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Are self-managed organizations based on consensus?

Patrick Lencioni had a wonderful keynote today at Nordic Business Forum.

Someone in the audience asked a question about what Lencioni thought about self-managed organizations and he responded that he didn't believe that you could run organization without hierarchy and concentrated authority, because that would lead to consensus and consensus makes decisions slow and leaves people frustrated in the end.

He was right about that consensus does not work, but he made a common false assumption that self-managed organizations are based on consensus.

We often hold assumption that decisions can be made in one of two ways: either by a person with authority (someone says what to do, some people might get frustrated, but things get done) or by consensus (everyone has their say, but decisions take too long).

Instead self-organized organizations often use something called "advice process". In the advice process, power and responsibility and ownership of the issue stays clearly with one person: the decision maker. The decision maker usually is a person who first noticed the issue, is most affected by it or has the most expertise on the matter.

In the advice process, the decision maker can make any decision after seeking advice from 1) everyone who will be meaningfully affected, and 2) people with expertise in the matter.

Advice received must be taken into consideration. The point is not to create a watered-down compromise that accommodates everybody’s wishes. It is about accessing collective wisdom in pursuit of a sound decision. With all the advice and perspectives the decision maker has received, they choose what they believe to be the best course of action.

Advice is simply advice. No colleague, whatever their importance, can tell a decision-maker what to decide.

In practice, this process proves remarkably effective. It allows anybody to seize the initiative. Power is no longer a zero-sum game. Everyone is powerful via the advice process. 

So we can forget the notion that self-managed organizations are based on consensus. They are not. With the advice process they transcend both the top-down and the consensus based decision making.

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