Radio Interview on Sirius'
"Good Business"

Interviewed by Michael Conner, Editor of Business Ethics Magazine, on Sirius Radio's "Good Business".

Michael Conner: So, why is consensus so important?

Larry Dressler: Well, over the last 15 years, I've heard business leaders consistently cite four challenges their companies face:

• Speed matters. We need to make decisions in a way that ensures fast, glitch-less implementation
• The more complex our environment becomes, the more we need to involve multiple perspectives and varied disciplines in our decisions.
• Technology has put critical knowledge in the hands of people throughout our organization. No one person has all the answers
• We have a new generation of employees who want to influence. We will lose them if we can­t engage them.

These trends speak to the value of inclusive leadership and approaches to decision-making that put the right people in the room to discuss the right issues. Consensus is one of these approaches.

MC: Are most people aware that they shift from one decision model to another?

LD: One of the most important functions of leaders is to define up front how decisions are going to be made ë to define the model as you say. Too many meetings end with people scratching their heads and wondering whether a decision was made and what that decision was.

In some companies, decision-making is a lot like the Wizard of Oz behind the emerald curtain ë lots of smoke and magic. But in organizations, that kind of lack of transparency leads to confusion, cynicism, speculation, and political jockeying ë none of which do a whole lot to build profit.

MC: Do you see businesses adopting consensus more and more?

LD: Some of the companies we associate with innovation and performance, like Saturn and Intel have definitely mastered the art of group decision-making.

Though, I must say, there are some management gurus out there who have boldly declared consensus to be a bad idea. If you read their critique carefully you quickly realize that they are not talking about real consensus -- they are talking about unanimous voting. There­s a huge difference. In unanimous voting, everybody gets their first choice. In consensus participants give up personal preference to design solutions that are in the best interest of the organization ë solutions each member can in good conscience support.

MC: It seems like consensus works with small groups but what about companies of 10,000 people?

LD: This is a great question because it illuminates one misconception -- that consensus means EVERY decision includes EVERY person. One of the most important aspects of consensus is deciding who should be at the table for any given decision.

In fact, my book describes criteria for determining who should be involved in a given decision. Look for those individuals who possess special knowledge or expertise, those who will be charged with implementation, and those who will be most affected by the decision. When it comes to consensus in very large companies I think about the unprecedented turnaround achieved by Mitsubishi Motors of North America in the late ”90s. Mitsubishi had lost $350 million over 10 years and was looking for a way to turn things around. The company was fragmented and the culture was very much one that encouraged people to go it alone. The new CEO, Pierre Gagnon formed 12 strategic change teams to address issues ranging from brand identity to product quality. Each of these teams consisted of diverse players from every part of the organization ë dealers, executives, and front line technical specialists. Pierre charged each team to develop consensus based recommendations. No recommendation made it to the executive level unless everyone on the team was prepared to stand behind it. Mitsubishi went on to flourish over the next five years, increasing profits by 94%. They turned things around because they drew on multiple points of view and mobilized high levels of commitment from those who would need to execute on the decisions.

MC: Is consensus the only way to go? When might you choose another approach?

LD: I don't believe consensus is a panacea for business. Decision making methods are like golf clubs ë you want to select the right one, depending on the particular shot and the conditions. Choosing "consensus" as the right tool often makes sense because it facilitates a high quality decision, fast implementation, and commitment on the part of those implementing the decision.

In the book, I provide some guidelines for determining when consensus is right. One criterion is that it­s a high stakes decision that, if poorly made, has the potential to fragment a team, organization or community. Another is that successful implementation will require high levels of commitment from those implementing it.

So, for example, when a corporate travel management company needed to decide whether it would go forward with an acquisition, the CEO decided to make it a consensus decision among members of the management team. He could have made the decision on his own but he understood the success of the acquisition would depend on the support of his team. He also understood that others on the team might see things that could make the difference between millions lost or gained.

MC: What are some other examples of consensus in action?

LD: I can tell you that I­ve seen consensus decision-making used in high-tech companies, government agencies, the military, accounting and law firms, and on non-profit boards.

I know of a toy manufacturing company that regularly uses consensus to make strategic decisions. The CEO called a meeting with senior managers and other stakeholders from the US, Europe and China to talk about direction for the company. As proposals were considered, the CEO frequently stopped the conversation to ask:

"OK, it sounds like we are in agreement but I want to check for level of real commitment. I want to hear from those folks who have important concerns about this direction"

No goal or initiative moved forward unless every member of the team was comfortable with the direction and had vetted their concerns to the group.

MC: I notice in your book that one prerequisite is a facilitator. Does this mean you can't do it without a facilitator? And does this mean it­s really complicated?

LD: When I think about a facilitator I don­t mean an outside consultant with specialized expertise. Anyone can learn the basics of consensus by reading the book. And like any skill, it­s all about practice.

The real value of the facilitator is that he or she is a third party with no stake in the decision. It­s someone who can objectively help the group to see where there­s common ground, where there appear to be unaddressed concerns, and when full commitment has been reached.

I am a big supporter of organizations maintaining their own internal corps of facilitators ë people who are trained to assist in making any deliberation productive and satisfying.

MC: Can you teach people to reach consensus?

LD: Yes, the premise of the book and our resource web site called consensustools.com is that given the right principles and some practical tools, this approach can become as natural as any other tool in the workplace.

If you think about it, meetings are probably the most commonly used business process. Ironically, we don­t train leaders on how to effectively bring people together to do their best thinking and to mobilize support and action. We expect it of our leaders but we don­t actually teach them.

So, when I wrote Consensus Through Conversation my mantra was "Give readers everything they need to know in a book they can read on a flight between LA and Seattle ë 2 hours"

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