The cost of a decision

For the last year I have observed a decisional paralysis in multiple organizations.

In fact, it has been present for a lot longer, but for the last year I have started to understand why.

Humble thoughts on a hard reality.

Following numerous re-engineering, mergers, acquisitions, shut-down, re-organization and other similar situations, managers around the world have developed what I now call the “branch mind-set”.  You know what I mean, the branch manager who will only execute the head office directives, will only sell what the promotional leaflet advertises, will only stock what should sell out fast etc.

Whenever they are required to decide anything, most of them will not be able to comply adequately. They will invoke the need to “consult” with the management committee, their colleagues, the head office or …somebody !  Each time, reasons to inquire include the new structure, the recent goals of the new owner/shareholder, budget tightening, etc.

Therefore, in the last few years the decisional power of directors and managers of local branches is decreasing. With a few exceptions, most “deciders”  do not have the power to decide anything anymore. And once the decision is taken, the actual delay between the start and the end of the process is so long that the final result is frequently and adversely impacted.

This is the reason I conducted a few experiments with some of my clients to help them take decisions.

Test #1

I meet with some of my clients on a regular basis as part of on-going training activities. During one of these meetings, I asked them if they were convinced to be able to get a refund from their company if they were to purchase on impulse one or several of my books. The number of raised hands was astonishingly low. Reason : budget cuts. We are talking here about employees of international companies with revenues of hundreds of million dollars annually and a book worth 20$.

Upon seeing my surprise, I was then told that no spending was refunded if not authorized beforehand. Authorization for a 20$ decision ?

I then asked them if they had in the past clarified what was their decision power in term of money i.e. how much could they spend on their own without any formal authorization for the benefits of the company. In most cases, I was told zero.

Test #2

I could not believe this ! I asked again : was this the real amount or what they perceived as the reality, the sad reality. Had they, directly and very specifically, asked their boss how much they were allowed to spend with their boss’ authorization ?

AHA !

Nobody had dared to clarify this.

The test was quite simple : ASK !! Dare to ask !

Since I am fortunate to be with the same people every quarter, I could follow-up on this on the next meeting.

Test #3 : follow-up !

Suspense ! Boy, was I anxious to know the answer. Anxious and apprehensive at the same time. Not for the answer to :  » how much can I spend…? »

No, a simpler question : Did you ASK your boss what is the amount ?

I was expecting several « NO’s » .

I received only « NO’s »….

We then pushed the exercise to the next level.  « Why did you not ask this question ? »

Fear.

Fear to ask.

Fear to dare asking.

Fear that translate itself in to fear to decide.

Into inaction.

And in losses for the organization.

 

Conclusions next week.

In the mean time….

Do you feel this situation is related to YOU ?

Did YOU ask your boss what are the limits of your decision power ? Your spending power ?

If you did not ask, are your afraid to ?

Why ?

 

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