Designing Well #1

Management is a continuous process of making decisions.

A year and a half ago, I joined the management of a startup called Nesto as its Chief Experience Officer (CXO). Since launching our service, I’ve been working hard to move our company forward. We are still facing a variety of challenges in the so-called “early phase” of our business.

The pressure is constant. Dwindling cash, numbers that fail to meet our goals, the urge to try as many things as possible in the limited time we have, pressure to speed up our operations… It’s true that both speed and volume of work are essential. But I started to question myself, does speed of work necessarily lead to the best decision making? 

“If you want to go fast, go alone; if you want to go far, go together.” That’s said to be an African proverb, although the source isn’t clear. “Going together” is the hard part. Involving more people and leveraging their knowledge can lead to better decisions, but often at the cost of speed.

How can we create a system that balances the speed of one with the wisdom of many? At Nesto, we’re trying to build a system that offers a broad perspective for better decision-making without sacrificing speed.

We are still in the midst of that process, but I’d like to share one practical example: our Shared Executive Meetings.

Shared Executive Meetings

We have tried different approaches at Nesto.  At one point, everything was unilaterally decided by the president; at another, decisions were made by everyone together, even at the cost of speed. These days, we take an approach where individuals make decisions while considering a wide range of perspectives. In other words, members who are fully committed to a particular area can typically make decisions without any consultation. It took us more than a year to build the trust needed for this at Nesto.

We believe that the key to better management is building relationships of trust between stakeholders and improving each individual’s decision-making process. Our Shared Executive Meetings are one of the ways we aim to achieve that.

These meetings are shared not only to employees and shareholders, but also to our users — one of the reasons we call them “Shared Executive Meetings.” Although some information is handled separately for compliance and other reasons, users who attend can learn almost everything about Nesto’s weekly activities.

During the meeting, members of the management (executives) and occasionally others talk about their progress that week and their plans for next week. All participants are free to comment. For example: “If it were me, I would do it like this.” “Have you considered this point of view?” “This is great.” “I think it would make more sense to do it this way.”  “Maybe we should work together here.” The person receiving the comment can make use of it, ignore it, dig deeper or ask to collaborate.

Participants are free to post their thoughts in the Zoom chat, and we set aside time for comments at the end of each session. Sometimes messages are even sent later in the day. However, as mentioned above, there is no obligation to follow these suggestions. It doesn’t matter whether the comment is from a user or a fellow member of executive management. Decisions are always made by the person who best understands the context, within the scope of their responsibility.

Advantages of Sharing Executive Meetings

1. Broader perspectives

Listening to participants’ comments is often helpful. I often find myself thinking, “I see,” or, “That makes more sense.” And it’s encouraging when users offer their affirmation.

There is a limit to the breadth of a single person’s perspective. By considering more viewpoints from a variety of positions, we can make better decisions.

In his book “Open,” Johan Norberg writes:

“Groups are better at solving problems if they are diverse. Those groups also have more friction. There is a greater risk that someone will question the assumptions or object to a quick solution, and this makes the whole process less smooth and comfortable. But this is precisely why we need it. Groups that are too similar are easily afflicted with group thinking – objections are not raised, alternatives are not explored and the group mainly looks for information that confirms what they already thought. People often self-censor so that they don’t come to be seen as troublesome or used as scapegoats if anything goes wrong.”

From Open: The Story of Human Progress by Johan Norberg

When you agonize over an issue with the same group of people, the assumptions of those in the group start to converge. Adding even a few outside voices can deepen our thoughts  and point the way to alternative solutions.

It can be uncomfortable to hear opinions that differ from my own, but I believe that this diversity of perspectives leads to better decisions.

2. Decisions can still be made efficiently

We held a Nesto General Meeting every three months, a practice we started before the Shared Executive Meetings. These General Meetings are separate from our normal managerial meetings.  While the main participants are executive management and shareholders, employees and users can also attend. We discuss our numerical progress, review measures we have taken and explore our goals. To ensure that the meetings are easy to understand, we do some preparation in advance, such as putting together materials, and go over the details with participants.

But for Shared Executive Meetings, we make no such efforts. They are management meetings for executive members. For the most part, other participants simply listen. The meetings are held regardless of whether or not there are outside participants, so no preparation is necessary. These are not special communication forums for stakeholders, but simply an open window into our management process. That allows us to get through them without putting aside extra time.

Before we started these meetings, we were stuck on the idea that it would prolong decision-making to involve more people in the management process who lack a full understanding of the context. Now, we understand that simply opening the process up does not mean that we need to fully incorporate everyone’s opinions. The manager in question remains responsible for the decision, relying on others’ opinions only at their discretion. That allows the speed of decision-making to be maintained.

3. Building trust

Not all stakeholders want to actively learn about and engage with management. Even at Nesto, only a small percentage come to Shared Executive Meetings.

But our experience has shown us that certain users and employees are passionate about what we do. I now think it would be a loss of opportunity not to give those people a chance to participate.

People who attend our Shared Executive Meetings tend to gain some understanding of the context of our managerial decisions. As a result, we now have more people who can help us think through issues with a solid understanding of both the big picture and the context. That benefits both sides.

In business, people often urge you to tell them bad news as soon as possible. Doing so gives them more time to advise and intervene. That’s an undeniable truth, but people still tend to delay bad news until the final results come in, hoping they’ll somehow be able to save the situation. Shared Executive Meetings have helped me get into the habit of sharing bad news with those around me as soon as possible. I now have the confidence to do so. These days, more and more people are asking questions about the integrity of the companies they deal with. ”Is this a company that I want to trust?” Some of my favorite companies have started opening up their operations. For example, Nothing, a digital product manufacturer, has a “community board member” system that allows users to attend management meetings as representatives. Gumroad, a platform for buying and selling digital content, uploads its board meetings to YouTube where anyone can watch them. When a company takes an open approach like that, it makes me want to choose their service or brand. The stance of a company should invite a sense of security and trust.

Salvation for the lonely manager

Shared Executive Meetings are just one way to achieve better management.

For the most part, these meetings only bring a small number of highly passionate or vocal people into the fold. The meetings are a passive measure on the part of management, and cannot offer a full range of perspectives. That’s why Nesto is currently working to supplement our open meetings with more active measures, such as building a system for surveying stakeholders.

But the passivity of simply opening up part of the executive management process is exactly what makes it so easy to implement.

Before trying it, you might think that your employees and users have no interest in management. Even at Nesto, we didn’t really expect people to join the Shared Executive Meetings.

It’s often said that management is a lonely task.

I experience the difficulty of managing a startup every day. We started this business with great ambition, but there are times when the numbers don’t reflect.  I often feel like I’ve let down the people who believed in me, or that I don’t have what it takes. But I’m not alone — there are others who are willing to help me chart the way forward. Taking an open approach has increased the supporter, and my motivation alongside it. In fact, it may be us the executive managers who are helped the most by making the business more open.

There is no need to make everything open right away, and openness isn’t the only possible approach. How can we make decisions based on more diverse opinions? How can we involve more people who are passionate about what we do? I would love to hear your ideas.