Risks and Costs of Double-Loop Governance for Your Organization


Yes, you will be giving all your members the power to steer. Image from the Valve New Employee Manual.

Risks and Costs of Double-Loop Governance for Your Organization

There are real costs and real risks in choosing a double-loop governance scheme. Single-loop, top-down management is significantly more efficient in the short run. Funders may expect a management plan that spells out a hierarchy of communication and responsibility. And, if your organization does not need or want to sustain itself for more than a couple years, then double-loop management may be a wrong decision. But if you are looking to build a virtual organization that has a good chance to be sustained for years or decades through community effort (including downstream fund development) and a small staff, then an initial investment in double-loop governance is key. You will need to sell this to your funders as an investment in sustainability.

From the perspective of the founders, the main risks in implementing double-loop governance comes from the ability of the community to alter the founder’s vision for the organization. Double-loop governance lets everybody steer. This means that the direction travelled will happen through a rough consensus. It also means that the vehicle can move rapidly to another direction once everyone is on board with the new vision.

When decisions are owned by the community, the community will express its own vision. Bacon (2009) has some recommendations for start-up community leadership that can provide some added stability to the initial vision during the boot-strapping period. But the final word will belong to the community. If you are building an organization and cannot let go of your own vision of its future and goals, then build it with a single-loop management, and trust that you have enough charisma to hold it together. Otherwise, offer the vision to your members and give them the tools to make this something they can celebrate.

In terms of cost, the main obstacle to double-loop governance is time. It will take additional months of discussion to arrive at a rough consensus about the governance system documents. (ESIP Federation members worked constantly for more than two years to arrive at their final first draft of a constitution and bylaws.) And it will take additional time for subsequent decisions to be vetted by the community before they can be implemented. Transparent decision making also means giving time for member feedback. Fortunately, much of the business plan implementation efforts can be distributed into subgroups which can be given enough self-governance to streamline their decisions and to accomplish work on specific action points in an agile fashion. This is how major open source software efforts are currently organized.

Staffing a double-loop governed organization requires finding people who have enough patience to stick to the processes that have been decided by the community. They also need to resign themselves to the basic idea that each member is also their boss: all members have the right to comment on the ongoing workings of the organization.  Then again, it’s also the case that members have an obligation to recognize the good work of the staff.

References

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