What is the real cost of indecision at work?

That gap, between a question arriving and your answer leaving, is where most of the cost of indecision lives.

What is the real cost of indecision at work?

It’s the time other people lose while a decision waits for you. For most senior managers, the cost isn’t dithering over one big call. It’s dozens of small calls, each waiting a day or two, each holding up a few people.

When people search for the cost of indecision, they often picture a leader frozen in front of a hard choice. That happens, but it’s rare. The everyday version is duller and far more expensive: approvals, sign-offs and “quick views” that sit in your inbox while the people who asked for them wait, chase or guess.

We call the running total decision debt: the time and money a team loses while waiting for one person to decide. Like financial debt, a little is normal. It becomes a problem when it grows faster than you pay it down, and it grows fastest once you lead other managers, because each decision now holds up their teams as well as them.

Why is slow decision making so expensive for a business?

Because the delay multiplies. One decision held for 3 days doesn’t cost you 3 days. It costs every blocked person their share of those 3 days, plus the rework when someone guessed wrong.

The research suggests speed matters as much as getting the call right. Bain & Company surveyed almost 800 companies and found what it called a 95 percent correlation between companies that excel at making and executing key decisions and those with strong financial results, such as revenue growth and shareholder return. The article treats speed as part of an effective decision, alongside its quality, how well it’s carried out and whether the effort fits what’s at stake.

The same Bain piece describes a company that was good at making the right choices. Where it fell short was speed, and the effort it took to make things happen. In another example, “nobody really knew who had the final say,” which delayed implementation and diluted accountability. That last point is the one to remember. A lot of slow decisions aren’t slow because the decision is hard. They’re slow because the decision has nowhere to go except up.

How do you work out what waiting on you costs?

Multiply five numbers for each kind of decision that waits on you: how many arrive a week × how many working days each one waits × how many people it blocks × how many hours each blocked person loses a day × what an hour of their time costs. Then add the kinds together.

Each part is simple:

• Decisions a week: count by kind, not one by one. Spend approvals, priority calls between teams, hiring sign-offs.
• Days waiting: the working days between the question arriving and your answer going back.
• People blocked: everyone who can’t move until you answer, not just the person who asked.
• Hours lost: blocked people rarely sit idle. They switch tasks, chase you, or start on a guess. So only part of their day is lost. Put in your own estimate of that share.
• Cost per hour: what an hour of a person costs the organisation, including on-costs, not just their pay. A team average is fine.

You don’t need exact figures. The point is the order of magnitude, and which kind of decision is costing you most.

What does that look like for a real team?

Here’s a worked example. It’s an illustration with round, made-up numbers, not a real company, and the currency is plain “units” so you can swap in your own.

Say you lead 4 managers. Three kinds of decision regularly wait for you. We’ll assume an 8-hour working day and that a blocked person loses a quarter of each day they wait. That share is our assumption, not a research figure, so use your own. A quarter of 8 hours is 2 hours lost per blocked person per day waited.

Spend approvals. 3 a week, each waits 2 days, each blocks 1 person. 3 × 2 × 1 = 6 blocked days × 2 hours = 12 hours a week

Priority calls between teams. 1 a week, waits 3 days, blocks 4 people. 1 × 3 × 4 = 12 blocked days × 2 hours = 24 hours a week

Hiring sign-off. 1 a week, waits 4 days, blocks 1 person. 1 × 4 × 1 = 4 blocked days × 2 hours = 8 hours a week

Add them up: 12 + 24 + 8 = 44 hours a week of other people’s time.

Now put a value on it. Say an hour of a blocked person costs the organisation 40 units, an example figure.

• Per week: 44 hours × 40 units = 1,760 units
• Per year, over 46 working weeks: 1,760 × 46 = 80,960 units
• Time: 44 × 46 = 2,024 hours a year

That’s more than one full-time person’s working year (about 1,800 hours), spent waiting for you. And it’s only 5 decisions a week.

Look at which kind costs most. You make spend approvals three times as often as priority calls, so they feel like the bigger burden. But the priority call blocks 4 people for 3 days, so it costs twice as much: 24 hours a week, 960 units, or 44,160 units a year. That’s 55% of the total from one decision a week.

This is the pattern to look for. The decision that lands on your desk most often is rarely the most expensive one. The one that blocks the most people for the longest usually is. If you only hand down one kind, hand down that one.

