Reaching agreement on decisions in family business is no small task. When members of a family enterprise fail to make wise decisions, the business suffers. When decisions are made that polarize group members, family relationships are put at risk. Consensus decision-making helps to alleviate these problems. If a family is committed to working together for the long term, it is best to embrace the consensus model.

Families who use consensus decision-making are committed to discussing the issues at hand until there is full agreement to go forward in implementing a decision. Note that commitment to go forward does not mean that all agree with the decision. Consensus precludes voting, which has a tendency to polarize participants and often leads to “choosing sides.“  Under those conditions, feelings are often hurt and resentments build, which undermines the climate of working together.

In more than forty years of working as a consultant to family business, I know of no business that has sustained itself and the family relationships over time that has not embraced the consensus decision-making model.

Grant Gordon and Nigel Nicholson have written a book titled Family Wars, Classic conflicts in family business and how to deal with them.* In this book they chronicle the problems in family business, the alienation of family members and often the demise of high-profile, family-owned businesses. Their studies include families such as Koch, Ambani, McCain, Ford, Guiness, Bingham, Pritzker, Shoen and Gucci. There is great value in the study of families who have not been successful in managing the continuity of their enterprise. From such study we can learn a great deal of what not to do. It’s important to note that NOT ONE of these families was committed to the consensus model for decision-making.

The underlying principle of consensus decision-making is the commitment to a process that allows for all parties to contribute ideas and to feel positive about their interaction and role in the group.

Wikipedia has this definition of Consensus Decision-Making:

Consensus decision-making is a group decision-making process that seeks the consent, not necessarily the agreement, of participants and the resolution of objections. Consensus is defined by Merriam-Webster as, first, general agreement, and second, group solidarity of belief or sentiment. It has its origin in a Latin word meaning, literally, “feel together.“ It is used to describe both the decision and the process of reaching a decision. Consensus decision-making is thus concerned with the process of reaching a consensus decision, and the social and political effects of using this process. Consensus should not be confused with unanimity or solidarity.

In consensus decision-making, the objective is the “common good“ of the group. The process emphasizes relationship-building, which is grounded in trust and cooperation. Each decision-making session should start with the re-affirmation of this objective. Next, the issue up for discussion is identified and all participants have the opportunity to state their views. When all have spoken, the leader of the meeting summarizes the “sense“ of the discussion, pointing out any differences that might occur. The leader then moves the group through discussion of these differences with questions that draw out the subtleties of the matter. Once again, each person is presented the opportunity to state their views and the leader again provides a summary. If it is not possible to reach full consensus, the decision is deferred until the next meeting. This process is repeated until there is consensus to move forward. Power plays are absent from the consensus model.

Some argue that this model allows for one person to block an important decision. Various rules can easily be established to avoid blocking. If the group is large, they might require unanimous consent, less one person in agreement. Other groups may designate a “wise“ leader or counselor, who will determine if the one opposing view should be allowed to keep the group from moving forward on a particular decision.

Often those who oppose the consensus model take the position that “we must have a democracy“ and that means voting. The risk of this position, in terms of undermining the long-term trust and cooperation of the group, is great. It is well known that trust is the essential element to all long term relationships. Voting puts trust at risk; and when trust is breached, it is nearly impossible to rebuild.

It is possible to craft elegant business solutions, but the keys to implementation are always locked up in the psychology of the decision-making group. That psychology includes how group members feel about their participation in the decision-making process. Consensus decision-making creates a positive environment for members of family business to reach important solutions.

*Published in 1998 by Kogan Page Limited, ISBN 978 0 7494 4630 7

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