Why do workplaces suddenly become toxic? Why risk losing market position for short-term gain?
Canaries were once regularly used in coal mining as an early warning system. Toxic gases such as carbon monoxide or asphyxiating gases such as methane in the mine would affect the bird before affecting the miners. The presence of singing canaries was a sign of healthy air in the mine.
Similarly, the presence of happy staff is the sign of a thriving company. When workplaces start to become toxic the following usually happens in four stages:
So how and why does this happen?
Two factors can lead to this, one is deliberate policy by senior management, and the other can be due to knee-jerk reaction to external factors.
Management can instigate changes without consulting the staff, due to pressure from shareholders. In a corporate environment senior management can be too distanced from the day to day workings of the team or be in a different location or region. This can lead to decisions made that make sense on a spreadsheet or might make an accountant happy, but impacts work negatively. It can also happen when a company goes through a takeover or having new management trying to make their mark.
It can also be due to real external circumstances, such as increased competition, financial instability or increased costs. When this happens staff are usually asked to make sacrifices that are meant to be short-term but somehow never end despite the crisis passing.
So what happens?
There are two strategies that a company might adopt which are not necessarily mutually exclusive but are not as effective as each other. One is to focus on cost-cutting and creating efficiencies, the other is to innovate, grow the business and become more effective.
The orthodoxy according to many MBAs is to immediately cut “costs”, with people being one of the main costs of a business. Instead of innovating, investing in staff or trying to win new business there is an increased focus on cost-cutting, efficiencies and the bottom-line. Targets are raised, head count is reduced, travel bans are instigated and the experienced staff are made redundant. At Da Vinci’s Workshop we call this The Efficiency Illusion, where effectiveness is sacrificed to achieve efficiency. The canaries recognise what is happening at this stage and start to leave.
Now what is counter-intuitive is that in the short-term this strategy works. Existing staff work harder to make up for the gap, so the company makes more money and the share price improves (investors love cost-cutting and efficiencies). This makes senior management think that their strategy is working and that the staff are just “moaning”, so the cost-cutting is increased, headcount is further reduced and pay-rises are frozen. This is when those who were holding out for things to change or believed the situation could be improved start to leave, leaving a massive gap. Those left now have to fill the knowledge and experience gap with fewer resources and lower motivation; from the company perspective however, they have made massive savings because experienced staff cost more, there was no need for further redundancies and those left are usually hostages (too terrified to leave).
This is the classic business three-year cycle. In the short-term this strategy works, the share price goes up and costs go down. CEOs and board members receive their big bonuses despite the complaints of staff and they possibly move on to a different company with a large pay-off during this period with tales and evidence of success. As management consultants and business psychologists, we have seen this cycle many times and we are usually brought in at the end of it to help repair the damage.
In the medium to long-term, they have gutted talent and reduced potential to compete and grow. Organisations that do this lose talented staff, fail to innovate, lose customers and sustain reputational damage. The biggest damage will be that man-hours will be lost and wasted which will prevent staff from innovating, growing the business and exploiting new markets. There is simply no capacity for anyone to pursue new leads, create ideas or take risks.
How to recognise a workplace that is becoming toxic:
Don’t damage yourself trying to “save the company” and never listen to that “someday this will be better” spiel. A company doesn’t need to be constantly growing to be an amazing company, always remember that. Amazing happens every day at amazing companies. There is no-one at an organisation who is indispensible and you will be replaced quickly when you’ve burned out or your job will be quickly automated or outsourced.
So what can you do as an employer? Instead of focussing on cost-cutting, focus on retaining clients, winning business and innovating. Develop long term strategies and not just chase every quarter. Invest in systems and processes that will help your staff to become more effective and consult with them on how to make improvements. Correctly train your staff properly to use principles such as Lean, Kaizen, Agile and other forms of process improvements to make long-lasting changes (these processes are about improving process not cost-cutting). Recruit talented people with ideas that will help you disrupt your industry, give them time to take risks and innovate and empower them to help you become the market leader. Otherwise what’s at stake is your reputation and results, which will be like the titular canary (dead down the mine).
Leonardo Da Vinci “The natural desire of good men is knowledge.”
What do the 3-point safety belt harness, the world wide web and the polio vaccine have in common? What drives people to give their ideas away for free? What can this teach us in the workplace?
All of our articles and videos, as well as our Inner Ape Tool: To Improve Empathy and Communication have been released for free. We believe that information should be shared. In this final article of our series of twelve articles on leadership, we explain why.
Why release information for free?
