Sources of Power

“Conventional sources of power include deductive logical thinking, analysis of probabilities, and statistical methods — clearly defined procedures used primarily in laboratory settings. Yet the abilities that are needed in natural settings; those settings that include time pressure, high stakes, inadequate information, dynamic conditions, and team coordination, are usually not conventional at all. Natural decision-making is defined by poorly defined procedures, where one has to invent or modify procedures.”⁠[1]

Gary Klein highlights one of the main problems of research into decision-making — they’re too often undertaken in artificial environments (often amongst volunteers at US college campuses — hardly representative of humanity) rather than in the heat of battle, when it actually matters. This seems to account for the prominence of rational decision-making theories on which leadership training programs and HBR articles are written about. This privileges inductive and abductive thinking⁠ [2] based on statistical methods — the careful and deliberate review of alternative courses of action and the selection of the preferred course — but Klein found that people draw on a wider set of abilities, what he called ‘Sources of Power’:

  1. Intuition — using experience to recognise critical patterns (something we’ve seen before)
  2. Metaphor — understanding how past experiences may relate to new current states by exploring parallels⁠ [3]
  3. Storytelling — consolidating our thinking so it becomes available for checking by others
  4. Sense-Making — combining the fragmented information above in order to choose a viable course of action.

Crucially, Klein found that expert decision-makers (e.g. fire-chiefs dealing with a fire — not students on campus) seek ‘first-fit’ options not ‘best-fit’: they don’t seek optimal solutions but the first one that appears sufficiently right. They do this by running it over in their minds and discussing it quickly with those they trust around them. It’s more a process of imagining what will happen based on mental models (developed over time) rather a formal analysis. Klein concludes that decision-making in the wild — a volatile, uncertain and complex place — is about speed and correcting course as you go.

“…you have to somehow make high-quality, high-velocity decisions. Easy for start-ups and very challenging for large organisations … Speed matters in business … most decisions should probably be made with somewhere around 70% of the information you wish you had. If you wait for 90%, in most cases, you’re probably being slow. Plus, either way, you need to be good at quickly recognising and correcting bad decisions. If you’re good at course correcting, being wrong may be less costly than you think, whereas being slow is going to be expensive for sure.”⁠ [4]

This quote isn’t from an academic, or founder of a small start up, but from Jeff Bezos, founder of what has become a very large start up — Amazon, which the Barclays Equity Research. Business Insider, on March 29, 2017 argued will “likely be one of the first trillion-dollar market cap companies; it’s just a question of when, not if…”

Amazon’s dominance in each market it enters is partly down to it discovering the sweet spot between the market’s need, it’s own capabilities and an understanding of where technology is heading. But it’s also down to its decision-making prowess — being able to disagree about what to do but still commit to it, knowing that heightened situational awareness gives them the agility to make corrections as they go. Amazon’s other big advantage is that its rivals get stuck analysing the unknown, debating the unsure and committing to paths they can’t un-commit from later.

Refining decisions as you go through a continuous feedback loop — from Observing⁠ [5] what’s happening to refining how you Orient [⁠6], or make sense of the world — is partly what Boyd described as “implicit guidance and control”. Decision-making should not be separate from the rest of the organisation — the domain of leaders alone — but a way of testing ideas, discovering what works and which paths have monsters on them (so avoid!).

Making Decisions as part of a process of discovery can become a source of power in an organisation — rather than as the obstacle to action it is in so many places today where ‘decision-makers’ fear for their reputations or careers by making a mistake their organisation doesn’t have the awareness or agility to undo, learn from and go on regardless.

Boyd’s advice for ‘generating the tempo of operations we need to cope with uncertainty and disorder’ was that “command and control must be decentralised.

Executives don’t generally accept de-centralisation for the same reasons turkeys wouldn’t vote for Christmas given the chance — where would that leave them? (If, however, Executives don’t like de-centralisation because they don’t trust their employees to make good decisions then that’s a whole different set of problems — when everything is a service, everyone a customer and interactions take place on the frontline in real-time not having employees you feel you can trust means either they should be fired, or you should because it sounds like your company is going to go under pretty soon).

Wise Executives — who conduct realistic assessments of the prevailing situation — provide their people with a genuine sense of purpose (rather than one of these).[⁠7] This creates a direction against which each decision need only be checked against whether it advances the organisation towards this purpose or not. Decisions are hypotheses and action is the test of their viability.

Jeff Bezos has also noted the impossibility of knowing with any certainty whether decisions will advance the organisation or not, so developed the expression “disagree and commit” to make sure Amazon doesn’t get hamstrung by uncertainty:

“If you have conviction on a particular direction even though there’s no consensus, it’s helpful to say, “Look, I know we disagree on this but will you gamble with me on it? Disagree and commit?” By the time you’re at this point, no one can know the answer for sure, and you’ll probably get a quick yes. This isn’t one way. If you’re the boss, you should do this too. I disagree and commit all the time.”

Jealousy guarding the power to make Decisions is one of the most venal forms of micro-management — creating bottle-necks in the organisation and slowing down its ability to adapt. The business thinker Charles Handy argued against the conditions that lead to the impasse, advocating for ‘subsidiarity’ — leaving “as much power as possible as low as possible in the organisation because that’s where the knowledge and experience are”⁠. [8]

“Don’t push information up to authority, push authority down to information” — David Marquet (Nuclear Submarine Captain)

Pushing decision-making as close as possible to the professionals on the frontline — while communicating clearly your organisation’s purpose, investing in people’s decision-making skills, and cultivating the culture⁠ [9] — enables those closest to any opportunities or problems to solve them as they’re emerging⁠. [10] This ensures greater organisational responsiveness in the eyes of customers and gives key personnel the autonomy they often crave to deal with complex issues as they arise.

The alternative — tying people’s hands so customers are dissatisfied — is bad enough, but letting problems fester in today’s tightly-coupled systems, where problems can grow and spread like a virus throughout the organisation, can be the cause of disasters that maim and kill. Just look at Uber.

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Marcus Guest

Marcus Guest

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Making strategy simple — enabling organisations to make smarter moves. Get in touch at marcus@powermaps.net or learn more at PowerMaps.net