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© 2024 N. Dean Meyer and Associates Inc.
Excerpt from www.NDMA.COM, © 2024 N. Dean Meyer and Associates Inc.

Book: How Organizations Should Work

Executive Summary
The Golden Rule (Empowerment): Authorities = Accountabilities

overview of this fundamental tenet of organizational design

by N. Dean Meyer

[excerpt from the book, How Organizations Should Work]

What does the oft-used word "empowerment" really mean?

Book: How Organizations Should Work

It is certainly not a free-for-all where anybody can do whatever they please. Organizations cannot operate that way.

Empowerment comes down to simply this:

Authority and accountability match.

Empowerment is the most fundamental principle of organizational design -- absolutely essential to the success of every organization. It's so important that I call it the "Golden Rule" of organizational design.

For organizations to prosper, everyone must have sufficient authorities to accomplish there accountabilities. Conversely, organizations that violate this rule cannot perform well.

Derivation of this Principle

Let's derive this principle from basic facts....

In an organization of one (if there is such a thing), the one and only person has complete authority over everything that the organization does. And that same person is completely accountable for the results of the organization.

Admittedly, there are limits to this person's authorities. Externalities like government (laws and regulations), force majeure (natural disasters), and constraints imposed by capital providers (e.g., shareholders, bankers) can reduce that one person's authorities without taking on any accountability for the success of the organization.

That's true. But as the saying goes, it is what it is. If you can't change it, don't worry about it.

"As we look ahead into the next century,
leaders will be those who empower others."
Bill Gates

Let's talk about things that are within our control.

What's within our control is what that one person does with their authorities and accountabilities as the organization grows.

As soon as another person is hired, that leader could violate the Golden Rule and assign that subordinate accountabilities without matching authorities.

In such a situation, the boss can make decisions that harm the employee's project. Without an investigation, including a chance for the employee to defend their performance, it's hard to know whether blame for the failure lies with the subordinate or the boss. Thus, one ethically cannot hold the employee fully accountable for the results.

The same is true in larger organizations when one manager asks something of another manager. For example, if a business unit asks an internal supplier such as IT for a solution, it has to ensure that IT has the needed authorities to get the job done.

Among those authorities is control of resources -- funding, whether that takes the form of a priority on the IT department's budget or actual cash. If the business unit doesn't acquire the needed priority or provide the cash, it cannot hold IT accountable for delivery of the solution.

Authorities also include the right to make decisions about how to achieve one's accountabilities. Whether it's your boss or a peer asking something of you, you're only empowered if you are held accountable for the "what" and are free to determine the "how."

It can be even worse when the Golden Rule is violated in the design of the organization's structure. When one group has the power to tell another group how to do their job, it must share accountability for the other group's performance.

And when learning (innovation) is separated from doing, one group has the power to determine another group's future. It must accept partial accountability for that other group's success.

People cannot be held accountable for results if they don't have the authorities necessary to achieve those results. Sure, you could try to hold staff accountable for things they can't control; but this won't lead to good performance. All it does is establish a scapegoat to blame when things go wrong.

It's a fixed-sum game. It all started in the one-person organization where authorities are aligned with accountabilities (mostly, except for externalities). The key is the way they're both divided up among subordinates.

Why Empowerment is Essential

If ever authorities and accountabilities are separated, serious problems inevitably arise:

  • On one hand, those with accountabilities, but insufficient authorities, are disempowered and can't get their jobs done.

    They may fail to deliver on time, on budget, or at all. And they become scapegoats for decisions made by others.

    Over time, disempowered people adopt a helpless "victim" mentality, take no initiatives, and spend a lot of time reading Dilbert and laughing about how futile it is to try to accomplish anything important.

  • On the other hand, those with authorities, but not matching accountabilities, become an unconstrained tyrants for lack of checks and balances.

    This wording may seem a bit strong. But in fact such people can make decisions without bearing the consequences; they can tell others what to do, while others are held accountable for results.

    So there's little to stop such a person from issuing edicts that may or may not be practical, and then letting others take the blame when these commands backfire. Without checks and balances, people with more authorities than accountabilities do as they please.

An example: Operations runs whatever Engineering builds....

Let's say you're in charge of IT Operations. Your job is delivering infrastructure-based services reliably and efficiently.

But what if you have little say over what goes into your infrastructure. IT engineers decide that for you. How would you feel?

Disempowered, to be sure. You probably realize that you're set up to fail. Look at the incentives built into the organization.

Engineers love innovation and are rewarded for their technology designs, but they aren't held accountable for cost-effective, stable operations. In pursuit of the "right" technologies, you'll be given the latest and greatest.

