Archive for the ‘decision-making power’ Category

Your company needs to long-range forecast? Don’t depend on a single person!

January 18, 2008

Companies try to forecast the future. For example, a printer company tries to forecast the future demand of printers. Based on their forecasts, they make planning decisions. Thus, decisions are made in the face of uncertainty.

The more power you give to a single individual in the face of complexity and uncertainty, the more likely it is that bad decisions will get made.

Conversely, decisions made by aggregating the collective wisdom of a diverse group of people will outperform even the smartest person most of the time.

— Paraphrasing The Wisdom of Crowds by James Suroweicki

Aligning worker and corporate interests

December 24, 2007

Here are two approaches to solve the problem of aligning worker interests with the corporate interests:

  1. Home owners are, in general, more likely to take good care of their property than renters are. Similarly, workers who have an ownership in a company are more likely to be interested and productive than if they simply “work there.” Give workers stock options.
  2. When someone else makes all the decisions (about how to solve a problem, which alternative to take, etc.) then workers have no incentive to be creative and are not motivated. Give workers real decision-making power.

— Extracted from The Wisdom of Crowds by James Suroweicki