How to make complex decisions in product and dev teams
Or why you should stop dot voting on product ideas.
How do teams make decisions? We’re all familiar with democratic and autocratic models. Imagine a boss constantly telling people what to do, or a team voting on the next big thing.
Because of autocracy’s deserved bad reputation and lack of inclusiveness, teams default to democratic decision-making. While clearly more inclusive, it doesn’t take into account either participants’ expertise or stakes. And by now, we have some strong evidence that what the majority thinks is good is not necessarily good.
The good news is there are 3 other decision-making models that can fit teams better.
The five decision-making models
Recap: autocracy and democracy
Autocracy — one person makes all the decisions. The only scenario where it might work well is when someone temporarily leads a highly incapable team. Temporarily, because otherwise, they should invest in making the team capable. The only upside: decisions can be made quickly.
Democracy, on the other hand, allows everyone to participate and is therefore seen as ultimately inclusive. Far from it: up to half of the people who voted for the losing option are completely ignored. The quality of the decision depends on the expertise and stakes of the participants and has better chances for complex decisions than autocracy.
Democracy fails when the majority overrules the experts. Imagine an entire organization voting on a financial decision or a cross-functional team voting on back-end architecture.
When it works: for the situations when everybody has equal stakes and expertise: when to have a stand-up or where to go for a team dinner.
Instead of letting the majority decide, why not make a decision that everyone likes? Starting with the nicest intention to please everyone, the search for consensus can turn into weeks or months of not making a decision.
As a result of many compromises, decision quality suffers.
Consensus is a default mode for cultures like in the Netherlands, so watch out for consensus paralysis if you’re in one of the Dutch companies.
When to use: when everybody has expertise in a matter and will experience the downside of a critical decision (e.g., hiring someone for a team)
Decision-making power is distributed proportionally to people’s knowledge and effort. Everybody else is consulted, and the decision is made by whoever experiences the downside most or has the most expertise.
While perceived as less inclusive than democracy, it comes with the best decision quality as, well, the most qualified person makes it.
When to use: meritocracy is the best default for cross-functional teams where different people have radically different expertise.
A software engineer decides on back-end architecture as having the most experience, or a product manager makes a product decision as being ultimately responsible for the outcome.
In Sociocracy, decisions are made by informed consent. A proposal is made and discussed. It is accepted not when everyone likes it but when everyone can tolerate it. Think about it as the difference between “I like it” and “no objections.”
While it’s still highly inclusive, the decision will happen faster than with consensus as the area of solutions that everybody doesn’t hate is bigger than the one “everybody likes.”
When to use: everybody has equal expertise and stakes in the decision, e.g., the design team approving a design system component proposal.
While there might not be one best approach that fits every situation, combining one or two of them makes a good system for complex decision-making in teams and companies.