun intended). And there was even a company policy supporting that.
• The apparent-whole-picture math: this is the math that I was doing at the time and that I presented to Chris. It would have been better for the company if we did one expense and purchased the headset to save money on phone calls for the rest of the project. The company would have been saving the amount of one headset per day for the whole duration of the project.
• The complementary-yet-less-obvious math: creating a ticket takes time, rejecting it manually takes time, the cycles of re-opening the ticket and rejecting it take time, and a meeting with Chris takes time. That multiplied by the hourly rate of all the people involved gives you an interesting number.

I had many of these situations in my professional life. As probably had you. In my case, I have always been labeled as a rebel because there was no good answer to each of my claims. Besides, I always felt like I had a blind spot (or several): there must be something I wasn’t seeing. The collection of answers I got through the years includes “This is Nick’s responsibility”, “We don’t have the budget for that,” “the policy explicitly forbids x, y, z,” “There was a case where someone abused the system and bought headsets for his whole family,” and, my personal favorite, “We’ve always done things this way here.”

The solution to decision-making economics isn’t simple because the problem is complex. That’s why, in an attempt to solve it, we recur to the simple math, to what we know, and to what we are measured for. But the good news is that every time we make a decision, we can make things better. We only have to become aware of all the times we decide things, even when they’re automatized in a policy.

And why does it matter? There is a common phrase, “People don’t quit jobs, they quit their boss.” That may be true if they have a crappy boss, but, in my opinion, people quit because of decision-makers making poor decisions. People quit because they end up dealing with a system that simply does not work: a system that lays obstacle after obstacle in front of you, making it harder to do your job.

Having a magic calculator to build my case every time would be amazing. But creating such a device would lead to the kind of over-analysis, bureaucracy, and control that got us in this mess to begin with. Most organizations we are part of are optimized for specialization, and many people might even say that, as a consequence, efficiency is at its best. What actually happens is the organizational morphology and dynamics create silos and rigid behaviors that do not allow the organization to evolve and grow as required. We produce more inefficiencies instead of gains. We forget that we can learn and create different realities instead of becoming cogs in the organizational machinery.

The most important decision a leader makes is how to structure their organization. The structure builds up morphology and dynamics, which significantly impact the way decisions are made. Most of those do not foster good decision-making because they do not foster collaboration and the magic of collective intelligence appearing. But reshaping a company structure all at once is extremely difficult and painful. Does that mean we are hopeless? No. As my frequently quoted yoga instructor, Lula, says: “Structure generates habits, and habits generate structures.” So, let’s talk about habits!

Considering everything is urgent

One that I see a lot is that we treat all matters as urgent, as life or death decisions. And with that sense of urgency, the whole process deteriorates. I admire people that can make good decisions in emergencies or crises. But it’s impossible for any human being to resist a lifetime of urgencies, living under the tyranny of the urgent, as referenced by Charles Hummel.

When assessing decision-making, refer to Lean principle #4, “defer commitment,” usually represented by the question, “Is this the last responsible moment to make this decision?”. It helps you focus on what matters today and make better decisions when you don’t have all the necessary information.

Deciding something for the people, without the people

And what about gathering information? You’ve received a new [insert your example here] request, and your immediate reaction is to answer no due to [insert your favorite excuse here]. My invitation here is to ask yourself a more visceral (or, should I say, Argentinian style) question: “Who am I fu***** with my refusal?” Identifying the people impacted by your decisions, as incomplete as the list may be, and having a meaningful conversation with them will definitely improve your decisions and the working mood.

Not delegating enough

Delegation is underrated. I can assure you that if you ask yourself, “Am I the best person to make this decision?” more often than not, the answer is no. Or it is, “No, but [insert your favorite excuse here].” For example, why on Earth, as a manager, would you make decisions on your team’s vacation time? What information do you have in hand that they do not?

On the contrary, people actually doing the job are the best to decide when taking a leave of absence doesn’t affect the work being done by the team. The same goes for making decisions on buying stuff they need to do their job. Why don’t you make them accountable for their own P&L instead of making it a centralized decision? Clearing up your calendar from tasks where you don’t add value creates space for those where you do. This needs to become an everlasting purpose.

Overreacting to mistakes

Fear and disappointment usually activate our inertia to control things. Because of that, this habit is a tough one. It happens with the type of gravity that we feel we need to do something extra to overcome it. That something extra can feel as expensive as a space walk or as fleeting as dancing. But isn’t it too expensive to create a process and a policy just because someone made a mistake once? How expensive is that mistake or abuse of the system compared to the cost and hassle of having a formal policy and control? Is it worth it to become an impossible company just to avoid it from happening again?

Sometimes making a benefit out of something expensive for the employee but insignificant to the company’s P&L far outweighs the unhappiness at the workplace and disengagement of dealing with bureaucracy. Math is required here, and not the simple kind. It’s worth the effort.

Repeating decisions over and over

Whenever “A” happens, you always decide “B.” Should that decision be automated? Yes, please! All the way! Let’s say someone has a baby. Every time you get the news, you buy the same gift. That news surely ends up impacting one of your systems, which should trigger the purchase and the delivery, reducing waste along the way. Now that you have that automated, you get complaints about people wanting a paycheck instead of a gift. You review the decision, maybe even make a catalog of options, and change the process. And so on. When you have decisions automated, any formal or informal raise of exemptions should at least trigger a warning.

Not challenging organizational boundaries

Long-existing boundaries and labels are a pain in the ass for our creativity on how to make decisions. For many people, it’s hard to get past the organizational morphology even when they realize doing that would actually change something. So why don’t you make temporary changes to the morphology without making that much noise so that no one complains? What am I proposing here? In traditional hierarchical, functional-based organizations, to make at least an apparent-whole-picture decision, you need to get people from different areas of the organization together and get them talking. I usually recommend this for organizations going through a transformation and call them scaffolding structures. And this habit may, in turn, become a structural change. Being a manager of something doesn’t always make you the right person to decide on morphology. Foster trust and rely on collective intelligence instead.

Procrastination: A bittersweet pleasure of many

The reason for procrastinating is different for each of us and in every situation. But I can assure you that if you procrastinate on something past its last responsible moment, the cost and impact may be unmeasurable.

I feel like this is the goodbye letter I’ve always wanted to write. And though it seems like writing this from the 2000s, these habits are still heavily present in today’s organizations even though progressive organizations are creating systems to enable distributed decision-making, build trust to foster freedom, and radical transparency, among others.

Decisions we make, and especially those we don’t, have an impact beyond our span of control (if only we had Lion-O’s Sword of Omens). They say something about us, what we value, and what we prioritize. And we must remember that many people won’t put up with the organization long enough to understand the rationale behind them, the benefits, or the allegedly bigger picture. But the void is filled with imagination if we don’t say anything. Learning fast, being brave enough to accept mistakes, and trusting the people we hire for the job with the resources and decision span necessary to get the work done, are key, in my opinion, to start steering the wheel in the right direction.