Formalize Escalation Procedures to Improve Decision-Making

Conflict is inevitable. A systematic approach to escalation helps organizations manage disagreements efficiently and make better decisions.

- By Jonathan Hughes and Gabriella Salvatore

THE CEO OF A FAST-GROWING pharmaceutical startup recently forwarded us an email exchange he had had with his chief financial and chief commercial officers.

It seems that the CCO had surprised both the CEO and CFO by proposing to spend more than $450,000 to retain an outside agency.

The CFO immediately fired off a private email to the CEO: “We are in total lockdown mode while we raise Series C funds. We just got a $75 million bridge loan. Why isn’t she coming to me? I should be included in these decisions.” The CEO responded, “I assume if a member of the executive leadership team brings me a proposal, they’ve talked it through with their colleagues.” The CFO replied, “Well, she didn’t!”

Considering this exchange, we told the CEO, “It seems that members of your team immediately jump to escalating issues to you versus trying to resolve those issues themselves.” We added that it would have been better if they had first tried to talk to each other and sort out the issue. If they still had a difference of opinion, they should have documented why they disagreed and how they had tried to resolve it. Then, and only then, should they have gone to the CEO to discuss it — together.