Decisions are the coin of the realm in business. Every success, every mishap, every opportunity seized or missed stems from a decision someone made—or failed to make. Yet in many firms, decisions routinely stall inside the organization—hurting the entire company’s performance.

The culprit? Ambiguity over who’s accountable for which decisions. In one auto manufacturer that was missing milestones for rolling out new models, marketers and product developers each thought they were responsible for deciding new models’ standard features and colors. Result? Conflict over who had final say, endless revisiting of decisions—and missed deadlines that led to lost sales.

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How to clarify decision accountability? Assign clear roles for the decisions that most affect your firm’s performance—such as which markets to enter, where to allocate capital, and how to drive product innovation. Think “RAPID”: Who should recommend a course of action on a key decision? Who must agree to a recommendation before it can move forward? Who will perform the actions needed to implement the decision? Whose input is needed to determine the proposal’s feasibility? Who decides—brings the decision to closure and commits the organization to implement it?

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When you clarify decision roles, you make the right choices—swiftly and effectively.

The Idea in Practice

The RAPID Decision Model

For every strategic decision, assign the following roles and responsibilities:

Decision-Role Pitfalls

In assigning decision roles:

• Ensure that only one person “has the D.” If two or more people think they’re in charge of a particular decision, a tug-of-war results.

• Watch for a proliferation of “A’s.” Too many people with veto power can paralyze recommenders. If many people must agree, you probably haven’t pushed decisions down far enough in your organization.

• Avoid assigning too many “I’s.” When many people give input, at least some of them aren’t making meaningful contributions.

The RAPID Model in Action

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Example:

At British department-store chain John Lewis, company buyers wanted to increase sales and reduce complexity by offering fewer salt and pepper mill models. The company launched the streamlined product set without involving the sales staff. And sales fell. Upon visiting the stores, buyers saw that salespeople (not understanding the strategy behind the recommendation) had halved shelf space to match the reduction in product range, rather than maintaining the same space but stocking more of the products.

To fix the problem, the company “gave buyers the D” on how much space product categories would have. Sales staff “had the A”: If space allocations didn’t make sense to them, they could force additional negotiations. They also “had the P,” implementing product layouts in stores.

Once decision roles were clarified, sales of salt and pepper mills exceeded original levels.

Source: https://t-tees.com
Category: WHO