Management decisions

The traditional approach to management is that it is there to make decisions and to control the output of the work force.  Information flows up the hierarchical tree and the results of the decision making process flow back down to the people who carry out the tasks. At the same time it is usual for some form of target or performance management metric associated with the decision to ensure that everything is kept on track.

This leads to three things:

  • The information flowing up to management does not necessarily reflect the full picture of what is happening.  People will provide information upwards which supports any particular case that they wish to make.
  • Decisions are made on a partial understanding of the business issues at hand and when this is the case are often no better than guesses.
  • The focus of employees is turned towards whatever target or metric is required.  The very fact that management has decided to measure it has indicated that it is important and so everything must be done to achieve it.

Management by its very nature is removed from much of the day to day activity of an organisation.  The larger the enterprise then the more distant and remote the management team becomes.

We need to turn this traditional approach on its head.  Management’s role is not to make decisions but to create a working environment in which good decisions are made. These need to be made as close to the production of the product, or as close to the customer as is possible.  Any step away from this dilutes their potency and effectiveness.

Management’s role is not to control the employees but rather to create an environment which encourages people to take a more active role in their work and enables teams to solve issues and create value without fear of having stepped over the line.

Management needs information, not to make decisions but to improve the overall understanding of what is happening within the business.  The information is telling a story but that story needs to be fully understood before it is of value.  Management, with the full involvement of the workforce needs to keep digging and digging into the information until the root cause of any issue is understood.

Once a problem is understood it is much easier to identify the correct course of action, one that is based on firm foundations and will deliver sustainable results.

At the same time, management needs to be very careful about any hint at a target or a metric.  The very mention of a number can be sufficient to turn it into the centre of attention if this is the way that the organisation is used to working.  The numbers in themselves are not important.  Their part in the story and its understanding are.

This approach means that:

  • The gathering of information is used as a tool to understand the business better.  Management ensures that understanding is shared and flows throughout the organisation.
  • Decisions are no longer based upon management hierarchy but are made upon a fuller understanding of issues with a greater buy in from all stakeholders.
  • Numbers are used as points of interest and not ends in themselves avoiding distracting activities to achieve abstract targets.

The new approach to management should be that it is there to improve decision making through improved understanding and to enable the work force to deliver better outcomes.

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