The problem? Most companies choose R2. They don’t hire people for their ability to apply judgment, they hire people for their ability to follow rules. This fundamental choice shapes everything about how your organization handles complexity—and complexity is everywhere in modern software development.

The Two Approaches to Complexity

When facing complex systems, organizations typically choose between two approaches:

R1: Judgment-Based Approach

  • Hire intelligent people
  • Give them context and principles
  • Trust them to make good decisions
  • Learn from outcomes and adjust

R2: Rules-Based Approach

  • Create detailed processes and procedures
  • Hire people to follow the rules
  • Monitor compliance and adherence
  • Blame individuals when rules don’t work

Why R2 Feels Safer (But Isn’t)

Rules-based approaches appeal to managers because they create an illusion of control and predictability. If everyone follows the rules, the thinking goes, we’ll get consistent results.

The Comfort of False Certainty

Rules provide:

  • Measurable compliance: You can track whether people follow procedures
  • Accountability: When things go wrong, you can identify who broke the rules
  • Scalability: New hires just need to learn the rulebook
  • Legal protection: “We followed the process” is a defensible position

The Hidden Costs

But rules-based approaches fail when dealing with genuine complexity because:

  • Rules lag reality: By the time you write the rule, the situation has changed
  • Rules interact unpredictably: Following rule A might violate rule B in edge cases
  • Rules stifle adaptation: People stop thinking when they have rules to follow
  • Rules multiply: Every exception requires a new rule, creating bureaucratic bloat

Why R1 Works Better (But Requires Courage)

Judgment-based approaches work better with complexity because they adapt in real-time to changing conditions.

The Power of Contextual Intelligence

When you hire for judgment, you get:

  • Faster adaptation: People can respond to new situations immediately
  • Better outcomes: Intelligent people often find solutions you didn’t anticipate
  • Reduced overhead: Less time spent on process compliance and rule maintenance
  • Innovation: People solve problems in novel ways

The Requirements

But judgment-based approaches require:

  • Better hiring: You need people who can actually exercise good judgment
  • Clear principles: People need to understand what you’re trying to achieve
  • Psychological safety: People must feel safe making decisions
  • Learning systems: You need feedback loops to improve judgment over time

Real-World Examples

Software Development

Rules Approach: Detailed coding standards, mandatory code reviews, strict deployment procedures Judgment Approach: Clear architectural principles, pair programming, continuous integration with rollback capability

Result: Rules create compliance theater while judgment creates working software

Incident Response

Rules Approach: Detailed runbooks, escalation matrices, blame-free post-mortems (but only if you followed the runbook) Judgment Approach: Train people to diagnose systems, give them authority to act, learn from all outcomes

Result: Rules create slow response to novel problems while judgment creates rapid adaptation

Product Development

Rules Approach: Detailed requirements, change control processes, milestone gates Judgment Approach: Clear product vision, cross-functional teams, rapid experimentation

Result: Rules create products nobody wants while judgment creates products that solve real problems

The Meta-Problem

The irony is that most organizations default to R2 (rules) precisely because they don’t trust people’s judgment—including their own. But this creates a self-fulfilling prophecy:

  1. You hire rule-followers instead of independent thinkers
  2. You create systems that reward compliance over outcomes
  3. You atrophy the judgment muscle of your organization
  4. You prove that people can’t be trusted with judgment
  5. You double down on rules

Breaking the Cycle

To move from rules to judgment:

1. Start Small

  • Identify low-risk areas where judgment can replace rules
  • Run experiments and measure outcomes
  • Learn what kind of judgment your organization needs

2. Hire Differently

  • Test for judgment during interviews, not just technical skills
  • Ask candidates to solve ambiguous problems
  • Look for people who question rules constructively

3. Create Learning Systems

  • Regular retrospectives on decision quality
  • Blameless analysis of both good and bad judgment calls
  • Continuous refinement of principles based on learning

4. Support with Context

  • Clear vision and principles that guide judgment
  • Access to information needed for good decisions
  • Regular communication about changing context

The Judgment Paradox

Here’s the paradox: To build a judgment-based organization, you need people with good judgment to design it. If you’re currently rules-based, you may have selected against the very people you need to make the transition.

Solutions:

  • Bring in fresh perspective through new hires or consultants
  • Identify existing people who’ve been constrained by rules but have good judgment
  • Start with leaders who can model judgment-based decision making

When Rules Make Sense

Rules aren’t always wrong. Use rules when:

  • Safety is paramount and the cost of error is catastrophic
  • Legal compliance is required and non-negotiable
  • The problem is well-understood and the solution is proven
  • You’re dealing with genuinely routine tasks

But even then, people with good judgment will know when to break rules intelligently.

The Path Forward

The choice between judgment and rules isn’t just about management philosophy—it’s about what kind of organization you want to be:

Rules-based organizations optimize for consistency and compliance but struggle with adaptation and innovation.

Judgment-based organizations optimize for outcomes and learning but require higher trust and better people.

In a world of increasing complexity and accelerating change, the choice is clear. You can’t rule your way to success in complex systems. You need people who can think, adapt, and exercise good judgment.

The question isn’t whether your people are capable of judgment—it’s whether your systems allow and encourage it. Start there, and the judgment will follow.