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Decision governance can play a critical role in creating, maintaining, and adapting social hierarchies. The design of decision governance systems influences both the stability and adaptability of hierarchies.
Social hierarchies often arise naturally as a means of organizing around complex issues and goals by facilitating the flow of information, clarifying roles and responsibilities, and delineating decision authority. How do they influence decision processes?
Understanding explicit hierarchies and detecting implicit ones is important in decision governance because hierarchy influences possible assignments of decision rights and responsibilities.
The org chart shows much more than who reports to who. It is one of few core tools for learning about the existing decision governance setup, as well as for planning and implementing changes to how decisions are made. If you look across the org chart vertically, across reporting lines, here is what you can…
The corporate function or group will usually have in its scope to decide how decision governance works in a firm. Key design decisions they will make involve who can design how decisions are made, how they can do so, including how to handle changes to, exceptions, and incidents related to how decisions are made. When…
In a firm, what is the relationship between transparency of information and specialization of work? Increasing specialization means that individuals over time deepen a relatively narrow set of skills and knowledge required for these, in response to the opportunities and problems they are responsible for. There are organizational structures that evidently encourage specialization, such as…
In a functional organizational structure, each team is responsible for a set of something called functions. An essential property of a functional team is homogeneity of knowledge within the team: people in it usually share similar educational background, similar expertise, similar career development paths. A clear benefit of functional organization is that it allows a…
If a product/service should generate positive network effects, how do you make the value comparable for the 1st and the 1 billionth user? Accomplishing this means that you can offer more value to the early adopters, and if so, then the network of users should grow faster, or equivalently, adoption should be faster. “In economics,…
The crypto glossary at Andreessen Horowitz [1] gives the following definition of a Decentralized Autonomous Organization, or DAO: “Decentralized autonomous organizations” or DAOs represent exactly what they are called; they are: (i) decentralized so, the rules cannot be changed by a single individual or centralized party; (ii) autonomous, so they operate based on logic written…
What determines the distribution of knowledge and information flow between teams in a firm? Why are some bigger than others? Why do some teams collaborate more with others? Many small choices made by different people, inside and outside a team, accumulate to hard-to-reverse distribution of expertise, decision authority, and resources, that is, into the set…