A friend of mine was asking me how my guild's loot council system works, so I thought I'd write it up for the blog.
We use master looter. When a piece of loot drops, anyone in the raid interested in it for their main spec expresses interest with a link to what they'd be upgrading. Ie, if Origin of Nightmares drops then the feral druid will say "int Staff of the Plaguehound". The loot council (in our case, the officers currently online) then look at who all is interested in the loot and assigns the loot based on what we think is fair. People are allowed to ask for something for off-spec or PvP, too, but they almost always get lower priority than main spec.
Loot Council decisions are final and autocratic. In my guild it'd be unprecedented to publically question a decision, although some private griping happens on occasion. Obviously this system only works if the loot council is fair and believed to be fair. It also helps a lot if your guild members aren't too stressed about loot.
So how do we make decisions fairly? These days, most of the time there's only one person who's interested and so there's no real decision to be made. When multiple people are interested there's a variety of criteria we use. Most of the time it's "last loot"; we try to prioritize loot for people who haven't gotten any in awhile. Occasionally it's "biggest upgrade", particularly for someone who's playing well and making a serious effort to improve. In rare occasions we may decide something's not suited for someone who's inted; yes, the weapon may be an upgrade for the Hunter but because it has expertise it really should go to the rogue. In practice, the results are roughly the same as if we were using an attendance-based system like DKP or Suicide Kings.
I think we do an OK job of being fair. For the months I was just a regular person I really appreciated the freedom from responsibility of having a loot council. I was free to int on anything and everything I wanted and trust the officers would give me only my fair share. Loot seems to come to everyone at a reasonable pace; I'm much more likely to hear someone complain that there are no upgrades for them than that they aren't getting the upgrade they want.
The main problem with our system is the discussion can be slow, particularly when a trinket or ring drops that every single physical DPS class wants. It can take 5+ minutes to make a decision, holding up at least one person to assign loot. It's also a bit awkward when loot council members are competing with other raiders, although we do make extra effort to be fair in those circumstances. And the personal nature of the decision process can occasionally result in hurt feelings, although fortunately our guild is full of people with remarkably mature understanding of loot decisions. Mostly it works OK, it's just a headache for the officers.
In my mind loot is more of a problem than a reward. Getting an extra +10 agility doesn't really make the game more fun for me; pulling the next mob does. If it were up to me I'd run loot entirely on rolls. There's a need/greed loot box for a reason, just use it. It's the fastest, simplest, most transparent way. The biggest problem with random rolls is some people may roll inappropriately and there's a big grey area where folks are socially pressured to pass on one roll because "someone else needs it more". Loot council removes that problem and saves some drama.