Every day in running a successful business, decisions must be made. As the business scales, though, this gets harder and harder to manage. The challenge is to ensure that people have enough autonomy to do their job, but also recognize when decisions need other people involved.
An effective way to manage this is establishing a “Delegation of Authority” policy and register. It starts with the Board. The Board, as part of its engagement with the CEO, should clearly state what decisions need to be brought to them for consideration and final approval, and which ones the CEO can make within their team.
The CEO can then further break down the delegation of authority that they have been given to people and teams in their organization. This doesn’t have to be onerous but provides guidelines and accountability to all. A balance can be struck and adjusted over time. Regular reviews will continue to evolve the business and mature it.
