Groupthink

What is Groupthink?

Groupthink is a term developed by social psychologist Irving Janis in 1972 to describe suboptimal decisions made by a group due to group social pressures. It is a phenomenon in which the ways of approaching problems or matters are dealt with by the consensus of a group rather than by individuals acting independently. Essentially, groupthink occurs when a group makes faulty or ineffective decisions just to reach an agreement.

Example of Groupthink

Let us consider an example in a business setting.

There are four mutual fund managers – Jeffery, John, Jack, and Jane – who are in charge of a mutual fund for Company A. The four fund managers meet bi-weekly to discuss investing strategies and their top picks of the week. In addition, each of the four individuals trusts each other’s judgment.

During one of their bi-weekly meetings, Jeffery announces that he plans to make a significant buy of shares of a company, as he thinks the company shows strong fundamentals. The other fund managers, John, Jack, and Jane, decide to go along with the plan and buy shares for their mutual funds without doing individual research on the company in question. A couple of weeks later, shares of the company dropped by 80%.

In the example above, the fund managers became victims of groupthink as they followed the group’s consensus rather than independently analysing the company proposed by Jeffery. Therefore, the fund managers failed to point out or critique the flaws in Jeffrey’s thinking.

Symptoms of Groupthink

Irving Janis described the eight symptoms of groupthink:

1. Invulnerability

Members of the group share an illusion of invulnerability that creates excessive optimism and encourages taking abnormal risks.

2. Rationale

Victims of this behaviour ignore and discount warnings and negative feedback that may cause the group to reconsider their previous assumptions.

3. Morality

Victims ignore the ethical or moral consequences of their decisions and believe unquestionably in the morality of their in-group.

4. Stereotypes

Members of the group possess negative and/or stereotypical views of their “enemies”.

5. Pressure

Victims apply direct pressure on any individual who momentarily expresses concern or doubt about the group’s shared views. Members are not able to express their arguments against the group.

6. Self-censorship

Victims avoid deviating from what the group consensus is and keep quiet. Doubts and concerns about the group are not expressed, and victims of groupthink may undermine the importance or validity of their doubts.

7. Illusion of Unanimity

Victims of groupthink share an illusion of unanimity – that the majority view and judgments of the group are unanimous.

8. Mind Guards

Victims of groupthink may appoint themselves to protect the group and the group leader from information that may be problematic or contradictory to the group’s views, decisions, or cohesiveness.

The Impact of Groupthink

Groupthink, in essence, values harmony and coherence over accurate analysis and critical thinking of individual members. It creates a group where individual group members are unable to express their thoughts and concern and unquestioningly follow the leader’s word. For example, think of a corporate meeting where the board members just nod in agreement instead of challenging the ideas proposed.

Therefore, the impact of groupthink includes the following:

• Bad decisions due to lack of opposition
• Lack of creativity
• Overconfidence in groupthink negatively impacts the profitability of an organisation
• Optimal solutions to problems may be overlooked
• Lack of feedback on decisions and hence poor decision-making

Real-world Example

The following example demonstrates how destructive groupthink is by accepting the ideas of a group without critically questioning it.

The attack on Pearl Harbor is an excellent example of groupthink. Despite the interception of Japanese messages, US naval officers based in Hawaii did not seriously take warnings from Washington about a potential offensive attack somewhere in the Pacific Ocean. The officers thought that the Japanese would not dare to attack the US. Nobody challenged the idea and instead rationalised why an attack was unlikely to happen.