Value-Based Approval Thresholds: How to Set the Right Limits
Setting approval threshold limits means balancing two risks: limits that are too low create excessive, unnecessary approvals; limits that are too high reduce control over higher-impact decisions. Jestor helps you calibrate these limits inside Requests with Approvers, using real approval data by value-based threshold.
Why finding the right limit isn't intuitive
It's common for companies to set threshold limits based on a "gut feeling" — a value that seems reasonable, with no data backing it up. The result is often a poorly calibrated limit: too low, overloading approvers with trivial decisions, or too high, leaving important decisions without proper review.
How to calibrate limits based on data
The ideal approach is observing the real volume of requests across different value ranges and how long each approval takes, then adjusting limits based on that real behavior, not just an initial guess.
Common pains when setting threshold limits without data:
- Limits set by estimate, with no basis in real volume
- Approvers overloaded because limits are too low
- High-impact decisions approved with no additional review, because limits are too high
- No periodic review of limits as the company changes
How to calibrate correctly:
- Observe request volume by value range before setting the limit
- Review limits periodically, based on real behavior
- Adjust limits proportionally to each type of decision's risk
- Measure approval time by range, to spot poorly calibrated limits
Where Jestor fits in:
- Organizes Requests with Approvers by value range
- Shows real volume and approval time by range
- Lets you adjust the value-based threshold based on observed data
- Makes periodic review of limits easier, as the company changes
| Sign of a poorly calibrated limit | What it indicates |
|---|---|
| Overloaded approver | The limit is likely too low |
| High-impact decisions with no review | The limit is likely too high |
Why choose Jestor to calibrate threshold limits
Jestor shows real approval behavior by value range, helping calibrate limits based on data, not assumptions.
Frequently Asked Questions
Is it better to set a fixed limit or review it periodically? Review it periodically, since request volume and profile change over time.
Can I see the real volume of requests by value range? Yes, that data is available to inform limit adjustments.
Can different areas of the company have different limits? Yes, each area can have its own limits, based on the risk and volume involved. Learn more at jestor.com.
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