Consensus Decision-Making Pros and Cons

Consider These Significant Issues Before You Make Consensus Decisions

Group of 5 employees talking in a circle to come up with a consensus decision
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Consensus decision-making sounds like a way to achieve the best possible outcome from the decisions made at work. If you can bring all team members on board, you’ll have developed a decision that everyone likes, respects, and supports.

That’s the theory—but it often falls flat. While all team members “agree” to support the consensus decision, the decision may not, in fact, be the optimal decision for the team or the business.

Group Agrees to Support the Decision

Reaching a conclusion that everyone on the team supports is a positive, often effective, team strategy. With 100 percent agreement, you can move forward with confidence, and you don’t have to worry about another employee working to undermine your efforts.

Involved Employees See a Benefits

To get everyone to agree, it generally (but not always) means that the decision made will benefit every group within the team or organization. You’re not sacrificing good HR, for example, to make finance happy, or vice versa.

You Present a Unified Front

Leadership teams often have to make decisions that employees don’t like or support. That’s part of leadership. You will find it’s far easier to convince employees who may not like the decision when they receive a consistent message from their managers and senior leaders.

Collaborative Spirit of the Team

When you come to a group consensus, your climate for employees feels quite cooperative. Everyone’s ideas were heard, and you came to a decision that all team members could support. This interactive process can bring about feelings of goodwill.

Agreeing to Bad Decisions

As a business writer for the weekly magazine "Inc.com", Erik Sherman remarked, “Individuals can generate bad ideas, but it takes a committee for a real disaster." He connects this thought to a 2018 event that appeared on news headlines across the nation.

In the event, a group of 14 Idaho Middleton School District elementary teachers dressed in culturally insensitive Halloween costumes after attending a week-long team-building event meant to foster mutual respect and kindness. Several members of the group dressed in ponchos and sombreros while another group dressed in large cardboard sandwich boards designed to look like a wall bearing the words, "Make America Great Again", according to a USA Today report. The costumes were designed and created during the team-building event.

As can be imagined, the event upset many parents and children of the district. The implicated teachers were placed on paid administrative leave and the school's principal was replaced.

Groupthink Is Real

The above Halloween disaster is an example of Groupthink—the desire to reach a consensus can cause people to ignore indications that what is proposed is a bad idea. The team pushes aside any data that may derail the consensus decision.

Research psychologist and author Irving Janis first described the theory of Groupthink. He offers the eight steps involved in creating the systematic errors of Groupthink.

  1. Illusions of invulnerability lead members of the group to be overly optimistic and engage in risk-taking.
  2. Unquestioned beliefs lead members to ignore possible moral problems and ignore the consequences of individual and group actions.
  3. Rationalizing prevents members from reconsidering their beliefs and causes them to ignore warning signs.
  4. Stereotyping leads members of the in-group to ignore or even demonize out-group members who may oppose or challenge the group's ideas.
  5. Self-censorship causes people who might have doubts to hide their fears or misgivings.
  6. "Mindguards" act as self-appointed censors to hide problematic information from the group.
  7. Illusions of unanimity lead members to believe that everyone is in agreement and feels the same way.
  8. Direct pressure to conform is often placed on members who pose questions, and those who question the group are often seen as disloyal or traitorous.

Compromise Solutions

Nobel Prize winner John Nash, Jr. developed the concept that is now called the “Nash equilibrium.” This is a situation in which you can’t make any more changes without making a particular team member better off. The decision may not be the best solution, but it’s the most “fair” option.

However, by its very nature, it’s not the best possible outcome for any one person or group. Consensus decision-making can cause a group to agree to the lowest common denominator—a solution or decision that satisfies the team members' need to agree—but is definitely not optimal for the business.

Additionally, in business, not every factor, department, person or decision in an organization is equally important. For instance, the HR department may push for no layoffs. This sounds great and is what you'd expect from your HR team. But, by not cutting labor costs, you have to cut costs in another area.

The consensus decision is to cut manufacturing costs and not do employee layoffs, but the result is a shoddy product that eventually causes the company to lose market share. Ultimately, all the employees are worse off. Perhaps the disaster could have been avoided by not treating every department or concern as of equal worth.

Business Is Hierarchical

Sure, organizations such as Zappos run on this “holacracy” theory, in which the hierarchy is very flat, but even then you only see CEO Tony Hsieh speaking to the press, and not John in customer service. Regardless of what your formal structure looks like, some people have power and other people do not have power.

If your goal is consensus decision-making, this power differential allows the powerful to heavily influence the less powerful to reach “consensus.” Then, if the decision made is a failure, the powerful can point out that “everyone agreed to this solution.” In other words, the aura of consensus decision-making allows the powerful to avoid responsibility.

Making the Best Decision

Overall, in business, a complete and total consensus isn’t necessary. You can reach decisions, and the entire senior team can promote the message, without requiring every employee to be happy with the decision. Leadership involves risk-taking, and sometimes that means taking action or providing direction that not all employees love.