3 Challenges for improving strategic decision making in 2024
This will be the last Uncertainty Project newsletter of 2023 - since starting the project a year ago, it’s felt like decision making (as an explicit practice) took a leap forward in 2023.
Just this month, we heard how Jeff Bezos wants Blue Origin to be ‘the world’s most decisive company’ and got a glimpse into how great product organizations like Slack and Hubspot systematically make decisions.
What does it mean to be a decisive company? It starts with recognizing decision making as an organizational capability that can be improved.
It’s improved by making our implicit decision making practices explicit so they can be challenged, re-designed, and measured - because ‘good’ decisions are the result of effective practices, not their outcomes (outcome bias or ‘resulting’).
“What makes a decision great is not that it has a great outcome. A great decision is the result of a good process, and that process must include an attempt to accurately represent our own state of knowledge. That state of knowledge, in turn, is some variation of ‘I’m not sure’.” - Annie Duke, Thinking in Bets
As we look back over the last year, we can organize these learnings into three primary challenges to transition theory into practice going into the next year.
- Challenge 1: Approaching decision making as an explicit practice
- Challenge 2: Clarifying decision rights
- Challenge 3: Revisit the underlying foundation driving every day decision making
These challenges cover a broad range of tools and topics we’ve covered in the Uncertainty Project this year and most importantly, they have the ability to produce meaningful results relative to the energy and political capital needed to make these changes.
Challenge 1: Approaching decision making as an explicit practice
For many organizations, asking “How does your company make decisions?” is typically met with blank stares. More often than not, we gripe about how difficult decision making feels in our day to day activities, but don’t have much of an idea how to fix it - we even struggle to effectively describe what the problem is.
We’ve seen countless memos from leadership and teams alike citing ‘decision making’ as an inhibitor to speed - “We need to be more decisive!”.
As with any problem, it’s critical to effectively frame it - which starts with understanding how our organization makes decisions today.
Decisions have a lifecycle. Where do they originate? How are they framed? How are people and information included in a decision? How are decisions communicated? How do we know if a decision is ‘good’?
At the Uncertainty Project, we use the term ‘Decision Architecture’ to define the set of practices and principles organizations use to evaluate, make, and communicate decisions - every organization already has a decision making process, it’s just typically formed implicitly and haphazardly over time.
The capacity for effective decision making is an emergent capability - and often exhibits similar challenges to ‘improving culture’ when it comes to behavior change.
We could easily replace ‘culture’ with ‘decision making’ in this quote and the message remains the same:
Culture (Decision making) is like an iceberg. Some aspects, like behaviors, rituals and artifacts, are easy to see. Others, like values and norms, are trickier to spot. Being cognizant of all these characteristics—both above and below the surface—is essential in shaping a culture (a decision making practice) that aids, rather than obstructs, the organizational results you seek. - Edward T Hall
This challenge for 2024 is to deeply understand how our organizations make decisions, and be thoughtful in improving the design of that experience (much like creating an environment for a positive culture to emerge) - if we do not explicitly design this experience, it will be designed for us.
- Create an experience map of the current decision making process
- Identify pain points with the existing experience
- Publish an initial version of your ‘Decision Architecture’ - a document/narrative describing how your team or organization makes decisions today
- In general, be more thoughtful about deciding how to decide
“A wise leader, therefore, does not see herself as someone who simply makes sound decisions; because she realizes she can never, on her own, be an optimal decision maker, she views herself as a decision architect in charge of designing her organization's decision-making processes.” - Olivier Sibony
Challenge 2: Clarifying decision rights
If there’s one consistent pain point we see, it’s murky decision authority.
This tends to be the first step in taking a systematic approach to decision making and many organizations have some form of practice in place to identify who is responsible for moving a decision forward or ultimately making a decision.
During my time spent in product management at Atlassian, we used the DACI framework extensively across the company (this year, the DACI playbook was the second most visited page in Atlassian’s team playbook).
For those that have tried one or more of these frameworks, you may already know some of the challenges that arise - just to name a few:
- Decisions surface as a document with biased framing - the decision has already been made and the documentation is clearly for theater
- They lack a truly responsible decision maker (or the ‘decision maker’ is just an approver)
- They tend to leave out dissenters or others who are downstream impacted
That’s not to say there isn’t any value in these frameworks as a starting place - they are relatively easy to adopt (e.g. one team can start using any of the templates out there), but if we take a step back and look at the broader domains of decision authority, we can clarify decision rights prior to the decision point and try to avoid these traps.
"Good fences make good neighbors" - Robert Frost
This year, we talked quite a bit about the importance of creating clear decision rights around strategic context (e.g. business units, products, solutions, etc…) and how our ability to align decision authority can have a positive impact on the invisible forcefield of power dynamics.
When these are not addressed systematically prior to the decision point, then power dynamics set the rules.
Mapping the organizational fences that dictate decision making can have a profound effect on decision velocity, clarity, and confidence - a great place to start is the ‘setting boundaries’ playbook.
- If you haven’t tried a DACI or RAPID, it’s worth try it out! It’s a step in the right decision and at the very least, it begins to build a habit of decision documentation
- Move beyond a responsibility matrix (like the frameworks above) and think about defining organizational ‘fences’ of decision ownership - get started with the ‘setting boundaries’ playbook
- Think about delegation and escalation - when a new decision arises without clear decision rights, how is it escalated? Who will be responsible for a similar decision in the future? Where can authority be further decentralized?
Challenge 3: Revisit the underlying foundation driving every day decision making
Many years ago, I read Donella Meadow’s essay on ‘Leverage Points: How to Intervene in a System’ - in particular, she ranks paradigm shifts and transcending paradigms as the most impactful levers of change.
She explains the paradox that paradigms are the most difficult and impactful levers, yet arguably the least expensive and quickest to change.
"You could say paradigms are harder to change than anything else about a system, and therefore this item should be lowest on the list, not second-to-highest. But there’s nothing physical or expensive or even slow in the process of paradigm change. In a single individual it can happen in a millisecond. All it takes is a click in the mind, a falling of scales from eyes, a new way of seeing. Whole societies are another matter — they resist challenges to their paradigm harder than they resist anything else." - Donella Meadows, Leverage Points: Places to Intervene in a System
This year we learned quite a bit about paradigms - and the impact these implicit beliefs and assumptions have on our strategic decision making:
- How 'collective illusions' influence decision making
- The role of conviction and narrative in decision making
These all address the topic of deeply seated organizational models that drive strategic decisions - and why they’re so difficult to challenge. When we stray outside of these collective beliefs we meet an insurmountable obstacle.
This isn’t to say all (or any) beliefs and assumptions need to be challenged, but they often remain implicit. Making them visible can encourage much-needed conversations around why they are driving the strategy - and if they’re sacred beyond challenge, at least the constraints are known (for better or worse).
- Document existing beliefs - not for the purpose of challenging them (yet), just to revisit them and understand how they came to be.
- If you’re feeling spicy, run a belief challenging exercise - see how much these beliefs align with the views of leaders in the organization today and have a healthy conversation around any contradictory viewpoints. As Meadows points out, sometimes all it takes is one conversation to shift a paradigm.
- For beliefs and assumptions that remain strong, think about setting tripwires by asking, what would have to be true to change our mind about this?
That’s a wrap on 2023!
A huge thanks to all the readers - especially those who have been with us from the very start!
Next year we hope to have more collaborative talks and events to connect more people across this community - we’ve already met so many interesting individuals who I’ve personally learned so much from. And for that, I thank you!
See you next year! 🎉