How a Decision Room Can Enable Change and Innovation
One of the challenges leaders face in times of uncertainty and rapid change is helping senior managers to engage in bigger-picture thinking. To enable this process, a growing number of companies are creating “decision rooms” – dedicated areas that help them visualize challenges and opportunities from a number of perspectives and make better decisions.
David Sibbett, in his new book, Visual Leaders: New Tools for Visioning, Management and Organizational Change, explains why a growing number of organizations are dedicating meeting space to creating visual environments called “decision rooms” that are designed to better support bigger-picture thinking and innovation.
“Much of leadership is focused on guiding people to do things that will produce superior results for the organization,” he explains. “This is a process of maintaining the big picture… and then making astute choices of what to do next. Many times these choices will be yours alone, depending upon what kind of unit you are leading, but often in regard to very critical, organization-shaping choices, you will need to bring others along.”
By visualizing this information on a large scale, senior management teams and leaders can reach consensus and implement faster.
Solving large, complex problems, discerning a clear direction and getting top managers aligned to support major change initiatives can be very time-consuming for leaders. Decision rooms provide a large-scale canvas where senior management teams can do “What if?” thinking, visualize and explore a range of opportunities and make better-informed decisions about the firm’s future direction. By visualizing this information on a large scale, senior management teams and leaders can reach consensus and implement faster.
Isn’t a typical executive conference room with a few flip charts or whiteboards adequate for these types of high-level discussions? No, says Sibbett. What’s needed is a dedicated space that has these characteristics:
- Abundant space for visualization: Walls where giant rolls of butcher block paper can be attached and multiple people can provide written or hand-drawn input,
- Excellent technical infrastructure, for displaying forms of electronic data such as presentations, drawings from tablets and access to corporate and outside networks, and
- Facilitation staff that is well versed in different types of innovation, planning and problem solving processes
The decision room as a “memory theater”
Sibbett compares a decision room to a play in a theater, where different parts of the stage may be used to depict different settings. For example, the left side of the stage may be deciated to a narrator, who stands under a spotlight and provides context for the story. The middle and right side of the stage contain scenes that represent two locations where the action of the play takes place. Through clever set design, staging and lighting, the audience gets a sense of space and location.
A decision room provides managers and leaders with a similar sense of place, which enables them to see information and ideas from different points of view, in much the same way that different parts of the stage give us different perspectives on what’s happening in the play. It also provides a shared memory of what has been discussed, helping team members reach consensus faster, rather than arguing over different interpretations of what was previously discussed.
Like the stage in a play, different parts of the decision room can be dedicated to different parts of the group’s thinking and planning processes. For example, one wall of the room can be used to explore what has happened to the company in the past. A second wall can detail current challenges and opportunities. And a third wall can be dedicated to envisioning the future of the organization. Creating this sense of space is essential to helping people think bigger and envision new possibilities, Sibbett explains.
Options and criteria
Most of what senior executives and leaders must decide has two components: options and criteria. Options define what possibilities the group must think about. Often, they are the ideas that have been brainstormed in this rich, visual environment. Criteria are the parameters the group agrees upon to evaluate ideas and possibilities. By making options and criteria tangible and explicit, the group can better envision the impacts of potential decisions.
Using a template and a set of sticky notes, Sibbett points out that a team can engage in the type of “What if?” analysis that we routinely do every day with computerized spreadsheets. Change the value of one cell in your spreadsheet and you can immediately see the impact. In much the same way, the expansive canvas of a decision room creates a similar capacity to explore various scenarios during decision making.
The decision room and its flexible visual thinking tools can also help senior teams to make better decisions about difficult resource allocation issues, such as where to invest the firm’s limited funds in new products, technologies and business models, and where to cut costs. These are the types of decisions where leaders can never please everyone. But they can often reach consensus on what is in the best interests of the organization, and at least get managers to support a course of action in which they have all had input.
In the book, Sibbett shares the case of a VP at a large New York bank, who had to make $2 million in cuts to his budget. Rather than arbitrarily make the cuts himself, he gathered his 15 direct reports into a two-day meeting and used a graphical display of the company’s structure to envision each area that needed resources to function. He then gave each unit manager a set of sticky notes representing his or her budget, and asked them to “spend” those dollars by placing them where he or she thought they should be allocated.
“This created a visual map of where people thought resources should flow,” Sibbett explains. “Once the group interests were visualized, everyone could then move into a negotiation phase and argue for this or that approach, with the overall map as context.” The sticky notes could be moved around to represent different scenarios, and the managers could immediately see how those decisions would affect their business units and others. Essentially, it got them out of their limited “turf protection” mindset and got everyone to develop a shared vision of what should happen next.
“It was a very painful meeting but the VP achieved his purpose and came out with an agreement that everyone understood and was willing to support. Without a decision room environment, he would have had to dictate the cuts, or work them out with just a couple of his direct reports,” SIbbett reports.
Supporting portfolio decision processes
One of the most successful approaches to innovation so far has been to develop a portfolio of R&D projects, and to incrementally fund them based upon their success in meeting certain growth criteria – in other words, to manage investment in new business opportunities in much the same way that a venture capitalist does.
One of the biggest challenges of portfolio innovation management is deciding what should be included in and excluded from the portfolio. Once again, it’s a resource allocation issue where you as the leader can’t possibly give everyone exactly what they want, but you want your direct reports to reach a consensus about what makes the best sense for the organization, and to support the decisions once they’re made.
In the book, Sibbett shares another example where a decision room made a significant difference. The leader of R&D for a large company was developing his budget for the following year. So here’s what he decided to do:
- He first communicated the criteria that would be used to select the projects that would be included in the next year’s portfolio. These criteria also needed to help the group to decide which activities to stop, which to start and where resources should be reallocated for the best yield. All of these criteria were decided in advance, and were selected to support the company’s overall strategic objectives.
- The leader asked each R&D manager to create a portfolio of their own current resource and project allocations in advance of the meeting, and to place it within a 4×4 matrix that could be shared during their meeting.
- Each R&D manager presented his or her portfolio to the others during the meeting, answered questions from the group, and posted the portfolio on the wall.
- All of the managers co-created an organizational portfolio that drew from all of the individual ones.
This case also illustrates the flexibility that a decision room can provide. Mid-way through this planning meeting, the group realized that it was missing an important dimension in its visualization of an ideal R&D portfolio: the element of time. Some of the projects being discussed had longer time horizons than one year. So the group decided, on the fly, to create a new visualization that placed each project on a multi-year timeline, so the group could see a more complete resource allocation picture. Ultimately, this helped the R&D manager make more intelligent investment decisions based upon when each project needed resources in the next year and in the longer term.
A boon for open innovation teams?
Open innovation projects bring with them a unique set of challenges: You must mesh two teams from different companies, each with its own culture, beliefs and processes around a single project. This can often be difficult and time-consuming, as team members work through numerous issues and figure out how to reach consensus on them. I can easily see how holding these meetings in a decision room could help team members to make their thinking tangible, work through potential models for structuring the joint project, surface and solve any misunderstandings and help them become a cohesive team faster.
By Chuck Frey
About the author
Chuck FreySenior Editor, founded InnovationTools.com and served as its publisher from its launch in 2002 until the partnership with Innovation Management in 2012. He is the publisher of The Mind Mapping Software Blog, the definitive souce for news, trends, tips and best practices for visual mapping tools. A journalist by trade, Chuck has over 14 years of experience in online marketing, and over 10 years experience in business-to-business public relations. His interests include creative problem solving, visual thinking, photography, business strategy and technology. His unique combination of experience and influences enables him to envision new possibilities and opportunities.
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