Decision-making is at the heart of any organized activity and, as such, there are significant associated risks and costs. The higher up you are on the totem pole the more risk, cost and impact is associated with every decision you make. For example, if you are the CTO and decide to switch from private hosting to the cloud, that has enormous ramifications. Obviously, such a switch is not a simple process. It will entail a thorough evaluation, prototype and gradual migration. This is often the reason that many large organizations seem to move at such a glacial pace. But, there are many decisions that can be made and acted upon quickly and yet often take a very long time.
This is often tied to the reporting and approval structure in the organization. The level of delegation and the freedom of underlings to make decisions on their own without approval is often the key factor.
There are many good reasons for managers to require approval: maintain control, ensure that good decisions are being made, stay up to date and informed on higher-level decisions. The flip side is that the more a manager is involved in the decision-making process, he or she has less time to interact and coordinate with other managers and her own superiors, study the competition, think of new directions and many other management activities. This is all understood and every manager eventually finds the right balance.
What many managers miss is the impact on their subordinates. Very often, a delay in decision-making is much more than making a quick bad decision. Let’s start from the ideal situation???your employees always make the right decision. In this case, any delay due to the need to ask for approval is a net loss. The more control a manager maintains and the more direct personnel he or she manages, the more loss will be accrued.
But what about the bad decisions that such processes prevent? This is obviously a win in terms of one less bad decision, but the downside is that in the long-run your subordinates will not feel accountable. They’ll expect you to be the ultimate filter.
If you’re aware of this then the path forward is pretty clear???delegate as much as you feel comfortable (or even more). Let your underlings make mistakes and help them improve over time. Benefit from streamlined productivity and focus on the really critical decisions.
Another important aspect is that not all bad decisions or mistakes are equal. Some mistakes are easily fixed. Decisions that may result in easily reversible mistakes are classic candidates for delegation. If the cost of a bad decision is low, just stay out of the loop.
