Groupthink and Risky Shift Phenomenon

Groupthink phenomenon continues to exist and influence in a group decision making. This is especially happen when group cohesiveness is high and there is an absence of open communication. However, understanding the theory would enable us to recognize the factors that may affect the quality of decisions we made in the group. Risky-shift on the other hand, exists as a form of motivation with a perspective of a shared responsibility of taking the risky decision.

It is generally accepted that this risky-shift influence by cultural value in which individual is motivated to choose the riskier alternative to increase group or society status.

Understanding risky-shift enables us to reduce the magnitude of pressure of which the risk has to bring as imbedded in every decision made during uncertainties. In addition, group interaction is very important in the process of decision-making whereby individual opinion and ideas is valued.

It is also in this way that individual will learn to stand his position in certain decision-making procedure.

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It maybe be difficult and challenging since individual will share different ideas and inputs, exchange opinions and contrary views, yet in the process develop alternatives to the solution in problem solving which reflects a good group decision-making. Overall, these sociological phenomenon and perspective allow us to identify attributes that may control and limit the development of best alternative in solving problem and issues.

Finally, a clear understanding of the elements of these theories will enable members to recognised symptoms within a faulty group decision-making and draw the best alternative course of action from the group.

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This paper is going to provide insights on the case of Yellow Auto Company in term of the critical decision in the sociological perspective area such as the Groupthink and Risky-shift phenomenon. Introduction Group decision-making sometimes falls into the typical group norm which oftentimes leads to failure.

This happens usually because of the idea of group cohesion and valuing the need for belongingness in the group. Janis (1972) defines it as a deliberate action of an individual group member to conform to the decision of the group to keep the harmony. The reason behind is to avoid clashes and come up with a solution without being critical during a group decision-making process. In addition to the need of individual for belonging, group tendency to transfer the risk to group members allow the group to choose the riskier alternative.

It usually, emerges from a faulty organizational structure and communication perspective which oftentimes results a high probability of failure. The Yellow Auto Company was a well-known global car company in India. The company is own and manage by the family where the structure is hierarchical in which line managers and employee has no autonomy in terms of decision making. There is an obvious high cohesion within the members of the decision making body and this is described as unwritten rules of the company which is mostly in the minds of the family members.

When the top managers of the Yellow Auto Company, notice the decreasing job satisfaction and commitment of their employees, they decided to invest on their development. Even though, there was an existing economic crisis in the country, the group decided pursuit with their plans in investing in human resource with the assistance of external consultant. This report will utilize the sociological perspective to critically analyse these significant issue and the make recommendation to an effective group decision-making. The Groupthink phenomenon

The most critical decision that the Yellow Auto Company have done was the decision of hiring and working with external consultant. Since the company was owned and manage by the family, its group structure is assumed to have high group cohesiveness and lack of critical discussion procedures. Janis (1972) exerts that group with high cohesiveness encourages conformity to its norms and without adequate decision procedures which is a condition of groupthink will tend to result to a poor decision (Callaway & Esser, 1984).

In this case the family who runs the company shares common purposes and interests, that gives them a sense of security resulting to a shared illusion of invulnerability (Teale, Dispenza, Flynn, & Currie, 2003a). This is further describe in the case where most of the rules are unwritten and in the minds of the family members which is a characteristic of group conformity (Teale, et al. , 2003a) and where employees did not have much autonomy in decision making.

This conformity of individual to adapt the decision of group members (Gerring, Zimbardo, Campbell, Cumming, & Wilkes, 2012), tends to suppressed individual critical thinking to avoid being ridiculed and being question on their loyalty. The structure of communication process was described as hierarchical where agenda can readily be manipulated and directed by pressure of group conformity which reflects self-censorship (Teale, et al. , 2003a).

The top managers and owner who make the dominant decision for the organization (Teale, Dispenza, Flynn, & Currie, 2003b) may result to a limited quality of the decision as described by Simon as ‘bounded rationality’ (Tolbert & Hall, 2008). As a result of this limitation the group could only identify and provide less alternative course of action to the problem than in groups where participation is encourage (Carrie, 2010). In addition, the absence of critical thinking in group discussion may devoid individual of their potentials to contribute mportant information necessary of the group (Johnson & Johnson, 2009).

In this scenario, the manager may cause other members to follow whatever personal view (Janis, 1972) he may have which is a groupthink perspective characterized by a high level of confidence and lack of disagreement from group members(Callaway & Esser, 1984). However, when the top managers realized the need for experts to manage change process in human resource which reflect task-oriented group (Teale, et al. , 2003a) shows a positive group structure which characterised an effective group decision.

Inviting outside expert is a criterion to prevent the groupthink phenomena, allowing independent group to work on the same problem and assess the organizations. When top managers, line managers and employees decided to work and cooperate with external consultant, it bridges the gap and opens the communication between managers and employees. This communication process, allows members of the group to provides unreserved feedbacks to reduce and unveil the hidden and unknown areas as described in Johari Window as information keep to avoid conflict and concealed potential and unrecognized skills(Teale, et al. 2003a).

In addition it allows group members to contribute in the development of high-quality decision which is a characteristic of consensus perspective (Johnson & Johnson, 2009). The occurrence of open communication between managers and employees display an active cooperation of the group, which is a characteristic for an effective implementation of a decision(Amason, 1996). This intermediate cohesiveness(Callaway & Esser, 1984) produces high quality decision which builds mutual respect, acceptable culture and shared direction in the achievement of organizational goal.

