Horizontal and vertical escalations

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A horizontal escalation is one that crosses between silos within an organisation.

So, when a negotiator (Operations) has to get a credit point approved by a credit officer (Credit), or a legal point approved by the legal eagles (Office of the General Counsel), she must transgress her own hermeneutical boundaries and seek the say-so of someone subject to the laws and imperatives of a different realm whose ultimate control may not be common with her own until it is a long way further up the organisation: possibly not until the CEO himself (or — likely story, but still — herself).

To be contrasted, obviously enough, with a vertical escalation, where one seeks the approval, judgment, sign-off or general air-cover of one’s own line manager, and she might seek a validating judgment from hers.

Vertical escalations respect the formal order of the organisation, and are generally efficient: escalator and escalatee have the same basic set of competencies and theory of the game.

Generally your own line manager is readily available for you to speak to, interested in your problems and dispositionally inclined to give the guidance you need — that is, primarily, what she is there for — so unless you are uncommonly odious or doltish, you will have a sound grasp of the details of the issue, a fair opinion about what the correct judgment should be, and a good enough relationship to present the case in a way that generates a sensible, fast, and un-laboured outcome.

Thus — and recognising that this is theory, not practice, and organisations are generally run far less competently than you might possibly believe — vertical escalations are generally efficient, effective, and fast.

This we can sharply contrast with horizontal ones.

In a horizontal escalation, the parties will usually have opposed interests: the negotiator will want the credit officer to accept some risk, and the credit officer won’t want to. Nor will the credit officer be inclined to take the negotiator’s word for anything, believing her to be under the pernicious influence of sales, or at least imperfectly aligned with the credit officer’s sacred oath to banish all conceivable risk. And, where the inevitable meatware juniorisation has gone on, nor will the credit officer really understand the issue, let alone have any mandate to sign it off. She will have to launch her own vertical escalation to get to the bottom of it, but as this is not really her issue, but some doc jockey’s from the operations team, when she eventually gets round to pursuing it she will do so unenthusiastically.

This whole process occupies time, screen real-estate, and cost. It is not really resolvable by training, because interests are not correctly aligned, and in any case the whole point of juniorisation is to get rid of trained people — subject matter experts — and have the process carried out by ingénues and, ultimately, chatbots.

It can be resolved by other methods of process and system realignment, however. If your organisation is daring, bold, and has the resources and patience to withstand the disruption, you could introduce a charging model to disincentivise unnecessary horizontal escalation. This is more often talked about than it is seen, however. An easier route is to encourage maximal vertical escalation before any horizontal escalation is allowed, by blocking very junior team members from making horizontal escalations in the first place. This — an escalation threshold — works for ad hoc escalations, but not for structurally necessary ones, such as you might see in an industrial grade master contract negotiation operation.

See also

• Waste
• Escalation
• Escalation threshold
• Silo
• Fourth law of worker entropy