Building a culture of effective decision-making

As technologies like Generative AI gain momentum and reshape industries, companies are under pressure to move into new spaces, enhance their offerings and accelerate operational improvements. Leaders increasingly find themselves with a myriad of choices to make and are expected to demonstrate new value quickly. In the face of rapid change, the culture around decision-making is key for them to adapt and thrive.

In many ways, making decisions is the lifeblood of any organisation: Slow decision-making leads to missed opportunities. Making too many decisions too fast, without enough regard for the implications, proves unsustainable. The era of “move fast and break things” – Mark Zuckerberg’s famous motto – is over.

By contrast, Jeff Bezos — love him or hate him — shared his vision on Lex Friedman's podcast to make the space exploration business Blue Origin, "the most decisive company," saying:

"We're going to get really good at taking appropriate technology risk and making those decisions quickly, being bold on those things and having the right culture that supports that…If there are five ways to do something, we'll study them, but let's go through them very quickly and make a decision.” 

Whilst not every company has to embrace Blue Origin’s bold approach, it is important to note the connection between effective decision-making and culture – and the impact this has on business success.

For any organisation going through rapid change and any form of transformation, the biggest challenge is the softer stuff, namely how employees operate, collaborate, and are incentivised to perform. It is impossible to radically evolve a core product, platform, or service without transforming — or at least consciously, and continually evolving — the organisation from within. Decision-making is pervasive in an organisation, but it is rarely considered a topic or capability in itself. 

At Beyond, we know from experience that decisions are everything in product or service delivery: what bets to place and risks to accept; what opportunities to pursue; what to build, what not to build; how to build it, in what order. The list goes on. 

When we work with companies to improve or launch new products and services, we use a toolbox of techniques to understand the level of risk associated with certain strategies or features, or to increase confidence in perceived sources of value. But for those tools to have real impact, and lead to the best possible outcomes, we encourage stakeholders to reevaluate the ownership of decisions and help their organisation become more decisive. 

Challenges with decision-making in products and services

We have noticed three main decision-making challenges in our experience working on ambitious product and service development initiatives in large traditional organisations:

1. Rigid funding cycles: Budgets for new products are allocated on a fixed annual basis and are cost/return-oriented, with a focus on planning as much as possible ahead of time. Progress is often measured by how well the team sticks to the plan. Senior leaders can get caught off guard by the issues that arise during delivery and the decisions the team needs to make to tackle these. This is because they tend to act as gatekeepers but are not part of the agile delivery process.

2. False autonomy: A product team is formally granted a reasonable level of autonomy, but decisions made by the wrong individuals or groups consistently override theirs. Product decisions (big or small) are therefore made with a limited understanding of audience needs, effort required, or dependencies. The product leaders may fear to challenge senior executive opinions and demands.‍

3. Siloed decisions and poor governance: In many large traditional organisations, teams have historically operated in silos, but as the organisation matures to focus on the end-to-end customer experience, leaders and their teams have to reorganise around the various phases of the customer journey and collaborate laterally. This requires a high level of orchestration to prevent duplication and operationalise decision-making. 

Digitally native organisations may not have to deal with legacy systems and rigid governance, but they encounter almost opposite challenges around decision-making, especially as they scale:

• Too much autonomy: Many digitally native organisations can suffer from too much self-organisation. With too many small autonomous squads, strategies and decisions about the product can diverge and disperse. As a company scales, there is a need for more focus and a higher level of centralisation. As a result, companies like Spotify now grant a high level of autonomy at VP level (several hundred people) and less at lower levels.

• Decision paralysis: Product owners and product managers are reluctant to make bold or risky decisions that could prove to be costly. The team may feel paralysed in the face of too much data and have an insufficient understanding of meaningful insights to feel that they can make a strong decision. Even though the team may seem to be aligned, there can be underlying confusion about the appropriate course of action and collective decision paralysis.

• One-size-fits-all decision-making process: There may be a single, standardised process or decision-making framework that is applied uniformly across the board, regardless of the significance or impact of decisions. This can significantly slow down progress and create unnecessary complications. Scaled Agile Framework (SAFe) is a fine example of a corporatised attempt to adopt a form of agility by forcing over-rigid, layered, and redundant decision-making processes, contradicting its very purpose.

Bringing practical and pragmatic decision-making to organisations 

Building a decisive culture is similar to strengthening a muscle: it develops through regular, purposeful practice. Overdoing it and attempting to change too much too quickly can be costly.

At Beyond, we embrace the following behaviours to help organisations make better decisions. Though they have to be integrated gradually by, and progressively built into the mechanics of, product and service delivery, they enable organisations to reap the benefits of becoming more decisive. 

• Co-create a strategic North Star and align all ideas to it. If you can only do one thing to improve decision-making within your team, it should be this: define, map and illustrate your vision for the experience provided by your product/service. This provides a direction of travel that everybody should understand and support. It should also act as a focal point to define the strategies (the 'how') to get there. This creates alignment across stakeholders and the ability to prioritise ideas and strategies that support that vision — and de-prioritise those that don't. 

• Balance high and low levels of risk. Thinking about decisions in terms of strategic bets is useful: Some might be high risk but may yield exponential benefits. Other low-hanging fruit may be safer, but lacks sufficient impact to distance competitors. When considering a backlog of items or a roadmap, we find a healthy balance of smaller and bigger bets is necessary to make impactful improvements.

• Accelerate small bets, and slow down big ones. Amazon’s concept of “two-way door decisions” versus “one-way door decisions” is helpful in understanding this: Most decisions are two-way door decisions — if wrong, they can be reversed, and you can come back and pick another door. These decisions should be taken by people in small teams, deep in the organisation. One-way door decisions are much harder to reverse and are more costly and/or time-consuming. These require as much analysis as possible. They should be deliberately brought to senior team executives to slow them down and scrutinise them very carefully.

• Gather enough information.The key is to make bets with open eyes based on a detailed, clear, and thoughtful case that presents enough information to drive discussion and a decision. This information should include known risks and implications and an understanding of what it would take to reverse the decision. It is helpful to make it visual: show what it would feel like in the hands of customers, and bring to life what it would enable them to do. Don’t over-polish it so people feel like there is still room for debate.

• Be data-driven, but pay attention to intuition. Relying on data alone can lead to the wrong decision. There is abundant research that shows the connection between the brain and the gut. Listening to your gut feeling does not mean acting on emotions; it is listening to your intuition and experience, something that your brain may not be able to articulate yet. When prioritising features in a backlog, adopt a data-driven approach, but leave room for individuals to express their instinctive point of view and interrogate the short versus long-term implications. 

• Practise good conversation: debate and align. An organisation’s culture needs to allow employees to confidently express disagreement. To be able to say “I fundamentally disagree with you” without fear is a really positive signal of healthy conversations. Tension within decision-making isn't a negative — quite the opposite. Having a strong opinion, but also having the willingness to learn and change those opinions is critical to healthy debate and alignment. 

• Better integrate agile practices to support transparency and control. As more effective decision-making behaviours become embedded within an organisation, it becomes easier to introduce processes that allow delivery teams to escalate and seek senior-level guidance at speed. Bring senior leaders into the process in small increments to act on issues at the earliest stage possible. Building existing effective behaviours into those processes will help to establish the right level of autonomy to suit the needs and scale of the organisation.‍

Estelle Ricoux is Director of Product and Strategy at Beyond. She has spearheaded significant projects in B2B, healthcare, and retail, and now leads the strategy for our Beyond Transformation practice. If you would like to learn more about how Beyond can enhance your strategy and accelerate growth, please get in touch.