EFFECTIVE “CORPORATE” DECISION MAKING: STEP ONE THE PURPOSE AND REQUIREMENTS OF MEETINGS

To be a manager is to make countless individual decisions for which you will personally be held responsible and accountable. However, in most organizations managers collectively are also required to occasionally come together at various levels to decide and implement decisions that will impact their entire organization simultaneously. It is these latter collective decisions that I refers to as “CORPORATE”.

In this series of six articles I lay out a step by step process for corporate decision making that my experience has demonstrated both helps groups arrive at and implement sounder decisions, and provides the sort of management accountability for their decisions any organization has the right to expect from those in charge.  I suggest reading these articles in order because each step builds on what comes before.

STEP ONE:  THE PURPOSE AND REQUIREMENTS OF MEETINGS

When a group of managers collect under whatever name they call themselves — a corporate board, executive committee, leadership team, etc. — to make a corporate set of decisions, I believe it is important that all members understand from the start the exact purpose and requirements of these meetings themselves.  While the same managers may collect for other purposes in the course of routine business, the demands of effective corporate decision making gatherings are unique and require discipline in their adherence.  Specifically, effective corporate decision making requires three important initial agreements among all participants.

First, group members agree that they will only address corporate-level matters.  If those responsible for corporate level governance will allow it, subordinate management can often not resist bucking their own difficult decisions further up the line.  Moreover, many senior managers often can not resist involving themselves in matters below their current level of responsibility.  The old axiom that management decisions should almost always be made at the appropriate level applies here and those responsible for corporate-level decision making must enforce it.

Second, group member’s agree that they will leave their parochial interests outside the room.  This is a tough and demanding requirement for many managers, especially in organizations where political infighting and horse trading are management’s cultural norm.  In these environments decision making gatherings are highly political, with participants seeking to bargain, compromise, and establish quid-pro-quos in pursuit of the best possible outcomes for their specific constituency. Managers feel pressure from their constituents to protect their interests even at the cost of overall corporate needs.

Corporate decisions by their nature generally create winners and losers at subordinate levels.  Individual corporate decision makers must, therefore, be prepared to accept those losses that impact their constituents and the anger they will likely face from them following the decision’s announcement.

The best managers generally try to use the announcement of unpopular corporate decisions as “teaching moments” for their constituents, emphasizing the importance of accepting the fact that the overall good sometimes outweighs one’s individual desires.

Third, group members agree to maintain the distinction between a DISCUSSION and a DECISION meeting.  This may seem a small matter but it is not.  Most of us who have managed can recall departing a meeting wondering what actually happened during its duration.  Was anything decided?  Was anything important conveyed?   What was the point of the meeting at all?

Effective corporate decision making meetings have three core elements: (1) the subject matter requiring a decision; (2) the knowledge necessary for decision makers to render an intelligent decision; and (3) the decision itself.

Element one — the subject matter — constitutes an agenda item and is ideally the sole focus of the meeting in most instances.  Cluttering the agenda with unrelated matters diffuses attention.

Element two — knowledge acquisition — constitutes the purpose of a DISCUSSION MEETING, or a series of discussion meetings depending on the complexity of the subject.  I like to call these discussion gatherings “get smart meetings”.  They generally involve advance readings, presentations of facts and data by various experts, and extensive discussions among group members.

Because these meetings are often intellectually taxing and sometimes lengthy and exhausting, it takes time for participants to absorb what they have learned and reason through all the facts and data, with an eye toward what decision or decisions  they will support.  Forcing a decision at the end of a tiring discussion meeting is generally a bad idea.

Element three — the decision — is better reserved for a specific DECISION MEETING, during which all participants understand that the meeting’s only purpose is to decide something regarding the subject at hand.  Furthermore, I recommend it be understood that the meeting room door is figuratively locked until the group reaches its decision.  This is to prevent procrastination or what author’s  Jeffrey Pfeffer and Robert Sutton call the “Knowing Doing Gap” that bedevils so many organizations.

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