Why companies that make decisions based on positional power fail and companies that apply idea meritocracies win?

sociologist Michael Dunlop Young in his satirical essay The Rise of the Meritocracy introduced the idea of merit based decision making. Young argued that not all ideas are created equal, not all ideas are meant to be vocalized and certainly not all ideas are to be acted upon. Ideas should be filtered not based on who is producing them, but based on what is backing them up.

In today’s world with social media easing the access to vocalization of thoughts and ideas, we notice an abundance of false acumen spread across multiple platforms, most of the thoughts and the ideas you hear today are based on vocalization power ( whoever has the loudest voice or in today’s terms the highest followership ) not merit and ideation. This is directly contributing to marginalizing expertise and specific knowledge and substituting it for unbacked opinions with no intellectual merit at all.

Many people cover their lack of knowledge, experience and merit by “freedom of speech” or “Freedom of opinion” and the effect of that is creating an ocean of false insinuations, information and theories given that most shared content on social platforms is not verified for validity. 

Opinions are a dime a dozen and hardly any of them matter- Ray Dalio. The financial giant of Bridgewater tackled the problem of opinions headfirst as he led one of the most notable institutes to apply an idea meritocracy-based system.

 An idea meritocracy is based on the merit (the quality and the quantity of the data backing an idea) and not on the source or positional influence of the idea. In simple terms if the CEO is suggesting an idea that has less merit, qualitative and quantitative data to back it, while a janitor is suggesting an opposing idea with more qualitative and quantitative data backing it. The janitor’s idea gets implemented .

WHY IDEA MERITOCRACIES WIN

A meritocracy affects an organization both physiologically as well as financially, where it encourages everyone to detach from their ego and attach to the data, thus when an idea is challenged in a meritocracy it is not personal, it is either the data is of insufficient quality or is not enough, and this gives everyone in the organization the freedom to question and ask the the three Ws What, why and what if.

A meritocracy invites people to build their ideas based on the data, not tweak the data to agree with their ideas which is a fatal error driven by the ego of the hierarchy in most organizations.

Meritocracies create a safe environment where creatives and people of specialty know that the hierarchy or the bureaucracy is not going to get in the way of them implementing what they know is best for the organization as long as they can back it up it also guarantees that people will not end up chasing vanity metrics or fantasies based on the C suite’s “ opinions”

How do I achieve a meritocracy?

To achieve a meritocracy you need the organization to be in a merit based state of mind here is the framework of merit based thinking

1.   I’m defined not by what I know or how much I know, but by the quality of my thinking, listening, learning, relating and collaborating.

2.   My mental models are not reality — they are only my generalized stories of how my world works.[iv]

3.   I’m not my ideas, and I must decouple my beliefs (not values) from my ego.[v]

4.   I must be open-minded and treat my beliefs (not values) as hypotheses to be constantly tested and subject to modification by better data.

5.   My mistakes and failures are opportunities to learn.[vi]

6.   I need to be moved by data first, for me to be able to move the data later.

“As a culture and practice, an Idea Meritocracy can lead to the highest levels of human learning, thinking, listening, relating and collaborating by requiring candor, data-driven decision-making, open-mindedness, and managing one’s thinking and emotions. And it will reduce the big inhibitors of high-quality learning, thinking and effective collaboration by mitigating big egos, emotional defensiveness, closed-mindedness, and fears — of making learning mistakes, being penalized for speaking up or disagreeing with higher-ups, or being fearful of ambiguity and uncertainty. That is the power and beauty of an Idea Meritocracy”. – Edward Hess