Clarifying decision making in high-growth ventures: The use of responsibility charting

Abstract

Many new ventures fail as a result of their inability to navigate successfully through the developmental challenges posed by rapid growth. These issues are particularly salient for founder-owners who often have difficulty in authorizing a more formal structure than the face-to-face, personal mode of operating that led to the organization's initial successes. This article focuses on the developmental transition of decision-making processes when previous strengths, such as informality, may become weaknesses. As the venture becomes more complex, problems are more divergent and less able to be resolved by a single individual or team. The sheer rate of growth can stress the capabilities of the existing structure. The key dilemma for an organization is how to get the necessary clarity and accountability without the rigidity and loss of creativity and motivation that often attends a restructuring. The authors argue that the process and structure of responsibility charting can be a useful tool both to diagnose and to intervene during critical transitions. Through two case examples, the authors assert that the process and results of responsibility charting allow groups to set the rules within which they and others will reach the substantive decisions. One of the most powerful aspects of the process is that it allows a group to discuss the difficult issues of power and authority. Responsibility charting ties discussions about participation and influence to task-related reasons and assures that discussions about who should be involved hinge on the value that their participation would add to the decision. Some caveats to using the process are presented, such as the risk of surfacing latent conflicts before the entrepreneur wants to deal with them or encouraging subordinates to push for delegations that the founder may not be ready to confer. The authors illustrate how responsibility charting can greatly help an organization negotiate the difficult structuring choices during a critical growth slate. As a team-building experience, it clears the air among the original core group and concretely diagnoses difficulties they may be experiencing. Greater clarity on how decisions are to be made and accountability for those decisions result from these discussions. Finally, the decisions are easily communicated to a wider audience—a critical feature given the numbers of new people who join fast-growing new ventures and must learn to operate rapidly and effectively.