Why Decision-Rights Tools Fail and How to Fix Them

Decision-making frameworks look clean on paper. Assign ownership, set boundaries, let the person closest to the information decide. In practice, those tools break down when the environment shifts faster than the rules can adapt.

Gretchen Gavett, managing editor of HBR's The Insider, wrote this week about why decision-rights tools so often fail. The root cause is rarely the tool itself. It is the assumption that the same structure works across a changing set of circumstances. A framework designed for stable markets can lock in rigidity during volatility.

Gavett also highlighted a recent piece by Columbia's Rita McGrath on "strategic centering." McGrath argues that when traditional anchors – market share, historical multiples, sector benchmarks – stop being reliable, leaders need a different way to set direction. Strategic centering means picking a constant that does not change with the cycle, then aligning every decision around it.

For traders, the parallel is clear. A position-sizing rule that worked in low-volatility regimes may fail when gamma flips. A stop-loss anchored on a fixed technical level ignores a regime change in correlation. The fix is not to abandon frameworks. It is to build in a mechanism that tests whether the anchor still holds.

Gavett also invited readers to share experiences managing AI agents in the latest Insider Insights survey. The question of how to delegate decision rights to autonomous systems is becoming a practical one, not just a theoretical debate.