A quick self-check before you go on:

Which decisions should you hand down first?

Start with the most expensive kind that is also easy to undo. If you would say yes to it 9 times out of 10, it probably belongs to someone else already.

Two tests help you sort the list.

Can it be reversed? Jeff Bezos, in his 2016 letter to Amazon shareholders, put it simply: “Many decisions are reversible, two-way doors.” He argued those decisions can use a light-weight process. If a call can be undone in a week without much harm, it doesn’t need to queue for you.

Is it expensive to wait for? Run the formula above. Rank your decision kinds by yearly cost. The top one, if it’s reversible, is your first hand-down.

Some decisions should stay with you, at least for now. Senior hires, big commitments of money, changes to strategy, anything with legal or ethical risk. These are the one-way doors. They deserve your time, and handing down the reversible ones gives you more of it.

If you’re finding it hard to let go even of the easy ones, that’s common. Why do managers struggle to delegate? looks at the habits that keep decisions stuck with you, and approving everything is one of them.

How do you hand a decision down so it doesn’t bounce back?

Write down who decides now, up to what limit, and tell everyone affected. A decision handed down quietly comes straight back up, because people keep routing it to you out of habit.

Four steps that work:

• Name the decision and the owner. “Priority calls between Product and Support now sit with the two team leads. If they can’t agree in a day, it comes to me.”
• Set a limit. Spend under a set amount, hires below a certain level, changes that can be undone within a sprint. Below the line, they decide and tell you afterwards.
• Tell their teams. If the people below don’t know the decision has moved, they’ll keep asking you, and your managers will be bypassed.
• Let a different call stand. If your manager makes a reasonable decision you’d have made differently, leave it. Talk about it in your next one-on-one if you must. Overturning good-enough calls teaches everyone to send the next one to you.

Bezos has a phrase for that last step. When a group can’t reach agreement but the call needs making, he suggests saying “disagree and commit,” and adds that the phrase “will save a lot of time.” It works in both directions. You can disagree with your manager’s call and still back it.

Isn’t a slow decision safer than a wrong one?

Sometimes, for one-way doors. For most everyday decisions, no. The cost of waiting is certain. The cost of a wrong call that you can reverse is usually small.

Bezos argues in the same letter that most decisions can be made with “somewhere around 70% of the information you wish you had.” If you wait for 90%, he says, you’re probably being slow. And he points out that “being slow is going to be expensive for sure,” while being wrong may cost less than you think, as long as you’re quick to recognise and correct a bad call.

You don’t have to run a company of Amazon’s size for that to apply. In the worked example, waiting cost 80,960 units a year. Ask yourself honestly how many of those decisions, if your managers had got one wrong, would have cost anything like that to put right.

There’s also a cost the formula can’t count. When decisions wait, people learn that their judgement isn’t trusted. The capable ones stop bringing you options and start bringing you questions. That makes the queue longer, and it makes the people you most want to grow less likely to stay.

How do you stop the queue building up again?

Give decisions a fixed place to land and a fixed time to leave. Debt you don’t track grows back.

Three habits help:

• A decision day. Clear everything waiting on you at a set time each week, say Tuesday at 10. Nothing then waits more than a week, and most wait far less. If something can’t wait until Tuesday, it’s probably a decision someone else should be making.
• A decisions log. One shared page: what was decided, by whom, and when. It stops people asking you again, and it shows your managers which calls are now theirs.
• A quarterly recount. Every 3 months, list the kinds of decision still waiting on you and rerun the numbers. Expect one or two to creep back. Hand them down again.

Meetings are a common hiding place for decision debt, too. If a weekly meeting exists mainly so people can get your view, the decision is waiting for the meeting. How much do recurring meetings cost my team? shows how to put a price on those as well.

Where do you start?

Put your own numbers in. The free Decision Debt calculator does the arithmetic above for every kind of decision that waits on you, in your own currency. It shows the hours and money lost a week and a year, and the most expensive kind of decision to hand down first. There’s no sign-up, it runs in your browser and it uses only the numbers you type in. Nothing is sent anywhere. It doesn’t judge you. It just shows where the waiting goes.

If you want to see the habits behind the queue, The 42 Test is also free. It asks how often you let someone else’s decision stand, alongside 41 other everyday behaviours. Amplifier or Bottleneck looks at the same pattern from your team’s side. And for more on leading through other leaders, see managers of managers.