As a business grows, it adds structure. There is a management meeting, a few managers with titles, perhaps an organisation chart and a responsibility matrix showing who is responsible for what. The structure can look convincing while leaving the most important questions unanswered. Who can approve a significant change to a job? Who decides when two projects need the same people? Who can accept a lower margin to keep a customer? Who can stop a contract that is losing money? What happens when two managers disagree?
Those are decision rights. Until they are clear, meetings and charts are mostly administration. Decisions wait for the owner, get debated repeatedly without closure, or are made quietly by whoever acts first. The symptoms are familiar: a management meeting that hears reports but rarely decides anything, a backlog of approvals sitting in one inbox, and the same issue appearing on the agenda month after month.
This article explains how to design decision rights before designing meetings: how to tell participation from authority, why a responsibility chart cannot create accountability, how to match the way a decision is made to the kind of decision it is, and how to turn a reporting meeting into one that actually decides. It is general information for owners and managers of growing businesses.
Participation is not authority
Ten people may attend a meeting, but if nobody knows who has the final say, the decision can stay stuck. Three common confusions:
- Seniority equals authority. A senior manager may run a department but have no right to change a project’s budget or scope. Conversely, someone may formally own a project while the people and money it needs sit with others.
- Authority means approvals. Real decision rights also include the right to ask for evidence, challenge assumptions, escalate, redirect work and stop it.
- One structure fits everything. A business winning large tenders and a business running small repeat jobs need different rhythms and delegations, even if the principles are the same.
The aim is to place each decision at the lowest level that has enough information, authority and view of the whole business to make it well. Too much centralisation slows everything down. Too much delegation fragments the business into people making commitments others must honour.
A responsibility chart describes participation, not ownership
Responsibility charts, often called RACI charts, mark who is Responsible, Accountable, Consulted and Informed for each task. They are useful for coordinating work. They are often asked to do something they cannot: create accountability.
A letter “A” in a spreadsheet does not give someone the authority, information or capacity to own a result. And task ownership differs from decision ownership: one person may prepare a design change, while someone else approves the technical risk, another the cost and a fourth the customer impact.
For accountability to mean anything, four conditions must hold:
- The expected outcome is clear.
- The accountable person can influence the factors that decide it.
- The decisions they need are within their authority, or there is a clear route to get them made.
- Performance and consequences are visible.
If a manager is accountable for delivery but cannot secure people, approve trade-offs or get timely decisions from above, the business has created responsibility without control. That is not empowerment; it is ambiguity.
Use responsibility charts for tasks. For the decisions that matter, keep a decision register:
| Element | What to define |
|---|---|
| Decision | What exactly is being decided? |
| Owner | Who has final authority? |
| Inputs | Who must provide evidence or advice? |
| Limits | What thresholds require escalation? |
| Record | Where is the decision and its reasoning kept? |
Technical authority and business authority differ
In many businesses, two kinds of authority sit side by side. The person running a job owns coordination, schedule and the customer relationship. A qualified tradesperson, engineer or designer holds technical authority over whether work is safe, compliant and fit for purpose. The owner or a manager holds authority over money and commitments.
Strong governance does not collapse these into one person. It defines where they meet. A project lead should not be able to override a technical judgement on safety to protect a date, and a technical lead should not be able to commit the business to extra cost without the person who controls the budget. Write down which decisions need both, and who breaks a tie.
Match the process to the decision
Not every decision should be made the same way. Six questions help decide who should decide and how others take part:
- Consequence: how much is at stake?
- Reversibility: can it be undone cheaply if wrong?
- Expertise: where is the knowledge needed for a good decision?
- Acceptance: does success depend on the active support of the people affected?
- Urgency: how much time is really available?
- Authority: who is legitimately accountable?
A reversible trial can be delegated; evidence will arrive quickly and course can change. A major contract or irreversible purchase justifies wider challenge and higher authority. Where implementation depends on people’s cooperation, involve them in shaping the decision. Where it does not, clear authority is enough. Broad input and narrow accountability often work best: many people contribute evidence, one person or group decides.
A practical approach is to define a few decision classes: routine decisions that stay with the people doing the work, material but reversible decisions delegated to managers, high-consequence or hard-to-reverse decisions that go to the owner, and emergency decisions that follow agreed rules.
Money authority should follow accountability
Approval limits by dollar amount are a common form of delegation. They do not answer who can change scope, accept a risk, use contingency or trade cost for time. And they can create gaps: a manager judged on a budget may reject maintenance that would protect reliability, or approve a sale that creates costs elsewhere.
For significant decisions, be able to say:
- who owns the business result;
- who controls the money;
- who can change the scope;
- who can accept a material risk;
- who decides whether to continue when assumptions change.
These can be different people, as long as the connections between them are explicit. Add consequence thresholds alongside money thresholds: a decision touching safety, legal compliance, a key customer or the business’s reputation may need higher authority even when the amount is small. The what your people can commit you to article covers the commitments everyday work creates beyond spending limits.
A meeting that only receives reports is not governing
A management meeting that hears updates, notes risks and asks for another update next month provides visibility without governance. Visibility is useful, but a business can know a project is in trouble and still fail to act.
A meeting that governs does four things:
- Tests whether major commitments still make sense, given what has changed.
- Resolves trade-offs that cannot be settled lower down, such as competing claims on the same people.
- Accepts or rejects material risks.
- Intervenes when limits are crossed: accept, change, defer or stop.