And when those engineers decide to try out some bleeding-edge technology, you'll take the fall when it proves unreliable.

This structure is like allowing Boeing to decide what airplanes Delta Airlines will use. How can we hold Operations accountable for the cost or performance of their services when they have no say over what their infrastructure looks like!?

The answer is, we can't.

When IT engineers have the authority to design the infrastructure without the concurrence of those who will own and operate it, the Operations group becomes a passive dumping ground. It cannot be held accountable for the cost or quality of its services.

Authority must match accountability, in every part of the organization, all the time.

Consequences go beyond poor performance, the unfair treatment of staff, and the risk of untethered decisions. Precious minds are wasted when they cannot accomplish their accountabilities in the best way they know how. Career paths for the disempowered are constrained. And internal tensions undermine teamwork.

Furthermore, empowerment is essential to employee motivation and retention. Nobody likes to work for a micro-managing boss, or for micro-managing customers.

Beyond just individual effectiveness, empowerment is essential to organizational performance.

Given all the myriad pressures on organizations, one thing is clear: Executives who "take control" and personally make all key decisions become bottlenecks. They stifle everybody else's initiative and creativity, and constrain their entire organizations' performance.

"Most of us who have created a business... don't pretend that we're smart enough to make every decision by ourselves."
Michael Bloomberg, Founder & CEO, Bloomberg L.P.

To deal with the complexity and pace of today's business environment, there's only one answer: Organizations have to tap the talents of every bright mind to the fullest. That means empowerment.

Empowering everybody, at every level, is the key to organizational performance.

Do People Want Empowerment?

It may be that some staff don't want to be empowered. They just want to be told what to do. Maybe they don't want the stress, or the risks.

They fall into three categories: (1) Those who don't want to be held accountable for anything. (2) Those who resist accountability because they aren't qualified to do their jobs. (3) Those who are just nervous, perhaps doubting their own abilities.

Those in the first category have ng a place in a high-performing organization. They'll either leave company voluntarily when they see they'll be held accountable, or involuntarily if they repeatedly give excuses or blame others rather than taking responsibility for their work.

"...by failing to tap the strengths
of every individual in our company,
we were heading toward a dead end by dumbing people down."
Jack Stack and Bo Burlingham, authors, The Great Game of Business

Those in the second category should be moved to a job they can succeed at.

But for those in the third category, for those who try, the organization should help them grow into their empowered jobs.

How Empowerment Works: Manage By Results

Authorities come in three flavors: decision rights, resources, and access to information.

In a high-performing organization, everybody is accountable for their own results, and is empowered with authority over all the information, resources, and decision powers they need to do their jobs.

This is partly a matter of structure. Jobs are defined as businesses within the business, so that people are empowered to run their businesses.

And no group is chartered to tell another group how to do its job.

(This is one of seven engineering principles underlying the design of a high-performing organizational structure. All seven principles can be found here.)

"Never tell people how to do things.

Tell them what to do, and they will
surprise you with their ingenuity."
George S. Patton, Jr.

Beyond that, it's in how you ask things of others. The key is to ask for specific deliverables -- the What. Then, you can manage people by their results.

Don't tell them how to do their jobs, and don't manage tasks (what people do, as distinct from what they produce). As soon as you do, you're partially accountable for results. And they're less accountable."

The people doing the work are the best qualified to know how to get their jobs done, once they understand what outputs are expected of them. (If they're not, then train or fire them!)

Presuming your staff are competent, let them be creative. Assign them clearly defined results (which may include compliance with policies, standards, regulations, and the required documentation). Equip them with all the authorities, resources, information, tools and methods, training, and advisors that they need to do the job. Coach and teach them.

Then give staff the freedom to deliver their work products in the best way they know.

There's one more key mechanism of empowerment: Once you've agreed on the deliverables, the person asking for something is responsible for providing the resources, information, and decision rights needed to deliver those results.

By putting the onus on the requestor to supply needed authorities, you don't coerce staff to accept accountabilities without needed authorities, and then blame them if they aren't able to get those authorities on their own.

More detailed guidelines on how to implement empowerment....

When you ask things of others, you must:

  • Clearly define the deliverable (the end result).

    • Base the magnitude and complexity of the deliverable on the degree of confidence people have earned.

    • Define the results broadly to include not only the intended outcomes but also side effects. Results could include reporting project status, or producing certain artifacts like documentation.

    • Do not specify tasks, processes, or effort, or tell people how, when, or where they work. But do define any constraints that limit how the work is to be done.

  • Provide resources either by supplying a budget, or by convincing someone who controls a budget to allocate resources.

