Groupthink and its Effects on Rational Decision Making at the Level of the Group in Formal Organizations
Authored by: Kedisa Johnson November 7, 2010
Abstract This paper will attempt to outline the effects that groupthink has on rational decision making at the group level within organizations. Employing the definition of both William H. Whyte and Irving Janis’ definition of groupthink, the consequences of groupthink are explored within a historical and modern day context.
William H. Whyte coined the term groupthink in Fortune Magazine in 1952. Whyte (1952) stated that groupthink was more than "mere instinctive conformity — it is, after all, a perennial failing of mankind. What we are talking about is a rationalized conformity — an open, articulate philosophy which holds that group values are not only expedient but right and good as well" (Whyte, 1952). His working definition, however; is not as well known as Irving Janis’s, a Yale psychologist who defined groupthink in a similar context, critiquing conformity at the group level and crediting it for many “faulty decisions” at the organizational level. Janis’s (1972) definition of groupthink echoes Kast and Rosenzweig’s insistence that cohesiveness is “unquestionably the most influential determinant of the group’s behavior as a group” (Harrison, p. 228). Janis (1972) stated that groupthink is "a mode of thinking that people engage in when they are deeply involved in a cohesive in-group, when the members' strivings for unanimity override their motivation to realistically appraise alternative courses of action...Groupthink refers to a deterioration of mental efficiency, reality testing, and moral judgement that results from in-group pressures” (Harrison, p. 230). Examples of groupthink can be found throughout history--from Nazi Germany to the more recent catastrophe of September 11th, to the collapse of Enron Corporation due to the collective consensus of Ken Lay, his management team, and arguably the collective silence of Enron employees. These events were indicative of the moral judgment of individuals being stifled by the “collective” consensus so much that “ethical consequences of decisions” (Harrison, p. 230) were disregarded. Janis (1972) in his research on the effects of groupthink, examined organizational breakdowns in the Kennedy administration--considering how John F. Kennedy could have been misguided by CIA representatives to enter Cuba, just three months after he sworn into office, in a failed attempt to overthrow the government of the Cuban dictator, Fidel Castro ( L a s s i l a , 2 0 0 8 ) . In addition, he examined “the failure to protect Pearl Harbor and the escalation of the Vietnam War” ( L a s s i l a , 2 0 0 8 ) . In each scenario, Janis noted that participants "adhered to group norms and pressures toward uniformity, even when their policy was working badly and
had unintended consequences that disturbed the conscience of the members"( L a s s i l a , 2 0 0 8 ) . Group members that were a part of the decision making process in those critical situations, Janis found, had “failed to consider the full range of alternatives or consult experts who could offer different perspectives”( L a s s i l a ,
2 0 0 8 ) . Considering the full range of
alternatives and enlisting outside assistance is one of the solutions Campbell, Whitehead, and Finkelstein (2009) offer as a way to identify or safeguard against biases in the overall decision making process--individual and group alike (Campbell, Whitehead, & Finkelstein 2009, February). Groupthink can be built within organizational structure. In looking at the demise of WorldCom, it can be argued that “WorldCom's organizational structure, group processes, and culture contributed to the fraud and the length of time over which it occurred...as “there was a great deal of focus on teamwork and being team players” ( S c h a r f f , 2 0 0 5 ) . Morgan (1997) compared the trajectory of WorldCom’s employees to that of Plato cave dwellers, stating that “Plato's cave dwellers, even when faced with a truth that their reality was flawed and only revealed the shadow of reality, would reject that paradigm change to the point of ostracizing the individual attempting to change their reality” ( S c h a r f f , 2 0 0 5 ) . Sharon Allen, chairman of the board at Deloitte, LLP discussed the effects of groupthink in business organizations at the boardroom level in a February 2008 Businessweek article, The Death of Groupthink . She argued that “groupthink may be most dangerous in a corporate sense if it takes root in the boardroom. There, the gravitational pull of conformity can become so strong that directors fail to rise above it by questioning and challenging management” (Allen, 2008). She champions the idea of diversity of thought--”diversity of thought gives needed vitality to corporate debate. Through robust and rigorous examination, diverse boards can help management develop the best approach to any challenge or opportunity. In doing so, such boards elevate the good of the enterprise above the self-interest that can sometimes prevail among like-minded individuals” (Allen, 2008).
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