We asked business leaders from around the world for their perspectives on the decision-making challenges they face and how their organisations are rising to these challenges to improve their competitive advantage.
Mark Weinberger, Global Chairman and CEO of EY, speaks about the decision-making approach at EY, one of the world’s largest professional services organisations.
What sources of information do you rely on when making decisions for your business?
As business has become more global, it has become more interconnected, and this has changed decision making in business. Take the 2011 Japanese tsunami, the initial reaction was understandably around the human toll, but very quickly businesses realised that their supply chains were about to be disrupted.
Therefore, CEOs and senior leaders of organisations have to be more aware of the broader global environment they are operating in. I rely on both my global leadership team and my regional and local leadership teams. We’re in 152 countries so we really have to understand what the business is going through in each region.
I spend 4 or 5 days a week on the road. There’s no substitute for being there and talking, both to your own people and also to local regulators and government officials to understand what’s on their minds and what challenges they are trying to address, which is helpful to know as you’re crafting a business strategy.
I also spend a lot of time talking to our clients – we have over 200,000 clients, in all geographies and every industry. Talking to them about the challenges they are facing also helps me put together patterns and see trends in a way I couldn’t if I was just talking to our own people.
How would you describe the decision-making approach in your organisation?
As an organisation, we believe in the power of teaming. At EY we call it high performing teaming, and it’s important for our client teams at the engagement level all the way through to our leadership teams at the global level.
When making a decision it is first crucial to have the right people in the room, the right team who will ask the right questions so that you get better answers. I believe that means having a team with diverse backgrounds and perspectives.
Then you have to set the right agenda for those people so that they are looking at where risks could arise, where opportunities may be and where external factors are changing strategic or operational decisions.
You need to have in place an effective pipeline for getting the information to your teams to make decisions and you need to separate the noise from the signals. For instance, it’s important to not let short term fluctuations distract from longer-term trends.
Emerging markets are a great example of this. In the short term there will be a lot of uncertainty in emerging markets like China, Brazil and India, but over the long-term they will definitely be growth opportunities. At EY, we are still investing heavily in emerging markets because we know that by 2020, almost 30% of our revenue will come from emerging markets.
Today, another important piece of making decisions is data. Data more than ever is helping both EY and our clients solve problems, improve operations and create efficiencies. Data analytics is a big investment of ours and it’s an accelerator of solutions we present to clients to address their issues. But, analysing data is almost the easiest thing we do. The value comes when turning that data into knowledge and helping to make the data an accessible and useful tool in problem solving.
How do you ensure that people are driven to make decisions that deliver value not just for the short term, but for the medium and long-term?
Two-way communication has probably never been more important. The world is moving fast, but if you want employees to take a long-term view of your company they need to understand where you’re positioning the organisation for the future. They have to understand the why, not just the what. If your people are engaged in your long-term vision, they won’t be distracted by every bump along the way.
This is more relevant for our people than ever; this generation wants to understand your long term vision and wants to create a legacy that isn't measured in how much money they accumulate. At EY, this is where our culture becomes very important, and our shared purpose of building a better working world. It gives our 220,000 people a clear view of their legacy.
Is there collaboration across the hierarchy of your business, between executives, leaders and employees, which creates a more inclusive decision-making process, rather than it being a top-down approach?
Yes. The days of the imperial CEO are over. No one person has all the information necessary to make decisions, not in this globally integrated world. Clearly, you have to stay better connected now, and decisions have to be made in a more inclusive way. It’s also really important that you have accountability throughout the organisation. Within teams, each team member has to be held accountable to each other, but also the leadership needs to take that accountability.
How do you get the balance right between maintaining agile decision-making processes and being able to act decisively where it's needed? When you bring more people into the process, how do you ensure that this doesn’t create bureaucracy and delays?
It's really important to have a very clear strategy so that people understand what you're trying to achieve. This shouldn't go back and forth daily with debate. When you have 220,000 people, you can't keep changing directions. You entertain a lot of discussion, but you have to be clear on what's negotiable and what's not negotiable in terms of where you're going to make changes. This comes down to very consistent communication across the organisation.
High quality decision making has never been more important — or more difficult. Learn more about what leading organisations are doing to overcome these challenges at cgma.org/joiningthedots.