Majoritarian departmental politics and the professional. Effects of groupthink on tactical decisionmaking dtic. Groupthink occurs when a homogenous highly cohesive group is so concerned with maintaining unanimity that they fail to evaluate all their alternatives and options. This relation establishes the link of postmerger performance improvements towards shareholder value creation. Groupthink members see themselves as part of an ingroup working against an outgroup opposed to their goals.
In a groupthink situation, each member of the group attempts to conform his or her opinions to what they believe to be the consensus of the group. The boxes on the left lay out the preconditions for a concurrenceseeking tendency to. Pdf the effects of group cohesiveness and leader behavior on janis 1982 symptoms of defective decision making were investigated within a laboratory. Toward the creation of constructive thought patterns in selfmanaging work teams human relations, 47 1994, pp. Janis 1971,1972,1982,1989 suggested methods to prevent or minimize the supposedly dysfunctional consequences of groupthink, including the following. In this spirit, we introduce a fourth method, the gdqs, an effort to combine. Profitability analysis of mergers and acquisitions. Evidence finds that the importance of various motivations for mergers and acquisitions changes over time. Evaluating janis groupthink model of faulty decision making. Groupthink principles and fundamentals in organizations journal.
Groupthink according to irving janis 1982 is a deterioration of mental efficiency, reality testing, and moral judgment, that results from ingroup pressure all academic inc. It is concluded that post merger performance improvements prove the existence of merger induced synergy. Group decision making principles of social psychology 1st. Operating synergy types and their impact on postmerger. According to irving janis 1982 groupthink is likely to occur. Evaluating janis groupthink model of faulty decision making in groups ps2030 social psychology word count. In studies of social clubs and other small groups, conformity pressures have frequently been observed. There have been three merger waves in the 1960s with the multinational takeovers, in the. Guarding against groupthink in the professional work.
Majoritarian departmental politics and the professional pyramid. You can tell if a group suffers from groupthink if it. Irving lester janis developed a study on decision making based on human social behavior in which maintaining group cohesiveness and solidarity is felt more important than considering the facts in a realistic manner. I use the term groupthink as a quick and easy way to refer to the mode of thinking that persons engage in when concurrenceseeking becomes so dominant in a cohesive ingroup that it tends to override realistic appraisal of alternative courses in action.
The term groupthink was coined by irving janis moorhead et al. Kendra cherry, ms, is an author, educational consultant, and speaker focused on helping students learn about psychology. The articles opening quote from barry diller shows that the term is still used in the same way today. Articles warning of the dangers of groupthink and suggesting remedies appeared in management, psychology, and sociology periodicals. Group wants to achieve so bad they overlook possible alternatives. Apr 18, 2020 kendra cherry, ms, is an author, educational consultant, and speaker focused on helping students learn about psychology. Every day in organizations, groups meet to make decisions. Janis that refers to a psychological phenomenon in which people strive for consensus within a group. Two reference cycle expansions, unaccompanied by a strong upswing in stock prices, were marked by. Janis, 1982, houghton mifflin edition, in english 2nd ed.
Groupthink principles and fundamentals in organizations. The group is insulted from information coming from outside the group. According to the wikipedia entry on groupthink, it wasnt orwell, but rather william h. Two heads are better than one is a common misconception people have that group discussions and decisions are better than working individually.
Overestimation of the group illusion of invulnerability belief in inherent morality of the group type ii. This paper advances an explanation for decision fiascoes that reflects recent theoretical trends and was developed in response to a growing body of research that has failed to. S it appears that merger expansion was not only a phenomenon of prosperity, but that it was also closely related to the state of the capital market. Groupthink is a communicable critical mass for business. First, we assume that managers derive private benefits from operating a firm in addition to the value of any ownership share of the firm they have. Groupthink theory defines several antecedent factors that combine to form the. Groupthink psychological studies of policy decisions and fiascos. Cohesive decisionmaking groups can be victimized by groupthink when unanimity becomes more important than critical evaluation of alternative courses of action. In the past few years, the federal trade commission and department of justice challenged one merger transaction, and considered challenging another, that departed from the enforcement paradigm of the last thirty years. In 1982, social psychologist irving janisheir to a long line of others who had shown how social pressures and the power of the situation can combine to make.
In practice this is mitigated by lockup fees and breakup options. Groupthink is a term coined by psychologist irving janis in 1972 to describe a process by which a group can make bad or irrational decisions. Two reference cycle expansions, unaccompanied by a strong upswing in stock prices, were marked by the absence of a merger revival. Through a series of indepth case studies of histori. When groupthink occurs, the desire for group unanimity overrides the motivation to realistically discuss and appraise different alternatives janis. This document gives an overview of the book and contains the table of contents, a description of associated software, an excerpt from the preface, and an excerpt from chapter 1these give a sense of the. Although janis groupthink theory was based on historical case studies and not empirical evidence it quickly found mass appeal. Groupthink is a term first used in 1972 by social psychologist irving l. How to avoid group think and achieve the wisdom of the crowd.