Sharing information in engineering
The Volvo 3-point harness seatbelt, which has saved over a million lives, was 60 years old this summer. It was invented by Nils Bohlin, a Volvo engineer, and it cuts your risk of death or serious injury by more than 50%.
Why did Volvo not patent this design? They did, but under an “open patent” freely available to anyone, and within five years it was being used in cars across America and Europe. While Volvo have made no direct money from this game-changing invention, it has cemented the company’s reputation for safety.
Nils Bohlin, inventor of the Volvo three-point harness
In 2016 NASA released 56 formerly-patented technologies into the public domain, including for advanced manufacturing processes, propulsion methods, rocket nozzles and aircraft wing designs. It also created a searchable database for expired NASA patents, which is available here: http://technology.nasa.gov/publicdomain
Sharing information in technology and computing
2019 also saw celebrations of 30 years of the world wide web which was invented by Tim Berners-Lee at CERN in 1989. He released the source code for free and, as of November 2018, he estimates that half the world’s population, 4 billion people, were connected online. There are now more webpages than neurons in the human brain. The web’s greatest strength is the ability of anyone to build anything, without asking permission.
Tim Berners-Lee at CERN in 1994
2012 Olympic opening ceremony
In 2018, Microsoft, which was historically hostile to Linux, made peace and joined The Open Invention Network, the Linux-based patent non-aggression community. Microsoft marked the occasion by releasing 60,000 patents for Linux-related open source projects. Elon Musk also announced that Tesla won’t sue companies that want to use its technology.
Wikipedia was founded in January 2001 with no central organisation which would control editing (unlike existing encyclopaedias like Microsoft Encarta). This allowed the site to grow incredibly rapidly, from 1,000 articles within a month of being founded, to 1 million articles being written by 2006. It is now the world’s fifth most popular website.
Sharing information in medicine
Jonas Salk refused to patent the polio vaccine, famously saying “There is no patent. Could you patent the sun?” In America in pre-vaccine years, polio paralyzed between 13,000 and 20,000 children annually. The polio vaccine was part-funded by the public: over 80 million people donated money to the National Foundation for Infantile Paralysis (now called the March of Dimes, to reflect the many people who only donated the few cents they could spare).
Newspaper headlines celebrate the success of the polio vaccine.
What is the alternative?
The opposite of this philosophy is Disney who keeps a stranglehold on all content it produces. Disney fought for copyright to be much longer than the 14 years it was first given for Mickey Mouse. Every time Mickey Mouse has come close to being released into the public domain, Disney has fought vociferously to extend patent. This protects some rights of the author, but it stifles creativity and storytelling. All the Disney stories were previously in the public domain - Cinderella, Rapunzel, Aladdin - but now Disney owns the rights to its version of these traditional tales.
Another example is research papers, which scientists publish for free, yet publishing companies charge money to access the research. It holds science back and restricts learning and knowledge. We believe great advances could be made if all this information was shared openly and freely.
In summary, why release information for free?
Links to further reading:
Leonardo Da Vinci “Poetry is painting that is felt rather than seen.”
How can you tell a story that sticks? How can you encourage your employees to share in your vision of the future and imagine better times?
In our previous articles we discussed leading change, we will now look at how we can persuade others and embed change. Telling a story is really powerful. Some people are natural storytellers, but everyone can learn techniques to bring their stories to life.
There are six principles that can help embed our communication and make them “stick”. They are:
What is even more effective than telling a story is helping your people to create their own story. As discussed in our previous article, our golden rule of influencing is: Ask don’t tell.
In the Royal Mail in 2010 there was a need to automate. When Royal Mail announced the changes to staff, the management team told a (true) story. What was essentially communicated was “We have huge operating costs, a big pension deficit, and lots of competitors who are much more efficient than us. We MUST automate.”
Despite the story being true, the unions immediately co-ordinated strikes which only ended when employees were awarded a pay increase, a shorter working week and greater job security.
When managers changed their approach, things changed. Managers sat down with union representatives and started asking questions. They said “We have competition, what does that mean for our people? Where do you think we can improve to stay safe as a company? How can we keep people safe and in jobs?” The solutions that emerged were to automate and not impose redundancies; they agreed to reduce staff numbers through natural staff turnover and not replacing leavers.
This changed how people were feeling about the change from resistance and reticence to being engaged with "build in". How can you learn from this and bring your team on board from the beginning?
Goffee and Jones talked about the importance of authentic leadership and how followers need to trust their leaders in order to embed change.