Change the agenda to match. Put decisions required first and status last, time-limited. Ask every proposal to present at least two options with a recommendation and the cost of delay; return any paper with only one option. A useful test: if this meeting has never chosen between two options, it is not steering. If a meeting contains no material decision, ask whether it needed to be a meeting.
Be honest about what each meeting is for. Some meetings deliberate; some ratify decisions shaped beforehand; some mainly share information. All can be legitimate. Problems arise when a meeting claims to decide but actually ratifies, or when the time allowed makes real deliberation impossible. And remember that whoever sets the agenda and frames the options holds real influence over the outcome.
Measure how long decisions take
One practical test of governance is decision latency: how long important decisions stay unresolved. Slow decisions are not always bad; irreversible ones may deserve time. But repeated delay because nobody knows who can decide is a design failure.
Latency often grows when people who should be consulted acquire an informal veto, because nobody has said where consultation ends and authority begins. It also grows when every decision waits for one person. Track a few recurring decisions, such as approving a variation, a quote, a hire or a purchase, and how long each typically waits.
Keep governance light
Governance can reduce complexity or add to it. Each extra approval, meeting and report creates another step people must navigate. Controls are often added after a problem and never removed. Before adding another meeting or approval, ask:
- What does it protect?
- What decisions can it actually make?
- What information does it genuinely need?
- What cannot be resolved lower down?
- Is it fast enough for how quickly things change?
- What time and delay does it cost?
If the first two cannot be answered clearly, the new layer probably is not worth it. The delegating without losing control article covers handing decisions over in stages.
A worked example
This is an illustration. A building services business with 35 staff has an owner, three managers and a monthly management meeting. The meeting runs for two hours, mostly reviewing each manager’s report. Most significant decisions wait for the owner.
The owner tracks four recurring decisions for a month:
- Approving variations over $5,000 on jobs: average wait 11 days, during which crews often work on without agreed pricing.
- Approving quotes over $50,000: average wait 6 days.
- Hiring replacement tradespeople: average wait 3 weeks.
- Deciding whether to keep a maintenance contract that has lost money for two quarters: on the agenda for four months without a decision.
The owner builds a one-page decision register:
- Variations up to $15,000 are approved by the project manager, provided margin stays above an agreed level; above that, or below the margin, they go to the operations manager within two business days.
- Quotes up to $100,000 are approved by the estimating manager using an agreed checklist; above that, the owner decides.
- Replacement hires within the approved headcount are decided by the relevant manager.
- Any decision involving safety, a legal obligation or one of the five largest customers goes to the owner regardless of value.
The monthly meeting is redesigned. The first 45 minutes are for decisions, each presented with options. Reports are read beforehand and discussed only by exception. At the first redesigned meeting, the maintenance contract is decided: the business gives notice to renegotiate, with a clear walk-away price.
Three months later, variation approvals take about two days and the owner spends noticeably less time approving routine items and more on the decisions only the owner can make.
How this applies to a small Australian business
- List the ten decisions that most affect your results over the next six months.
- For each, name the owner, who gives input, the limits and where it is recorded.
- Use responsibility charts for tasks and a decision register for decisions.
- Set decision classes with clear routes for each.
- Add consequence thresholds to money thresholds.
- Put decisions first in management meetings, with at least two options.
- Track decision latency for a few recurring decisions.
- Remove governance that does not protect anything.
Signals worth watching
- Meetings where nothing is decided.
- The same issue on the agenda month after month.
- Approvals queuing with one person.
- Managers accountable for results they cannot influence.
- People who should be consulted acting as vetoes.
- New approvals added after every problem, none removed.
Common mistakes
- Drawing committees before defining decisions.
- Treating a responsibility chart as accountability.
- Delegating money without delegating the related decisions.
- Running meetings that receive reports but do not govern.
- Presenting single-option proposals.
- Adding governance without asking what it costs.
Frequently asked questions
Is this only for larger businesses? No. Even a business with a handful of managers benefits from knowing who can decide what. The register can be one page.
Won’t delegating decisions increase risk? It can reduce it, by getting decisions made faster by the people with the best information, within clear limits and with consequence thresholds for high-stakes matters.
What if managers keep escalating everything? Check whether the limits are clear, whether they have the information to decide, and whether past decisions within their authority were overruled. Fix the cause.
How often should decision rights be reviewed? When the business grows, restructures or changes what it does, and at least once a year.
What belongs in a decision record? The decision, the date, the options considered, the reasoning, who decided and what would cause it to be revisited.
Questions to ask
- Which important decisions have no clear owner?
- Where do decisions wait, and for how long?
- Which meetings decide things, and which only receive reports?
- Are our managers accountable for results they cannot control?
- Which decisions need consequence thresholds, not just dollar limits?
- What governance could we remove without losing protection?
Bringing it together
Good governance starts with decisions, not committees. Define who can decide, redirect and stop each important matter, within what limits, on what evidence and with what record. Use responsibility charts for tasks and a decision register for decisions. Match the way each decision is made to its consequence, reversibility, urgency and need for acceptance, and make money authority follow accountability. Turn reporting meetings into deciding meetings with options and a decisions-first agenda, measure how long decisions wait, and keep governance only where it protects something worth its cost.
Source: KEVOS notes, drawing on teaching material on program and portfolio governance, M. Hanford, “Defining program governance and structure” (IBM, 2005), research by A. Mosavi on the roles of portfolio steering committees, and G. Levin and J. L. Ward (2013) on program governance. Examples and figures in this article are illustrations. This article is general information.
