The more things lean towards central control, the less space you have for local manoeuvre. Responses can’t be tailored to individual circumstances. Innovation suffers. If in doubt, we refer decisions back to the centre, creating delays.
A well-drafted policy can be incredibly valuable, but large volumes of policy confuse more than they enlighten.
Another common side effect is proliferation of governance bodies. We have the IT Council, the Investment Review Board, several Working Groups, various Committees, etc. Everyone wants to be involved in each decision.
More delay. More confusion. More infighting.
More governance doesn’t mean better governance.
Governance isn’t about checks and controls. It’s about making good decisions. In a well-governed organization:
- We understand which decisions are important. We don’t waste time attending to the unimportant stuff. We certainly don’t invest a lot of effort writing policies and setting up bodies to deal with trivia.
We’re clear about who needs to be involved with each decision. There might be a single decision maker. It might be a consensus decision for the entire team.
We may have to consult other stakeholders. Whoever it is, we know who they are. We don’t waste time arguing about demarcation.
- We understand the decision process. We know what information needs to be considered, what analysis is needed, what tools to use. We’ve had any necessary training. We’ve established communication protocols and suchlike.
- We gather feedback. We track the outcome of decisions, so we can adjust course as necessary. We monitor the decision making process, refining and streamlining it wherever possible.
Some checks and controls will result from this process, but the primary intent is to increase focus, reduce waste and capture learning. If you do that, then you’ll almost automatically have enough visibility to exercise appropriate control.
If I want to implement this sort of governance, governance that enables action rather than getting in the way of it, then here are some of the principles I’d keep in mind:
Enable people to exercise judgement
Good judgement adds far more value than rule-following. Yes, automate the simple decisions, but thereafter focus on bringing the right people into the loop and giving them the tools and information they need.
Keep policy clear and simple.
Complicated bodies of policy get in the way. They take too long to understand; create too much scope for conflicting rules. You can’t foresee every future circumstance, so don’t write policy that attempts to do so.
Write simple policies that set clear boundaries and define overall principles, then let people interpret the nuances that apply to their specific situation.
Articulate organisational objectives
People need to understand the wider context if they are to interpret the nuances of policy effectively.
Ensure that the organisation’s wider objectives and strategic intent are stated clearly, so that people can make decisions that carry you towards these wider goals.
Favour devolved control
People who are close to the situation tend to understand local capabilities and customer needs far better than central policy-makers.
Centralisation creates consistency and lets you optimise use of specialist resources, so it has a role, but that loss of local situational awareness is a major drawback.
Regular cadence; small batches
When decision-making bodies meet infrequently (these days, that means at monthly or longer intervals), they create delays: work queues up waiting for their decisions.
Likewise, each meeting must address a large batch of decisions, meaning that people pay little attention to each decision and have no scope to learn from one decision to the next.
Where I need a defined governance body, I prefer to have it meet frequently and at regular times (e.g. every Friday morning at 9am), for short meetings that attend to a small batch of decisions.
Learn from feedback
People will make mistakes. They’ll overlook key information and stakeholders. They’ll become overwhelmed by circumstances. In the face of uncertain and incomplete data, they’ll make incorrect assumptions.
Likewise, you won’t get everything right the first time: you’ll overcomplicate some policies, overlook some stakeholders, leave gaps in key areas.
Your governance structures therefore need to gather feedback at two levels: about the outcome of each decision, and about the effectiveness of the overall decision-making processes. Then ensure you act on this feedback in order to improve things.
Get out of the way
Sensible organisations go out of their way to hire good people – bright, dedicated, enthusiastic. Why tie them up with rules and policies? Yes, set clear boundaries. Then let your people get on with it.