Will Obama's decision-making style work?


I am arranging my day around watching President-elect Obama's inauguration. But as I think about the two wars and economic collapse that his weepy, self-pitying predecessor leaves in Obama's lap, I am wondering whether Obama can fix what ails us. The way he makes decisions suggests that he'll get good ideas and pick the best. But it will be a while before we know whether those ideas work.

Obama surrounds himself with the best people, starts meetings with questions he wants answered, and expects those people to argue for different answers to the questions. He probes each person to understand the logic and data behind their thinking. At the end, he sums up what he's learned and what decision he is leaning towards. So far he's staffed a diverse team; let one of his nominees, Bill Richardson, go; lobbied Congress to release the second $350 billion in financial bailout money; and started negotiating an $825 billion spending and tax break package.

His leadership style is similar to that of Boeing (NYSE: BA) CEO Jim McNerney. McNerney can take a team of people from different business functions and say, "Here are 10 possible strategies. We're not leaving this room until we all agree on which one we're going to follow." Then he gives people the authority to exercise their intellectual freedom. He encourages them to speak their minds. He demands debate. He lets them express their opinions without fear of retaliation. When the team implements the strategy, it does so with enthusiasm because it feels ownership.

I believe that this is the right approach to making decisions and getting buy-in from people who execute those decisions. And I hope it works as well for Obama as it does for McNerney.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College. Portfolio recently published his eighth book, You Can't Order Change: Lessons From Jim McNerney's Turnaround at Boeing. He has no financial interest in Boeing securities.

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