Henrik Ekelund champions a shift towards decentralised decision-making in today’s fast-paced business environment 

Organisations today are struggling with decision-making more than ever before. In an era where technological innovations and global macrotrends are redefining the way we do business, the traditional hierarchical models of corporate governance are proving to be not just inadequate but a barrier to success. The old ways of command-and-control leadership slow down progress and stifle innovation. They create and reinforce silos and prevent those further down the organisation from acting based on their own relevant knowledge and experience.  

Empowering individuals to make decisions is not merely a concession to these trends, but a strategic imperative  

Future success belongs to organisations who have the culture, tools and leadership in place to empower and enable their people – across all levels of the organisation – to make insightful decisions and contributions, and to take action when needed. The leaders of tomorrow must reach beyond immediate ideas and source new possibilities. The ability to act, pivot and move the business forward in an agile way is the fundamental lever. 

Making the transition from centralised to decentralised decision-making is no easy change. Merely shifting operations doesn’t deliver the fundamental change in ways of working that is required to move the needle. Thriving well into the future means that today’s leaders must guide their organisations – and themselves – to profoundly alter the way they make decisions, preparing others to lead and deliver on the strategy.  

The obsolescence of traditional decision-making 

The business world of yesteryear thrived on stability and control. The business world moved more slowly. Big changes happened more infrequently. Long-term strategies and decisions flowed top-down, from the boardroom to the front lines, guided by a belief in the authority of experience over the dynamism of data and innovation. However, two critical shifts have rendered this model obsolete: 

1. Accelerating pace of change: The speed at which new technologies emerge and market dynamics evolve has outpaced the ability of traditional models to respond. In a landscape where agility trumps size, the old hierarchies that delay action until consensus is reached at the highest levels are a liability. 

2. Cultural evolution: The aspirations of the modern workforce have evolved. Today’s employees value autonomy, seek purpose, and demand a voice in the strategic direction of their organisations. The desire for impact and a meaningful career path is driving a generational shift towards workplaces that value contributions over titles. 

The strategic imperative for decentralisation 

Empowering individuals to make decisions is not merely a concession to these trends, but a strategic imperative. Decentralised decision-making enables organisations to respond with alacrity to customer needs, technological advancements, and market changes.  

This approach is exemplified by the transformation of multinational corporations like ABB, which dismantled its rigid matrix structure in favour of nimble, autonomous business units led by entrepreneurial leaders. This strategic pivot not only accelerated decision-making but also fostered an environment where innovation flourishes. 

Embracing the shift: A cultural and operational blueprint 

The journey towards a decentralised model requires a fundamental change in organisational culture, structures and processes, to create the environment to support decision-making up and down the chain.  

There are four components required for the shift to work:  

1. Strategic clarity: Clear articulation of the company’s vision, goals, strategy and values is crucial. Creating clarity about your strategy upfront, enables others throughout the organisation to make better decisions along the way. The onus is on the organisation’s leadership to provide this clarity. This provides a North Star for all the organisation’s actions, providing the necessary guide for decentralised decision-making and ensuring alignment with overarching goals. 

2. Empowerment through learning and accountability: Empowering individuals to make decisions requires a parallel commitment to developing their capability to do so effectively. This includes providing access to relevant data and fostering a culture of continuous learning, while making it safe to experiment and fail in order to improve and advance. This must go hand-in-hand with a framework of accountability, where everyone from top to bottom owns the outcome of their decisions. 

3. Cultural transformation: The shift to a more decentralised model necessitates a cultural transformation that supports the move away from command and control. A culture that is characterised by trust, openness, inclusivity and feedback is a prerequisite for successful decentralised decision-making. This involves moving away from a compliance-based model to one that values initiative, creativity and calculated risk-taking. Too much openness and inclusivity in decisions, however, can also create challenge – decisions can easily be stalled if you over flex and allow too many opinions to muck up efficiency. Creating clarity around roles and ownership in a decentralised model allows organisations to strike the right balance and avoid the pitfalls of either extreme.  

4. Technology as an enabler: Leveraging technology to democratise access to data and insights enables informed decision-making at all levels. Access to data, insights and information about all aspects of the business opens the door to action and understanding of consequences. But technology is not the endpoint. The challenge for leaders is to complement this technological backbone with a human-centric approach to leadership and management, ensuring they recognise the unique value of human intuition and creativity. 

The path forward: Leadership in a new, decentralised business era 

The role of leadership in this new era is not diminished but transformed. Leaders have the tremendous opportunity and responsibility to become visionaries who empower, guide and inspire rather than dictate. The success stories of organisations that have embraced this shift, like ABB, offer a compelling blueprint for others to follow. These leaders understand the delicate balance between giving direction and granting autonomy; between ensuring coherence in strategy and nurturing diversity in thought and action. 

A call to action for future-focused leaders 

The transition toward a more empowered, decentralised approach to decision-making is not just an operational necessity. It’s a strategic imperative for survival and success in the 21st century. This manifesto is a call to action for leaders willing to challenge the status quo, to reimagine what leadership looks like in an age of rapid change and complexity. 

As we stand on the brink of this transformation, the question is not whether we will face challenges, but how we will navigate them. Will we cling to outdated models and mindsets, or will we have the courage to lead boldly, embracing the principles of empowerment, agility and innovation? 

The future is not a distant horizon; it is the reality we are stepping into today. It beckons with promises of unprecedented opportunities for those brave enough to lead the charge. Let us not shy away from this moment. The journey ahead is fraught with challenges, but it is also rich with potential. As leaders, let us forge a path that leverages the best of our collective talents. 

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Henrik Ekelund, Founder and Chair of BTS Group