Why Consensus Kills Business Innovation

Why Consensus Kills Business Innovation

At a geopolitical level, there’s evidence to support the notion that democratically-governed countries produce higher levels of innovation than autocracies. But does that hold true when we’re talking about industries, businesses serving those industries, or departments within those businesses? I’m not so sure.

You can’t help falling over organizations of every size and persuasion boasting about the flatness of their corporate hierarchy. “We don’t have departments, we have teams. We encourage debate and discussion at all levels,” and so on.

But based on the observations from my ‘fly-on-the-wall’ vantage point, dealing with businesses of every size and industry, the reality is different. Of course, occasional outliers do exist. But for the most part any notion of working towards a point of majority consensus on a contentious business decision is for the birds.

Invariably the HiPPO has the casting vote, which kind of negates the value of having a meeting about the problem in the first place.

The tricky part of innovation is that, by definition, the result is something that hasn’t been seen before. The goal is to solve a problem, or series of problems, in a way that currently doesn’t exist. As an inevitable consequence, the process is going to involve considering thoughts and ideas that don’t sit well with everyone in the room.

But that’s the entire point. If the answer was obvious, or could be deduced from conventional rational thinking, we would have found it by now. The fact that we haven’t, means we have to change the thought processes that got us here.

Why Most Businesses Don’t Innovate

I’m sure you’ve been in a thousand meetings like this. It starts off slow, with someone outlining the problem at hand and what they’ve considered as responses. They’ll go through the pros and cons of each option, concluding that none of the choices are a great fit. The floor is then opened up to the meeting participants who all react in the same way: silence.

Silence, that is, until the most senior-ranked person in the room pipes up.

What happens next? Everybody in the room jumps all over everyone else to give their two cents. But the comments are nothing but variations on what others have said. Even worse, they are proffered for no other reason than to inflate the senior-ranked executive’s ego. Either way, it spells disaster.

So what went wrong?

It all went south as soon as the senior-ranked person opened their mouth. In that microsecond, for no other reason than their elevated corporate status, the meeting descended into an exercise of conformity and groupthink. Any inkling of diversity of thought disappeared as fast as the plate of cookies in the center of the table. Anyone who had even the most minuscule semblance of an out-of-the-box thought has buried that idea in the depths of their subconscious. The game’s already over, and we didn’t even finish taking the pieces out of the box.

The result of the meeting is broad consensus for reasons of vanity, politics, subservience, conflict-avoidance, or a combination of all the above. For many reasons people may choose to follow the herd, rather than engage in constructive and healthy debate.

But a consensus of opinion isn’t what’s required. When everyone agrees, nobody questions. We can’t solve tomorrow’s problems by using today’s thinking.

Innovative Ideas Come From Unconventional Thinking

Any suitably out-of-left-field thinking runs the risk of being ignored or ridiculed. If the idea is sufficiently big and audacious, some people are going to push back.

But instead of shutting these ideas down, we need to learn to encourage them – regardless from where they came. It’s only through consideration and experimentation can we challenge our inbuilt assumptions and biases, consider alternatives and – ultimately – design better and more innovative solutions.

Many businesses today are born from ideas that, at the time, seemed ludicrous. Imagine Howard Schultz telling you he wanted to sell you a cup of coffee for 10 times what it costs to make coffee at home. You would have thought the guy was two beans short of an espresso. Today, Starbucks is worth around $140Bn.

Or consider Richard & Maurice MacDonald, the founders of a certain fast food restaurant franchise you may know. To reduce customer waiting times, they cut the menu from 25 items to 9 and implemented an innovative (for the time) kitchen assembly-line process. They succeeded in dramatically reducing operating costs and customers were happier to get their meals faster (even at the expense of reduced choice).

Such innovations don’t stem from everyone falling into line with the group worldview, attained from a meeting where no-one wants to speak their mind.

Majorities Don’t Just Rule: They Influence

Most managers conduct meetings with the goal of expediency, not result. In order to avoid wasting time addressing weird thinking or dissenting opinions, they see meetings as a way to quickly reach a particular decision. Now fill the room with sycophants and you’ll reach group consensus faster than you can say “share options”.

As marketers, we know about the dangers of Confirmation Bias. People are predisposed to mimic the behavior of others, rather than use their own judgement. It’s part of evolutionary psychology, rooted in our innate desire to ‘fit it’ by maintaining the status quo.

Again, there are plenty of business examples that bear this out. In its heyday Yahoo turned down the chance to buy Google (twice!). Another example is Kodak’s senior management team actively sitting on the work of employee Steve Sasson, when he created the world’s first digital camera. Their reasoning was the company was doing very nicely from profits made from selling film. They weren’t about to kill that revenue stream, thanks all the same. I’m not saying embracing digital image capture back then would have Kodak on a far firmer footing that the company has today. But I think it would have made it far more likely.

Real and lasting innovation comes from strong, singularly-focussed ideas. Such ideas are often initially unpopular or divisive. Business executives need to be more open in their consideration of deep-set opposition, as well as actively building strategies to surmount it. Even today, many won’t even consider the validity of an opposing opinion within their organization.

Innovation Mandates Strong Leadership

Ignoring contrary opinion may have contributed to such business mistakes as Amazon’s Fire Phone, or Apple’s doomed social media network Ping.

Almost as bad as dismissing the naysayers (or not speaking up as a naysayer yourself) is seeking concession in order to please the group. Innovation calls for strong leadership to maintain focus and prevent ideas being diluted in order to appease.

Yes, it’s important to acknowledge dissent, to understand its root, and consider its contrary position. But at the end of the day, some innovations cannot be agreed by consensus. Imagine if the first iPhone was designed by committee, or if Starbucks’ business model was put to a vote. The chances of either succeeding would have been slim at best.

Implementing a game-changing idea is never easy. If it were, we’d all be doing it. By the very fact of their inability to be resolved and sufficiently interpreted by rationalized thinking, such ideas are perceived as risky and counterintuitive. They need advocates. Champions within the company whose role is to inspire, defend, assuade, lobby, and empower beliefs.

Which is why leadership drives innovation, while consensus neuters it.

DotCom Magazine Impact Company of The Year 2021 Award Winner

About the Author

Avatar for Gee Ranasinha

Gee Ranasinha

Gee Ranasinha is CEO and founder of KEXINO. He’s been a marketer since the days of 56K modems, lectures on marketing and behavioral economics at a European business school, and was noted as one of the top 100 global business influencers by sage.com (those wonderful people who make financial software).

Originally from London, today Gee lives in a world of his own in Strasbourg, France, tolerated by his wife and teenage son.

Find out more about Gee at kexino.com/gee-ranasinha. Follow him on Twitter at KEXINO, on Facebook at facebook.com/ranasinha, or on LinkedIn at linkedin.com/in/ranasinha.

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