Five Org Design Things N° 6

The 95th percentile isn’t that impressive; how DRIs worked at Apple; Effective leaders decide about deciding; Rooting out bias in decisions; AI and interest rates

Real-world tasks don't get enough practice

This is a great, lengthy read on the nature and state of skills. Dan argues that the 95th percentile isn't that impressive, and connects that back to the lack of practice that most folks put toward their goals.

This definitely resonates with what I've seen and experienced, and connects back to my earlier article on the state of teaming. 99% is out there, and we just need to practice to get there.

Which leads me to...

How the original iPhone team worked at Apple

I’ve tweeted about this before, but when we made the original iPhone, we didn’t have product managers. We had directly responsible individuals (DRIs). Each important piece of work had a single person charged with seeing to it that the work got done. 1/
— Ken Kocienda (@kocienda) August 28, 2022

There's some nice description of how the original iPhone team worked at Apple, including how the functional teams worked. Seems to me that the functions weren't the primary "identifiers" of the structure – instead, Ken describes responsibility for some aspect of the finished product.

And that the DRIs were expected to work outside of formal hierarchies in order to do their thing the right way. This is pretty much the opposite of the way things feel inside large, matrixed organizations.

In another company, I might have needed to buck that VP meeting up the management chain. At Apple, I was the DRI, so I was expected to reach out directly. (That project didn’t ship… a story for another time). 8/
— Ken Kocienda (@kocienda) August 28, 2022

Which leads me to...

Effective leaders decide about deciding

This is from god-tier presentation designer Nancy Duarte. It's a pretty straightforward request for managers to describe to others what kinds of decisions they want their teams to make on their own, what kinds of decisions need to be escalated, etc.

(I wrote about decision-making protocols and teams quite a bit this week, and here's an older thing on RACI vs. DICE.)

This is definitely a good practice and something that all leaders should do – and I'm sorry to say that this is definitely rare.

I've seen two main barriers to this in practice:

People are uncomfortable calling out the boundaries of their authority; their own lack of authority bums them out. It sucks to realize that you actually have to get a lot of approvals and support from others in order to make a call that you feel like you could make on your own. Fight through this discomfort! It's better to get reality on paper than to force your team to wade through a bunch of tacit barriers. This can also be a forcing function for a team to get good at reaching out, building consensus, and developing practical ways to work through the matrix.
Teams don't believe leaders when they "give away" their decision-making authority. Real example: we documented the decision rights that a CMO wanted to vest in their team, including the formula for the new product, the packaging design, and the ATL marketing program. The CMO wanted the team to just go make their own decisions on these things without his input. The team didn't believe this, even weeks after the decisions had been passed down to them. We continually had to bring them to the CMO's office to have him repeat to them, "I want you to make this call yourself. Don't involve me."

In the Ken Kocienda example above, leaders would mostly be deciding who the 99% DRIs need to be.

Which connects to this...

How to root out bias in decision-making

This article is a little fluffy, but it does have a good checklist for improving the quality of decisions:

Should someone else who has time to assemble a complete picture make this decision?
Do I really have a broad enough perspective to make and defend this decision?
What values or beliefs may be coloring my thinking?
What would happen if I decided to move forward in the opposite direction of what I originally chose?

Asking yourself these questions would probably push you toward making decisions as a group of interested/invested parties, toward devolving authority to teams that are closer to the customer, and toward decisions that are expressed as a tradeoff between two equally good options. That's great! You should do that!

Relatedly...

AI and interest rates

This is a cool article? document? that explains how the market isn't currently pricing in the development of advanced artificial intelligence.

That's all well and good and seems like the market might be wrong in this case – but these examples of the market being really really good at learning and predicting are good "high water marks" for group decision-making.

In the wake of the Challenger explosion, despite no definitive public information being released, the market seems to have identified which firm was responsible.

Economist Armen Alchian observed that the stock price of lithium producers spiked 461% following the public announcement of the first hydrogen bomb tests in 1954, while the prices of producers of other radioactive metals were flat. He circulated a paper within RAND, where he was working, identifying lithium as the material used in the tests, before the paper was suppressed by leadership who were apparently aware that indeed lithium was used. The market was prescient even though zero public information was released about lithium’s usage.

Organizations aren't set up to make decisions like this, and it shows – how many brains go into each decision your firm makes? How could that number be higher without adding more work?