Organisation design covers two key things:
- How decisions are made and who makes them
- Who does what, the skills they have and who is accountable for the outcome
If you get it right, organisation design should support rapid and robust decision making that sticks, efficient delivery of work, happy employees and a desirable culture. Most of what you need to run a successful business.
Families are no different. They are much less likely to have formal decision rights, governance structures and org charts. But an implicit organisation design still exists, reflected in relationship dynamics and the daily discussions that characterise family life. Moreover, you can learn from the unspoken organisation design of a family and how we can learn from that to approach organisation design of a business.
What is the best organisation design for your family?
1. The strains of accountability
In business, people talk a lot about accountability – the person who is in trouble if the outcome is not delivered and responsibility – the person who does the work. The allocation of accountability and responsibility is at the root of much family and business strife.
There are two key factors, capacity and control. Starting with capacity, everyone gets the limits of responsibility. There are any so many hours in the day to do stuff. If someone is responsible for more stuff than they have time to do, then stuff won’t get done. This is not a hard one to resolve, align household tasks with available capacity i.e. you do the washing and I will empty the dishwasher.
The problem is always capacity for accountability. Accountability entails a heavy mental burden. It’s not enough to do the steps, you must own the outcome and the dependencies that come with it.
Accountable people have the stress of delivering the outcome and are often dependent upon others to make it happen. For example, a great piece of accountability in the family which is unspoken; a parent's responsibility for their children’s teeth. Owning the outcome of healthy teeth – making sure dental appointments are booked etc. – is a lot more stressful than the responsibility of taking a child to the dentist.
The problem is that many families fail to fairly distribute accountability or even acknowledge that it exists and imposes a mental burden. This can lead to one parent being accountable for all the key outcomes, keeping children fed, vaccinated, appropriately dressed etc.
The answer is simple, define the key accountabilities, distribute them fairly and make sure that the accountable person can manage the associated dependencies.
2. Big D decision maker
Many corporations have spent years perfecting governance models that support slow, escalated and controlled consensus decision making to mitigate risk and control cost. Unfortunately, being slow at making decisions is a big problem in a rapidly evolving business environment. It also undermines attempts to drive employee innovation – requiring ten people to sign-off a new hire doesn’t help drive entrepreneurial behaviour.
This has led to a focus on re-wiring corporate decision making to focus less on control and consensus and more on ownership and empowerment. Specifically:
- One Big D decision maker (taken from the RAPID framework) for all the important decisions the organisation makes. Others can influence, but they can’t block. The Big D decision maker owns the decision and its consequences
- Pushing decisions down into the organisation to avoid everything being escalated (slowing things down and clogging-up senior management), and empowering people close to the outcome / front line to act on what they see
Two simple changes that have a massive impact upon the speed of change, pace of innovation and responsiveness of the business. The same applies in families.
In the family consensus has an important role to play - a point that will not be lost on anyone who has had to persuade a three year old that it really, really is bath time and there will be no negotiation. A company board (or political cabinet) need to take collective ownership of the big decisions. Families are the same. Having one family member decide unilaterally to emigrate to the other side of the world is probably not going to be conducive to family harmony.
However, when it comes to day-to-day operational and management decision making clear decision rights and empowerment are extremely powerful. Deciding what food to buy for the week ahead or when to do the next load of washing is best given to a single person. They don’t need to go into collective governance to achieve a consensus. If they do it takes at least three times longer to decide and is a massively irritating – choosing where to go on a group holiday is the extreme example of this.
Our recommendation is that you cut out all collective decision making for non-strategic family decisions and enjoy the reduction in decision making stress and an improvement in decision quality – when it is just a single person’s choice to make you will find that the decisions are generally better.
Organisation design is fundamental to the working of any business or family. Invest time in getting it right and you will reap the benefits.