Creating the Organization 349There are also the problems that can afflict any team—such as inefficiencies of time,
groupthink, groupshift, and poor interpersonal skills.^33 Good group processes take
time. People need a chance to discuss, communicate, revise their views, and develop new
options. Sometimes time is of the essence, and the entrepreneur cannot wait for group
discussion and consensus. Under these circumstances, the team must act quickly and
forgo the process it has carefully nurtured.
Groupthink prevents the team from critically evaluating and appraising ideas and
views. It hinders the performance of groups by putting conformity ahead of effective-
ness. The principal symptoms are rejection of evidence that contradicts assumptions,
direct pressure on doubters and nonconformists to drop their objections, self-editing by
group members reluctant to present opposing points of view, and the illusion of una-
nimity. The best ways to avoid groupthink are (1) to have the leader remain impartial
until the end of the discussion, and (2) to develop norms that allow all members to
express dissent without retribution.^34
Groupshift is the phenomenon in which the collective decision of a team is either
more or less risky than the disaggregated decisions of the team members. Sometimes
people take larger or smaller chances in a group than they would on their own.^35 To
make their point, people tend to exaggerate their initial positions in group discussions,
and these exaggerated positions may become the ones adopted by the group. Moreover,
when teams make decisions, the team is accountable, which sometimes translates into
“No one is accountable.” This sense of diffused responsibility causes members to be less
careful about what they approve.
Group effectiveness can also be ruined by the domination of a single member or sub-
group of members. If the discussions are so dominated, the advantages of diversity and
breadth of knowledge are lost, and people are de-motivated because they cannot con-
tribute. Worst of all, sometimes the person dominating the discussion is neither highly
skilled nor knowledgeable. When the mediocre control events, mediocre outcomes can
be expected.
The Board of Directors
The top management team may be augmented by a board of directors. In fact, although
the board and TMT members may overlap, the board is not the top management team
and should not attempt to micromanage the venture.^36
There are two types of boards: an advisory board and a fiduciary board. The primary
task of the advisory board is to provide advice and contacts. It is usually composed of
experienced professionals with critical skills important to the success of the business. For
example, if the business is primarily a retail establishment, merchandising, purchasing,
and marketing experience are important resources. People who have good contacts and
are open-minded, innovative, and good team players are prime candidates for an advi-
sory board.^37 A fiduciary board is the legally constituted group whose primary respon-
sibility is to represent the new venture’s stockholders. It is usually made up of insiders
(the managing founder and senior TMT members) and outsiders (investors and their
representatives, community members, and other businesspersons). In firms that are still
very closely held—that is, whose founders have not yet gone to the professional invest-