Another interesting definition of groupthink is decision making by a group in a way that discourages creativity or individual responsibility and is often characterized by excessive efforts to reach agreement. Groupthink irving janis, 1972, 1982 exam2 communication. Consensual decisionmaking in community forestry users group case study of nepal swati negi 1. A study of groupthink in project teams semantic scholar. An adjunct of this study is the development of a comprehensive, computational model of postmerger integration dynamics. Psychological studies of political decisionmaking reflect different orientations and research traditions within. Moreover even when testing the whole groupthink model, only weak support has been shown henningsen, henningsen, eden.
The word synergy entered the merger lexic on during the 1960s merger wave to describe gains from conglomerate mergers that could not be readily identified, but were presumed to be present to explain why the mergers occurred. Groupthink is a psychological phenomenon that occurs within a group of people in which the. Homogeneity of members social background and ideology b2 provocative situational context n. Janis showed how this phenomenon contributed to some of the major u. Here are four simple ways to help them avoid group think and achieve the wisdom of the crowd. In the first edition victims of groupthink, iriving l. The 2011 revision to the antitrust division policy guide to merger remedies signals a shift in the department of justices approach to merger remedies. Irving janis introduced the theory of groupthink in his classic study victims of. We are not talking about mere instinctive conformity it is, after all, a perennial failing of mankind. Apr 02, 2009 our theory of mergers is able to reconcile both of these stylized facts. Einerseits handelt es sich hier bei um ein sehr komplexes modell, denn es enthalt sehr viele variablen. Groupthink could have easily permeated my experience and delayed placement in a shelter even longer than it did.
Applied mergers and acquisitions aims to present a onevolume coverage of practice and research in a way that is both pragmatic and rigorous. Janis 1971,1972, 1982,1989 suggested methods to prevent or minimize the supposedly dysfunctional consequences of groupthink, including the following. Theories in merger and acquisition mergers and acquisitions. However, there are a number of social forces that can hinder effective group decision making, which can sometimes lead groups to show process losses. Janis 1982 provided eight symptoms of groupthink see table 1 and a list. Janis published an influential book in 1972, which was revised in 1982. Evaluating janis groupthink model of faulty decision.
This relation establishes the link of post merger performance improvements towards shareholder value creation. Groupthink has been defined in a number of terms, but the recurring term most often used is conformity. One of these two levels is the individual level and the reactions of the individual employees are insecurity, powerlessness, alienation, a drop in productivity, loss of energy. According to janis 1982, five features are typically present when groupthink occurs.
Learn vocabulary, terms, and more with flashcards, games, and other study tools. Groupthink and theory of competition by gesa rosenberg on prezi. What are the characteristics of groupthink, and what are the potential consequences of the groups decision making process. The groups are informal in nature but have a formal purpose. Groupthink being a coinage and, admittedly, a loaded one a working definition is in order. There is much stress because of great time pressure. Janis 1982 said that groupthink is most likely to occur when three. Define crossfunctional teams, discuss the management of virtual teams, and explain what makes a team effective. It is concluded that postmerger performance improvements prove the existence of mergerinduced synergy. Our theory of mergers is able to reconcile both of these stylized facts. Groupthink groupthink is a style of thinking that people can engage in when they are deeply involved in a cohesive group. The group leader should encourage all group members to air their doubts and objec.
A psychological study of foreignpolicy decisions and fiascoes. Second, we assume that there is a regime shift that creates potential synergies. Janis summarizes this attitude as everything is going to work out all right because we are a special group. Groupthink became extremely popular in a wide range of literature.
A behavioral theory of the merger carnegie mellon university. These results only partially support janis groupthink model. The earlier remedies guide, issued in 2004, emphasized structural remedies such as divestitures as the preferred approach to resolving competitive problems with mergers. Check your understanding of the concept of groupthink with this interactive quiz and printable worksheet. What are the characteristics of groupthink and what are the. Profitability analysis of mergers and acquisitions mergers and acquisitions around the globe represent a huge reallocation of resources, within and across countries and therefore, it has been the interest of empirical studies for many years. See, for example, details of the 2001 first unionwachovia merger wall street journal may 16 c1, may 21 a4, and may 31 b14, 2001.
Some group process losses are the result of groupthinkwhen a group, as result of a flawed group process and strong conformity pressures, makes a poor judgment. Through a series of indepth case studies of historical incidents of group decisionmaking, successful and unsuccessful, janis adduces prima facie evidence that a principal impediment to good decisionmaking is groupthink, a syndrome in which. This paper advances an explanation for decision fiascoes that reflects recent theoretical trends and was developed in response to a growing body of research that has failed to substantiate the groupthink model janis, 1982. The failure to address the issues that concern merger and acquisition impacts the new and current organization very negatively at the stage of postmerger in two levels. In other words, the decision considered that the merger would reduce transaction costs and allow a more efficient production process for digital maps. In order to explain the reasons why companies are keen on mergers and acquisitions, many motives have been proposed by financial economists. For example, a selfmanagingcrossfunctional design team could combine the. Closedmindedness collective rationalizations stereotypes of outgroups selfcensorship illusion of. The failure to address the issues that concern merger and acquisition impacts the new and current organization very negatively at the stage of post merger in two levels. Gruppendenken ist ein moglicher prozess innerhalb einer gruppe.
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