  • Provide authorities either by granting rights which are within your power (like a boss delegating authorities), or by convincing those who have the power to grant them any needed rights.

  • Share information about the context ("big picture"), where this deliverable fits, and anything else that could help them get the job done.

Work Assignments

Empowerment does not constrain a supervisor's ability to make work assignments. In fact, assignments are more clearly defined. And supervisors don't inadvertently force subordinates to accept impossible assignments.

But if an employee doesn't agree to a perfectly reasonable assignment, that's treated as a performance issue.

Could a boss could empower someone in order to pass blame downward, setting up a subordinate to take the rap in an impossible situation?

No. Bosses retains accountability for their requests and their decisions to empower people.

Whos' Accountable for Staff's Skills?

The requestor must supply resources, information, and decision rights. What about skills? Is a manager responsible for their staff's training?

In an empowered organization, everybody is accountable for their own career success, and hence for developing their own skills.

But while leaders can't force people to learn and grow, it is their responsibility to ensure that the resources (time, money, training, and growth assignments) are available so that staff have the opportunity to develop themselves.

When the Boss Does Know Best (Coaching)

Empowerment includes agreeing on the What, but not dictating the How. But what if the boss knows better than the employee how to do something?

Coaching is entirely compatible with empowerment.

Coaching isn't dictating tasks or overriding decisions, which would mean that you share in the accountabilities. When you coach, you can help staff think things through; and you can share what you've learned. Meanwhile, you must make it absolutely clear that your advice is not a command.

As to a new person who's still learning to do their job, or who doesn't have the maturity to take on responsibility for an entire project, how can you empower them?

"Trust is not a gift from others,
it is compensation for work done."
Russell L. Ackoff

The answer is simple: In smaller chunks. Just break projects into a series of small deliverables. This will have them reporting back more frequently, while still keeping them fully accountable for results.

Then, as they build a track record, you can increase the size of the chunks.

Work From Home (Or Whenever/Wherever You Want)

Managing by the What, not the How, may give people the freedom to work from home any time they want. Within the law, labor contracts, and policies ensuring equitable HR practices, empowered people should be able to choose when and where they work.

If getting the job done requires being in the office or working certain hours (to work alongside others or cover a shift), then that's what staff will choose to do because they're accountable for results.

There's no need to worry that work-at-home staff will goof off and not be as productive just because they're not being watched.

In practice, working from home is often more productive than coming into the office. But if staff are unproductive, you're going to know it, regardless of where they physically sit. You won't see the results you agreed to.

Perhaps more importantly, that whole notion of managers watching over people to be sure that they're putting in required hours and efforts is completely out of step with an empowered culture. Again, manage people by results, not effort.

But is work-from-home worth the risks? It is, for many reasons.

"People who love going to work are
more productive and more creative....
They treat their colleagues and clients and customers better.
Inspired employees make for stronger companies
and stronger economies."
Simon Sinek

People are more productive. Collaboration across offices is better, which helps maintain a shared-services approach (no decentralization) even as you expand geographically.

It allows access to high-quality people that you might not otherwise have been able to recruit, like stay-at-home parents and people with mobility issues. And it's helps attract talent from all over the country, even internationally -- and that can include great people in distressed countries who really need the work.

In that same vein, learning to manage by results makes you better at using "gig workers" -- contractors here and off-shore.

And there's an interesting side benefit.... When Covid-19 hit, those who were good at empowerment were better prepared than most to work remotely, and more resilient in the face of the pandemic.

Work on Whatever You Want?

There are some tech companies that have famously allowed their staff to sign up for any projects that interest them. Is that part of empowerment?

No. In that kind of operating model, how could you ever be sure you have resources aligned with strategies? How could you ensure that projects have all the needed specialists, or even that all the needed specialists exist within the organization? Perhaps if you have huge margins, you can get away with that. But it's not efficient, agile, or safe.

In an empowered organization, individual accountabilities are clear; they're aligned with enterprise priorities; and people know they serve customers. So, you empower staff to deliver what their customers choose to buy from them in the best way they know how. It's no different from the empowerment of any business owner.

Furthermore, letting people sign up for whatever they want isn't necessary to attract and motivate talent. What people want is respect, an energized and high-performing culture, control over their destiny, and the knowledge that they're making a difference in the world.

They can have all that by being empowered to run a business within a business, even if what they produce is determined by (internal) customers' needs, not their personal preferences.

What About Controls?

Obviously, anarchy isn't an option. Work has to be coordinated.

Furthermore, controls are necessary, not because people are stupid or evil, but because organizations must ensure that their scarce resources are used for just the right things, and that staff's activities are aligned with organizational goals.

