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Does management by consensus work?

May 30, 2008

Are you working for company that’s a firm believer in MBC – management by consensus? Its a management style where every significant decision is brought to the table for all managers to mull together and decide.

Some time back, there was a company that wanted to relocate its signboard at the office lobby. The ceo called all 18 managers (4 of them VPs) to a meeting to deliberate, debate, and argue over why its necessary to move the signboard to the left by 24 inches and how it will or will not effect image and business. I am not kidding.

While it does look a bit extreme, in the course of my work I have come across two such companies. They cite their own reasons, a popular one being, “Well we want all managers to take ownership of the problems. If there’s no support, any change will fail.” Another favorite is, “We believe in transparency and participation.”

So in this spirit of equal participation, the company I mentioned wrote off 36 executive man-hours worth $4,000 just to decide to relocate a signboard, a job that costs $100. Wow.

So anyway, I had a ringside seat to the event, having been invited to sit in as a consultant. It was a revelation. After the managers were seated and a round of good mornings, the ceo tossed the ball on the table. A polite quiet soon turned into a free for all. Someone demanded who put the signboard there in the first place. Another asked why is it so small. Another said it should not be in the lobby but out there by the street. On and on it went, with healthy doses of finger pointing. The ceo, being a polite soft-spoken man, just sat and watched the food fight. When it died down, by a majority show of hands, the team made a ‘collective decision’ to go ahead and move the sign 24 inches to the left.

On our way out of of the meeting room, one of the managers nudged me and cynically whispered, “See? We run this place by democracy!”

Several one-to-one conversations with the managers later, a few things became apparent. First, the managers were sick of these petty meetings and second, everyone pointed to a similar theory as to why it was happening. At one time it seems, the ceo made a decision to spend some money on a marketing program. The program flopped and he got a pounding from the board of directors for it. Among the things he got hit with was that he did not consult his managers. For whatever reason, he got spooked with it.

After that the ceo imposed a strict policy of management by consensus where nothing happens without a popular vote. Soon, everyone was joking that you should get a management consensus before you go to pee. Not pretty I can tell you.

Like I said, this was an extreme case on consensusitis which saved the ceo’s ass but wreaked havoc on staff morale and productivity.

Back to the question – does management by consensus work? My short answer is no. If decisions came down to popular vote, then ceos would have long been replaced with computerized vote-counting machines. I see companies as living organisms. When a company is young, it needs a firm but caring hand to tell it what to do. When it is mature, its arms and feet can be trusted to make their own decisions, within reason of course.

In any case, regardless of maturity phases, plain common sense should prevail. If only people stopped to think, they’ll realize there’s only one way to describe spending $4,000 on a decision to spend $100: pure lunacy.

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4 Comments leave one →
  1. May 30, 2008 10:30 am

    Hello.

    I would like to put a link to your site on my blog roll if you want to do the same for mine. It would be a good way to build up both of our readerships.

    thank you.

  2. Damien permalink*
    May 30, 2008 2:17 pm

    Hi Sue, certainly you’re welcome to link to my blog.

  3. LC Teh permalink
    June 2, 2008 1:33 pm

    This sounds so like my rants and the our work smart culture

  4. Damien permalink*
    June 2, 2008 2:18 pm

    Hah, read them and had a few LOLs. Now you’ve given me a topic to write about. I think our local ceos are the embodiment of the work smart don’t work hard credo. Ask a ceo about why their top product is better than the competition, he’ll give you a blank face and say that’s not my job, that’s the product guy’s job. Now try asking the same question to a British or American ceo and he will tell you everything about the product and then some. Evidently for our ceos, knowing the details is not ‘smart’.

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