As discussed in the past few columns, leadership is a multifaceted concept that involves guiding a group or organisation toward its goals. While effective leadership is crucial for success, there are certain leadership mistakes that can have detrimental consequences. I have discussed a couple of them in the past. Yet another leadership mistake is encouraging groupthink.
Groupthink is a phenomenon where individuals within a group vie for consensus and harmony over critical thinking and independent analysis. In this column, I will discuss the dangers of encouraging groupthink in leadership.
The term Groupthink was coined by Irving Janis in the 1970s and is characterised by several key components: the illusion of invulnerability, collective rationalisation, self-censorship, and the belief in the inherent morality of the group.
When groupthink takes hold in an organisation, it can lead to poor decision-making, stifled innovation, and a lack of accountability — what we see in politics and governance today.
Encouraging groupthink will lead to several consequences. One of the most significant is poor decision-making. When a leader allows an environment where dissenting opinions are discouraged, it will result in a lack of critical evaluation of ideas and alternatives. Group members may conform to the dominant viewpoint, resulting in decisions that are not thoroughly thought out. This can lead to misguided plans and ultimately harm the organisation's success.
A tragic case in point is the Challenger Space Shuttle disaster in 1986. NASA engineers were under pressure to launch the shuttle, despite concerns about the vulnerability of components known as O-rings to cold temperatures. Engineers who had reservations did not speak up, fearing a lack of consensus. This is the danger of stifling dissenting voices in decision-making on sensitive projects.
Stifling innovation is the next. Innovation is the lifeblood of progress in any enterprise. Groupthink stifles creativity and innovation by promoting conformity and discouraging new and unconventional ideas. When everyone in a group agrees and avoids challenging the status quo, the organisation may miss out on groundbreaking innovations and opportunities for growth.
Kodak, a company that once dominated the photography industry, is a classic example of how groupthink leads to missed opportunities. Kodak ignored the potential of digital photography due to an overemphasis on their photo film business. This led to its bankruptcy, as digital photography became the new norm.
Third is lack of accountability. Encouraging groupthink leads to a lack of individual accountability. When group members conform to the consensus without independent analysis, it becomes challenging to attribute decisions or actions to specific individuals.
Many SMEs find themselves in this mess due to a diffusion of responsibility within the organisation.
The 2008 US financial crisis saw various financial institutions engage in risky behaviour that contributed to the global economic meltdown. Groupthink played a significant role as top leaders and employees followed the herd, believing that their actions were acceptable because "everyone else was doing it."
The resultant culture of conformity and insularity within an organisation can be disastrous. When individuals are discouraged from questioning prevailing beliefs, it can create an environment where dissent is seen as disloyalty.
Over time, this can lead to a dysfunctional organisation that is resistant to change and unable to adapt to new challenges.
The collapse of Enron in 2001 is a poignant example. The company's leadership encouraged a culture of unwavering loyalty, stifling any criticism or dissent. This ultimately led to fraudulent financial practices and the downfall of a once-prominent corporation.
Overcoming the mistake of encouraging groupthink and promoting a culture of critical thinking and diversity of ideas is crucial for effective leadership.
Here are some pointers for SME leaders who want to emulate great leadership skills:
>> Encourage employees to voice their opinions even if different from the prevailing consensus. Allow constructive criticism as a norm, Seek disconfirmation bias from the lowest level.
>> Bring diversity into teams with culture, background, education and other possible factors.
>> Appoint a “devil’s advocate” in every critical meeting by identifying a team member to challenge prevailing assumptions.
>> Encourage independent analysis by getting employees to conduct independent research before approving or otherwise.
>>Implement structured decision-making processes such as SWOT analysis, PESTEL, a BCG matrix, etc to make objective decisions.
>> Promote open communication across the enterprise so that it is easier for employees to give feedback.
>>Rotate leadership roles regularly within teams. This prevents dominance in decision-making as well as nepotism.
>> Consider using tech tools to bring in anonymity for ideas and feedback. This will allow people to raise dissenting voices without fear of retaliation.
>> Seek external consultants to gain outside perspectives as they can provide valuable insights and challenge internal assumptions.
>> Celebrate critical thinking by recognising and rewarding employees for valuable contributions.
>> Reflect on past mistakes and encourage people to learn from them.
>> Monitor group dynamics in meetings and be alert to signs of groupthink such as conformity, self-censorship, etc.
By adopting these practices and working to prevent groupthink, SMEs can make more informed decisions, drive innovation, and maintain a healthy culture.
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