In the past, leaders played a critical role in coordinating and controlling people's work. This is precisely what put leaders in the position of bottleneck.

In empowered organizations, coordination and control are not a matter of micro-managing bosses, nor are they left to high-level goals with occasional performance reviews. Rather, they're inherent in what people must do to succeed.

Analogy: Business owners don't need to be told to please their customers, and to manage their staff and suppliers effectively. They do that because that's what it takes to succeed in business.

Similarly, in healthy organizations, personal success is aligned with the success of the organization.

Remember, empowerment is not a blank check whereby people can do whatever they please. People remain accountable for results, even though they have the freedom to decide how they'll produce those results. They're measured (at least in part) by their success at delivering those results.

Leaders assign deliverables (results) to staff, and ensure that all those deliverables add up to the organization's objectives.

Then, they can stop micro-managing, that is, directing tasks and intervening in day-to-day decisions. They won't need to. Instead, leaders can focus on where the organization needs to go (strategies) and on ensuring that staff can succeed in a supportive organizational ecosystem.

Of course, all this rests on your ability to hold people accountable. Performance management is really important, not just to get results, but also because there's nothing quite as demotivating as seeing others around you perform poorly and get all the same rewards.

The key to empowerment is, performance metrics focus strictly on results. Manage people by the bottom line, not the top line.

Role of Hierarchy in an Empowered Organization

Does empowerment obviate the need for a management hierarchy?

Again, the answer is no. A hierarchical organization chart is a great way to ensure that every needed specialty exists somewhere in the organization, and that there are no redundancies (internal competition).

And the reporting structure has value, too. There are lots of things that bosses do without micromanaging or disempowering their staff.

It's just that hierarchy is not a good way to get work done.

Leadership in an Empowered Organization

With managers out of the command-and-control business, what's left for them to do?

Consider, what would you do if you had more time? In an empowered organization, leaders (at all levels) look after the following:

  • Purpose: Illuminate the value of people's jobs; create a sense of shared purpose.

  • Vision: Synthesize the big picture; envision the future.

  • Ecosystem: Nurture the organizational ecosystem; structure subordinate domains; optimize processes; remove hurdles.

  • Talent: Recruit, coach and mentor, and engage people; negotiate objectives; provide fast feedback; manage performance.

  • Inspiration: Set a high bar; stretch people's thinking; ask questions that drive innovation; put forward challenges that drive performance; question mental models that get in the way; expect the best (without demanding the unreasonable).

  • Motivation: Make people feel appreciated; instill self-esteem, confidence, and a desire to win; set a positive, friendly tone; build esprit de corps; engender a sense of fun, excitement, and adventure.

  • Resources: Negotiate budgets; propose and defend investments in the group; manage commitments; assign work.

  • Coordination: Coordinate shared decisions within the group (e.g., common methods, tools, standards of practice); make decisions when consensus cannot be reached.

  • Strategies: Inspire, coordinate, and guide business and product strategies for the group (recognizing that subordinate leaders are empowered to determine their own sub-strategies).

  • Risk: Approve decisions involving risks above given thresholds (e.g., budget signing authorities, reputational risks, security risks).

  • Connective tissue: Communicate up, down, and sideways; engender a sense of being part of the larger whole.

  • Representation: Represent the group in leadership discussions (involving staff in leadership meetings whenever they're needed).

  • Sales: Represent the group in walk-throughs (Chapter 8); promote the group to peers; assess customer satisfaction.

  • Model behaviors: Exhibit in one's own behaviors the culture, habits of personal effectiveness, and spirit (attitudes). 38 More

All of these are higher-value uses of leaders' time.

By the way, don't expect the managers who report to you to have all the answers. They should be encouraged to bring their staff forward, and let the people in the best position to know answer your questions. When they do, you'll get the facts; you'll get to know more of the staff; and you'll see that subordinate leaders are empowering and cultivating their people.

Bottom Line

Empowerment doesn't mean eliminating the organization chart or undermining the chain of command.

It means getting leaders out of the job of telling people how to do their jobs, and into the challenges of designing organizations, developing strategies, and aligning indivudals' accountabilities for results with enterprise goals.

"After implementing this vision, I'm in awe of how the organization
is doing so many great things without my intervention."
Sergio Paiz, CEO, PDC

Without micro-management, leaders and staff alike can deliver results that otherwise would have considered extraordinary. And really, leaders working at this more strategic level have more control, not less, because their time and efforts are so highly leveraged.

The Golden Rule of empowerment should guide the design of every aspect an organization's operating model -- its structure, culture, resource-management processes, and metrics.


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