In business, teamwork and unity are good things, right?
Yes and no. Of course it’s good for employees to get along and to collaborate, but if that cooperation goes too far, it can lead to a serious problem: groupthink. Teams suffering from groupthink tend to make worse decisions and overlook potential pitfalls, which can have disastrous consequences for a business.
In this tutorial, you’ll learn what groupthink is and why it’s a problem in business. Then you’ll learn how to identify groupthink and how to avoid it in your teams. We'll also discuss some real-life groupthink examples.
1. What Is Groupthink?
To start off, let’s define groupthink. The term originated in psychology. It was coined by psychologist Irving Janis in a seminal 1971 paper on the role of group decision-making in historic U.S. foreign policy blunders. He found that such decision-making wasn't always effective, largely because people prioritized conformity over rational thinking. They thought not as individuals, but as a group.
Here’s a simple definition of groupthink from Psychology Today:
“Groupthink occurs when a group of well-intentioned people make irrational or non-optimal decisions that are spurred by the urge to conform or the discouragement of dissent.”
When a team is operating in groupthink mode, it'll shut down debate or alternative viewpoints. It'll be committed to a certain point of view and will dismiss warning signs or contradictory data. It may score highly for things like team spirit and group identity, which are usually positive things, but it'll not be a healthy decision-making environment.
Groupthink can cause problems such as:
- bad decisions
- exclusion of outsiders/dissenters
- lack of creativity
- blindness to potential problems
- resistance to new ideas
- excessive deference to authority
- believing only the facts that support existing opinions
We’ll look at these issues in more detail, especially in a business context, in the next section.
2. Why Is Groupthink a Problem in Business?
If you want to be successful in business, you need to make good decisions. Groupthink can prevent that by stifling debate.
For example, imagine that you’re launching a new company website. As the head of the firm, you’ve designed the site yourself, and all your employees tell you that it looks fantastic and praise your creativity. One person who’s new to the team raises some concerns, but they're quickly shut down by the others.
So, excited about this new site, you go ahead and launch it, and guess what? Your customers hate it. There are obvious problems that nobody brought up, like a malfunctioning shopping cart and a lack of contact details. And the design looks so amateur that several popular sites feature it as an example of how not to design a website. The jokers on Twitter have a field day, and your company’s reputation takes a beating.
This scenario exemplifies many of the groupthink problems we looked at in the first section. Your employees showed excessive deference to you as the head of the company. They didn’t want to offend you by telling you the website was terrible, or perhaps they were scared of what would happen if they were honest. They shut down the lone voice of dissent and were resistant to any new ideas that the person was trying to introduce. The result was that you were blind to a huge looming problem (the bad website) and lost both money and reputation.
You can take steps to prevent groupthink if you understand the question: how does groupthink work? To illustrate these problems further, let’s look at a real-life example of groupthink in action.
A Groupthink Case Study: Enron
When energy giant Enron collapsed in 2001, many people were shocked—including people on its own board of directors, who should've seen the warning signs and anticipated what was coming.
Law professor Marleen A. O’Connor shows in a detailed study of the Enron debacle that groupthink was a key factor in the company’s downfall. For years, the company had been skirting its own ethics code and using transactions with so-called “related-party partnerships” to inflate its earnings by billions of dollars. And the company’s board of directors, a group of experienced businesspeople who should've seen the warning signs, somehow didn’t realize what was happening until it was too late. In fact, they approved several waivers to the company’s ethics code that allowed the crisis to escalate.
Prof. O’Connor analyzes the board’s deliberations in her paper and concludes that groupthink psychology took hold. For years, the company was incredibly successful, and nobody wanted to jeopardize that by creating conflict and asking difficult questions—the questions that could've averted catastrophe.
It wasn’t just the board that was at fault either. The paper also points to:
“... lack of diligence by other corporate gatekeepers such as analysts, auditors, outside counsel, institutional investors, credit rating agencies, journalists, investment bankers, and regulators.”
In other words, there were many people who could or should've spotted the problems at Enron sooner, but nobody did. Groupthink was a powerful factor in that collective blindness. Similar phenomena have occurred in the buildup to various financial crises, with people conforming to the group narrative and creating speculative bubbles based on “irrational exuberance.”
There are also much older parallels, such as the folktale of the Emperor’s New Clothes, in which only a small boy has the honesty and courage to break the groupthink psychology and point out that the emperor’s clothes don’t exist.
3. How to Identify Groupthink
So how do you recognize the symptoms of groupthink in your team? What causes groupthink, and how do you identify it? Here are some warning signs to watch out for.
We’ll look at the original eight symptoms of groupthink identified by psychologist Irving Janis in his 1971 paper. But whereas his paper was to do with governmental decision-makers, we’ll look at these groupthink symptoms in a business context.
Illusion of Invulnerability
When groupthink takes hold, you think the normal rules don’t apply. Things that would be a bad idea for most companies (e.g. suspending ethics rules) will work for you because your company is special. Or maybe you think the rules have changed because of the cool new technology that you use, and the naysayers are old-economy dinosaurs who “just don’t get it.”
Because your group is invulnerable, any facts or data indicating that you’ve made a mistake must be wrong. If someone in the accounts department raises red flags about holes in the balance sheet, a team operating under groupthink will create collective rationalizations to explain it—that person made a mistake, or they've got an agenda to undermine the group, or they’re maliciously spreading false information.