This is a reflection of process-oriented group (Teale, et al. , 2003a) skills where group interaction uses cooperative listening and other social skills to produce a common understanding and getting the job done. Overall, this changes and action of top managers towards their employee builds a mutual commitment for a successful implementation of the decision as described by Guth and Macmillan (Amason, 1996). The Risky-shift phenomenon Most often the group will chose a riskier alternative than decision made by individual (Burnstein, 1969; Stoner, 1968), whereby members of the groups ends to decide differently about perceived risk when they are alone. Some of the many reasons why it might happen include diffusion of responsibility where emotion bonds exist. In this case, the relationship of the family who runs the company, may have the tendency to reduce apprehension and perceived the risk as shared (Wallach, Kogan, & Bem, 1964). Group members would take a risky alternative with the feeling of less personal responsibility for the negative consequences of such a decision(Forsyth, 1990) and less likelihood of being blamed.

It is also a way for individual to easily hide within the group when making contributions to a group discussion and speak only when expected that the group would agree as described by a spiral-of-silence logic (Packer, 2009) whereby individuality is restricted by other people’s opinion. In addition, the top managers and owner of the company cooperation with the external consultant allows the sharing of responsibility to members of the risk which minimizes blaming in case of failure of decision(Clark, 1971).

As a result, the decision will most likely be riskier, as they share the risk and relatively make individual felt risk less. Another probability for the risky-shift to exist is the leadership influence(Clark, 1971) over the group. High risk-taker will persuade others to take greater risks(Collins & Guetzkow, 1964) because of their aggressiveness and commitment in the pursuit of their objective which in this case the top manager and owner. The top managers and owner personal and direct involvement in the company and in the discussion (Forsyth, 1990) will have the tendency to influence the group members.

This is further supported by Brown (1965) who asserts that status in the group is often connected with risk-taking, which oftentimes made the group chose the riskier alternative. In this case scenario, the decision of investing in human resource despite the prevailing financial economic crisis is a perceived risk yet the group chose to proceed with the plan perhaps because of the influence that the owner have over the group. This is further explored by Bateson (1966) who asserts that as individual become familiar with the problem will tend to advocate more risky alternative.

A group interaction will significantly contributes in the amiliarization perspective(Kogan & Wallach, 1967) which allow members of the group to known and be comfortable with risk at hand (Clark, 1971). This group interaction opens the discussion and information exchange towards possible alternative during a risky decision-making. Perhaps the most widely recognized reason of a risky-shift is the cultural value in itself. In the group or in the society situation most individuals choose a riskier decision in order to increase their status in the group. Clark (1971) exerts that diffusion-of-responsibility, leadership influence and familiarization, is dependent upon the relevant content of the risk.

In the case of Yellow Auto Company which the structure management is hierarchical, the top manager and owner have wider scope of activities and concern of the company’s status. Given the current situation of the company in which employee become less committed and unsatisfied in their job, decided to mitigate the issue through investing in human resource development and seek assistance from external consultant. This is probably to ensure that they are relatively blameless in the event of company failure and protect their status as well-know global car company.

The economic crisis will not only entails the company or family societal status but will also cost them particularly on monetary budget allocation and the length of time to implement and evaluate the result and progress as the external consultant do their job. Perhaps the most common action plan during this time of economic crisis is cost cutting or reduction of employee. Another probability would be that the company will try to maximize their internal workforce or perhaps freeze job hiring rather than spending too much on outsourced hiring.

However the group has made this risky-shift as a display of good decision making by their unwavering determination to reach its main aim of customer satisfaction and to achieve its goal to increase share in the market. The attitude of the top managers of being less cautious or less conservative in its orientation towards decision making (Hong, 1978) made it possible for them to reach their the goal. Their participation and cooperation with external consultant is a manifestation of an effective group decision.

This group interaction opens an avenue for change process and ultimately results to the attainment of the desired goal. The acceptance of top managers on working with external consultants reflects criteria of compromise decision making, whereby allowing members of the group to freely discuss and present individual and collective ideas and opinion for the common good of the company. This action creates a positive motivation towards job satisfaction of employee (Nemioff & King, 1975) which is described in the case in the later part where employee shows job satisfaction and organizational commitment.

This is an indication of an effective group decision making whereby members of the group participate in the implementation of the decision (Johnson & Johnson, 2009). Conclusion These are only few of the many sociological phenomenons that influence a group decision making, especially when group cohesiveness is high and there is an absence of open communication. Groupthinks reduce individuality in a group discussion while risky-shift enable individual to conform with the group in order to increase group status.

Understanding these theories would enable the group to recognize the factors that may affect the quality of decisions we made in the group. It also reduces the magnitude of pressure in which the risk has to bring in every decision made during uncertainties. In addition, group communication is very important in the process of decision-making whereby individual is able to express their opinion and ideas. It is also in this way that individual contribution is valued and will learn to stand his position in certain decision-making procedure.

It may be difficult and challenging because of individual different views but the process will develop alternatives in problem solving which reflects a good group decision-making. Overall, understanding these sociological phenomenon and perspective allow us to identify attributes that may control and limit the development of best alternative in solving problem and issues. Recommendation To avoid the pitfall of groupthink and risky-shift sociological perspective it is recommended that:

  1. Each members of the group that is to include the leader or manager should value the presence and idea of each members of the group
  2. Leaders and managers should be sensitive enough to avoid the effects of groupthink by refraining from using their power and influence over the group.
  3. Leaders and managers should refrain from persuading members of the group in their own idea.
  4. Group members should in times take the role of a critical evaluator and this should be allowed by the group to speak his doubts on the decision.
  5. A separate group should be created to work with the same problem.
  6. Finally, a good communication between group members combined with a deeper understanding would bring success and less probability of failure in the decision.

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Groupthink and Risky Shift Phenomenon. (2016, Sep 26). Retrieved from

Groupthink and Risky Shift Phenomenon

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