Business Core · Organisation · Module
Decision rights
Which recurring decisions exist, who makes each one, who must agree or give input, and what authority is delegated below the board.
The idea
How it works
A decision right is a standing allocation: this class of decision, whenever it arises, is made by this role. It is different from owning an initiative, which ends when the initiative does. Organisations tend to be clear about initiatives and vague about the recurring decisions — pricing exceptions, hiring above plan, changes to a shared system — that come up every week.
Where decisions should sit is partly a question of knowledge. Jensen and Meckling’s argument is that decisions are made well near the people who hold the specific knowledge they depend on, provided that the incentives and controls travel with them. The RAPID roles then separate the one who decides from those who recommend, must agree, give input or carry it out, so that being consulted is not mistaken for holding a veto.
Working with it
In practice
- 01
List the decisions before the roles
Start from the recurring decisions that cause delay or argument. A register built from the org chart describes positions, not decisions.
- 02
Give each decision one decider
Several people may recommend, agree or give input. Only one decides, and naming that person is most of the value.
- 03
Keep the agree role rare
Every agree is a veto. Reserve it for legal, financial or safety constraints; elsewhere, input is enough.
- 04
Align the schedule with the board
The delegated authority schedule should begin exactly where the board’s reserved matters end, with no gap and no overlap between them.
One level in
The components of decision rights
A component is something that exists afterwards which did not exist before — a deliverable or a mechanism, not an intention.
Decision register
The recurring decisions, each with its decider and the roles that recommend, agree and give input.
LearnDelegated authority schedule
The limits within which each role may commit money, people and contracts without referral upward.
Learn
If a decision has two deciders, it has none. Count the Ds in the register before anything else.
The other modules in organisation
Structure
How work is divided into units and joined up again: the basis for grouping, the spans and layers of management, and what coordinates across units.
LearnLeadership
What leadership is expected to do in this organisation, how that work changes from one layer to the next, and how leaders are judged against it.
LearnAdoption
The human side of change: who is affected and how much, how far each group has actually taken the change up, what resistance is saying, and what holds it in place.
Learn