Belief in the Morality of the In-Group
In groupthink theory, morality is important. People generally don’t make bad decisions and suppress opposition because they’re evil or they've got bad intentions. On the contrary, in a groupthink scenario, they believe strongly that they're good people doing the right thing. That sense of rightness helps them to justify doing things like bending the rules or acting unethically. Essentially, they believe that the end justifies the means.
Negative Stereotypes of the Out-Group
In Janis’s original paper, the “out-group” referred to the U.S.’s enemies at the time, like Cuba and the USSR. Viewing their enemies in simplistic, stereotypical ways helped to foster group identity and an “us vs. them” mentality, but it also led to ineffective decisions based on false assumptions. This can also apply in a business context—if you find people demonizing your competitors or even rival groups within your company, then groupthink may be taking hold.
Direct Pressure on Dissenters
A key element of groupthink theory is the suppression of dissent. The group is so committed to its own rightness and goodness that people who raise threatening questions are put under intense pressure to stop. In a business context, this can be very powerful—employees depend on their job to pay their bills and support their families, so if they get told to stop causing trouble, they’ll quickly learn to toe the line, and groupthink will take an even firmer hold.
In an environment in which alternative opinions are treated as “bad news” and the bringers of that news are punished, the next obvious stage is self-censorship. That’s what happened in our website example above. People knew from prior experience that criticism of the website wouldn't be welcome, so they kept quiet.
Illusion of Unanimity
When people in the group are engaged in self-censorship, a false sense of unanimity develops. In the “Emperor’s New Clothes” tale, everyone is secretly thinking the emperor has no clothes. But because nobody says it out loud, there seems to be a unanimous opinion that the emperor’s clothes are fine and elegant. That puts even more pressure on people to stay quiet to avoid looking foolish.
Janis used the chilling term “mindguards” to describe people within the group who take it upon themselves to protect other members from threatening or contradictory information. For example, when presenting an update on company performance, a mindguard will remove any charts showing missed targets and leave in only the ones that surge impressively upwards. But the information on missed targets would probably have been more useful to the team to help them identify potential problems and find effective solutions.
4. How to Prevent Groupthink in Your Team
If some of the symptoms above sound familiar, then you may have a groupthink problem in your team. In this section, we’ll look at how to avoid groupthink, and how to counteract it if it’s started to take hold.
Assign a Devil’s Advocate
One of the simplest ways to avoid groupthink is to assign the role of “devil’s advocate” to a team member in every meeting. That person’s role is to question the group’s consensus by coming up with as many objections and counter-arguments as they can think of.
Because the person has been specifically told to play this role, they won’t feel inhibited about voicing criticisms. Some of the points they raise may force the group to change its view or at least to think more carefully about it.
Have the Leader Speak Last
Often, in groupthink situations, team members rush to agree with the group’s leader or its dominant members. If this is happening in your group, consider asking those dominant people to keep quiet until others have had their say.
For example, if you’re holding a meeting to decide between two new logo designs, the usual groupthink model may be that you express a liking for Logo A and then everyone else agrees with you. So if you want a more genuine discussion, don’t express your opinion immediately. Introduce the two options without judgment, and ask some of the quieter or more junior members of the team to give their feedback first.
Having outside experts at your meetings can help to break up the group mentality and introduce other opinions and perspectives. If the outsiders are respected experts in the field, group members aren’t so likely to challenge them, and they may even hold a more open debate than usual because they want to make a good impression on the outsiders.
Once groupthink has taken hold, it can be difficult to get rid of it. One thing you can do is make public statements of appreciation for people who bring what may be considered “bad news.”
For example, if someone tells you that your team's new product has a major flaw that'll delay the launch, publicly thank them for bringing that news to light before the flawed product went public. By doing this, you're signaling to everyone in the team that you won’t “shoot the messenger,” and you're encouraging people to be honest about important issues even if they threaten the group consensus.
Have Greater Diversity
Diversity can be a powerful antidote to groupthink. When people are all from similar backgrounds and have similar experiences and expectations, it’s more likely for groupthink to take hold. As we’ve discovered throughout our series on workplace diversity, bringing in people with different experiences and perspectives can shake things up and lead to better outcomes.
For example, as we discovered in the article on the key advantages of promoting diversity in your business, research has found that diverse groups make better decisions:
"The mere presence of diversity in a group creates awkwardness, and the need to diffuse this tension leads to better group problem solving.”
What this means is that you can help to avoid groupthink by creating more diverse teams. You can embed diversity considerations in your hiring practices, and you can also make a conscious effort to mix up the groups within the company so that each individual team has more diversity.
To learn more, read the following tutorials:
- DiversityHow to Build a Culture of Diversity and Inclusion in Your WorkplaceAndrew Blackman
- DiversityHow to Ensure Diversity in Your Recruiting and Hiring PracticesAndrew Blackman
- DiversityHow to Achieve Gender Equality in Your BusinessAndrew Blackman
You've just discovered the answer to the question: what is groupthink? We've also explored some real-life groupthink examples.
As we’ve seen, groupthink can be disastrous for your business. It can lead to poor decision-making and a lack of honest debate and dialog. Even if your business doesn’t collapse as spectacularly as Enron, groupthink can cause real, tangible problems such as lost revenue, alienated customers, and poorly designed products. And it can create a toxic working environment for your employees, which means lower productivity and higher staff turnover.
But fortunately, there are things you can do. We also looked at how to avoid groupthink by using several strategies such as assigning someone in the group to play devil’s advocate, having the leader speak last, and increasing the diversity in your teams.
If you found this article useful, why not try reading some of our other management tutorials?