The company’s raison d’être, essential for making decisions

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The company’s raison d’être, essential for making decisions

The company’s raison d’être, essential for making decisions

According to a study by OracleNetsuite, 82% of business leaders are stressed when making decisions. They are afraid of making the wrong decision and thus negatively impacting the company’s revenue (43%), damaging their personal reputation (23%) or even losing their job (13%).

 

Even in organizations that consider themselves high performers, risk aversion is taking its toll, with 62% of managers admitting to favoring the most conservative decisions even when they are aware that they may result in lower performance!

Deciding as a superhero?

The same study also tells us that 99% of managers are overwhelmed by the data at their disposal and, as a result, rely only moderately on it for decision-making.

 

But if they are crushed by data, isn’t it because, in conventional organizations, managers are still too often considered as superheroes who are supposed to know everything, control everything and decide everything? Inevitably, everything goes back to them.

 

This conception of the superhero manager is detrimental to the well-being of managers (permanent pressure, numerous personal sacrifices, constant tension, burn-out). It is also dangerous for the company. Isn’t it dangerous to put the fate of an entire organization in the hands of a single person at the top of the pyramid? Isn’t it risky to make the company’s success depend on the supposed outperformance of its leader alone?

 

Of course, this person can be charismatic, providential, or even a genius. He probably relies on methods, techniques and decision-making processes that are more or less proven. He also mobilizes his knowledge, his experience, his intuition (70% of managers rely on their intuition to make decisions, according to the above-mentioned survey). However, as the psychologist Olivier Houdé reminds us, “Intuition is often good. But in one case out of ten, it deceives us” (Le Figaro, December 2, 2021).

Deciding with Adaptive Governance

If “error is human”, it is still better for organizations and their employees that leaders make mistakes as little as possible.

 

Adaptive Governance (AG), without of course totally avoiding the wrong path, reduces the risk of making the wrong decision. Let’s remember that it is a form of agile organization that favors collective intelligence in the service of a company’s raison d’être. We have here two ingredients that favor decision making: collective intelligence and raison d’être.

 

First of all, collective intelligence. Based on roles, self-regulated and adapting to the needs and challenges of the moment, AG promotes subsidiarity and collective processes that allow for not only accelerated, but above all appropriate decision-making. And by delegating his decision-making prerogatives on the operational side to his self-organized team, the manager frees up time to make decisions that are more focused on high-stakes issues.

Operational decisions are made as close to the field as possible, with all the practical intelligence and responsiveness required.

Raison d’être: a compass for the company

But in order for everyone – leaders, managers, employees – to make the right decisions at their level of responsibility, they must all be moving in the same direction. Their compass is the raison d’être. It expresses, in a few words, how the company wants to have a positive and sustainable impact for each of its stakeholders. Determining the raison d’être – or purpose – of a team, regardless of its size, is like specifying the positive impact the team wants to have on the stakeholders of its ecosystem by fulfilling its mission.

 

Far from being a banal marketing tool, purpose is a decision-making tool. Managers, who never have all the resources to do everything, are constantly forced to arbitrate between one priority and another. The raison d’être is a reference point that facilitates decision-making. One can imagine a management team taking the time, before each strategy meeting, to recall the raison d’être and to ask itself how the company is progressing towards its implementation.

 

The raison d’être is also an organizational tool. Roles can be defined in order to achieve the purpose. By placing the raison d’être at the heart of the organizational design, cross-functional issues are necessarily taken into account. This avoids the pitfall of an organization in silos and focuses on creating value for stakeholders, starting with customers.

 

The raison d’être is also a recruitment tool. It facilitates the identification of people whose own raison d’être is aligned with that of the company and who, as a result, will be able to express themselves fully, to be part of the company’s project in the long term, to grow and to give it their energy and motivation.

 

Finally, the raison d’être is a tool for uniting around a common culture. First, in the design phase, since employees are invited to express themselves and to debate, a collaborative approach that engages them strongly. Secondly, in the life of the team, since each member of the team shares aspirations and values that give meaning to their actions and encourage their commitment to the group.

 

The raison d’être is a real management tool. Defining one for your organization means setting a clear course and giving meaning to your projects. It allows everyone to invest in the company, and therefore to produce value. It is to help employees, managers and leaders of the company to align their decisions so that they are consistent with each other.

Mickael Drouard picture

I am driven by one question: How to concretely bring collective intelligence and empowerment into daily practice in organisations? Over the last 15 years I have learned and developed highly efficient ways to do it.

Mickael Drouard

Partner

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