Sounds like your company wasn't familiar with how to handle a works council and treated it as an annoying necessary evil. AFAIU works councils are not supposed to be handled like that. They are supposed to be an integrated part of management, so them blocking something after a decision has been made just won't happen. If you do it that way, they won't like you.
The usually decent working relationship between management and works council is part of unions not being seen as petty (e.g. "employee X is strictly forbidden to do work Y even for a second, consequences be damned") and greedy here in Germany. Wal-Mart tried union busting here and it didn't go well at all.
All that being said, a well handled works council is probably going to slow down a company, but not after decisions have been made as you described. It is also going to help make better decisions sometimes.
This was at a large, established German company with German management. It wasn't as extreme as you are reading it but these dynamics did exist. Having large American offices working closely with the German ones made the impact of the works council on the operation of the company quite obvious because the Americans on a team were not subject to it (and there was a directive to operate "west coast style"). My other American friends that worked many years for German companies observed the same patterns.
I'm not saying works councils are bad per se, but they do have an effect on flexibility and execution speed that is significant enough that many Americans notice, especially in the western US where fast and flexible is the native mode of business (eastern US traditionally has a bit more rigid and European-like business culture).
The usually decent working relationship between management and works council is part of unions not being seen as petty (e.g. "employee X is strictly forbidden to do work Y even for a second, consequences be damned") and greedy here in Germany. Wal-Mart tried union busting here and it didn't go well at all.
All that being said, a well handled works council is probably going to slow down a company, but not after decisions have been made as you described. It is also going to help make better decisions sometimes.