Like a Horse and Carriage

“We have to put leadership back in the hands of CEOs and their managers,” Pablo said. “Relying on control systems to manage our companies misleads us into the false sense that we actually have control.”

“You mean we don’t,” I stopped. “You mean we don’t have control?”

“Not over the things that really matter,” Pablo replied. “We don’t have control over our markets. We don’t have control over social trends, stock prices, pilot error. We only have the illusion of control. When we run our companies solely by its Key Performance Indicators, we remove discretionary judgement in the face of uncontrollable things. We have to put leadership back in the hands of CEOs and their managers.”

“By doing what?” I asked.

“By taking advantage of decision making and judgement at all managerial levels. The future is uncertain, ambiguous. Decisions made in the face of uncertainty and ambiguity are not calculated algorithms. If they were, we could let computers rule the world.

“We are back to two words,” Pablo continued, “accountability and authority.”

“Those are the two defined elements in structure,” I connected.

“Only when we vest decision making authority in the role of the CEO and the roles of managers, do we take advantage of their capability to do so. And only when we do that, can we truly hold them accountable for the results (output) of their teams.”

“I’m going to push back,” I countered. “I think most CEOs assume decision making authority at the highest level.”

“Some do,” Pablo agreed. “But, many run the company by the numbers, or offload accountability to their executive team, attempting to engage in democratic decision making. Then, wonder why the direction of the company goes off balance. We typically place accountability one level-of-work too low in the organization. Accountability and authority go together, you can’t have one without the other.

“Except in government,” Pablo smiled. “I always find it amusing, a government oversight committee, thinks it has all the authority without any accountability. If you have the authority, you have to have the accountability that goes with it.”

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