So, if you have a change you want to implement, how do you write your change speech? Think about group polarisation, can you find examples of other people doing the same thing? Think in advance about where the budget will come from. What article or news story could you show your audience 24 hours before your speech? This is called priming. Where can you tell a story? Choosing the right location can have a huge impact on an audience’s receptiveness. Where can you add images? Build a persuasive / emotional business case, not purely a financial one. We have trained thousands of people in these techniques and it is very rewarding when people change from being shy and nervous to becoming willing to take their ideas to the CEO.
A caveat; these techniques can be used for manipulation as well as influence. Marketing companies regularly use these techniques to manipulate; so do politicians. A quick guide to whether you are using these techniques ethically is, are you willing to be transparent to your audience about the techniques you have just used?
Links to further reading:
Made to Stick: Why Some Ideas Survive and Others Die, by Chip Heath and Dan Heath
Goffee and Jones: Why Should Anyone Be Led By You? https://impact.ref.ac.uk/casestudies/CaseStudy.aspx?Id=44529
Leonardo Da Vinci “Where there is shouting, there is no true knowledge.”
In our first article last week on leading change, we looked briefly at the story of the saboteurs and the luddites. While they may have been responding rationally to a perceived threat to their livelihoods, they also would have been responding emotionally to a threat to their sense of expertise or self-worth. Occupations used to be so intertwined with the intrinsic sense of self that many people today still bear the hallmarks of their ancestors’ careers in their names (5.7 million people in the UK and Ireland still have occupational surnames). The Weavers, the Smiths, the Carters, and the Taylors: all these names suggest generations of skilled craftspeople. If your career is woven into your name and that career is replaced by a machine, what does it say about who you are?
Today, we are less likely to be named after a job, yet what we do can still have a strong impact on our sense of value, significance and self-worth. There are two typical change projects that we see in companies today: amalgamating two teams into one, or bringing in a big IT project to automate various functions. If you have been tasked with leading one of these projects, how do you help your team through the inevitable emotional turmoil that will come with it?
Carol Druick, who wrote the book ‘Growth and Fixed Mindsets’, insists it is your ethical duty as a leader to enable people to engage with change in a positive way. We recommend a good place to start is by talking your team through ‘the 4 laws of change’.
A Video of the Four Laws
An amusing example of Law 4 is below. It shows how something that didn’t exist 30 years ago has quickly become essential.
Here we will use an adapted version of the McKinsey model of behavioural change to show how you can ask not tell (Law 3)
1. Understanding why
2. Develop skills
3. Processes and systems
4. Role modelling
Your role as a leader is to empower individuals to act, to create leaders not followers.
Understanding why: set a vision and tell a story that means people want to engage in change. Remember to ask here too. Ask your employees what is happening in the wider industry or the wider world. What changes are coming and what does that mean the company needs to do to survive and thrive? The ‘why’ might be obvious to you, but not to others. It is important to be explicit. Often, when speaking to senior managers, they think they’ve fully communicated the plan. Whereas, when we speak to people on the ground, they don’t know what’s going on. Instead of sending one ‘copy all’ e-mail, communicate continuously, in different ways. Ask for feedback to check whether a message has been received, and start a dialogue to find out if your employees have any better ideas.
What if your team comes up with different solutions to your plan? If they are good solutions and you are a good leader, you would follow the team’s plans. Being wedded to a rigid plan before consulting the people it will affect is not true consultation. If a team have developed the plan themselves, they will feel in control and significant and will be more likely to act purposefully.
Develop skills: The McKinsey model says to teach your employees the skills they’ll need. The 4 laws of change suggest to ask them which skills they think they’ll need. Watch this amazing video from David Marquet, the captain of a nuclear submarine, who turned around the submarine’s poor performance by stepping back from his role of issuing orders and pushing leadership down through the ranks:
Processes and systems: Let the people own them. Top-down leadership doesn’t work. It often unintentionally ends up asking the impossible. We have known highly competent, driven, successful managers to resign from their jobs because senior leadership was asking them to impose processes and systems on the workforce that were simply impossible.
Role modelling: The McKinsey model says to role model positive behaviours. We would add here the importance of vulnerability-based trust. Share your fears about the future. Role model by saying things like “I don’t like the idea of this change, but I have faith in us as a team and we’re going to do it well.” It’s ok to be worried about change. This is natural and human. Go on a journey together. Ask your team “How can we make this a success for us?” Patrick Lencioni speaks very eloquently on this when outlining the 5 types of dysfunction in a team.
That example was anecdotal success from one company. We were able to test this theory in a series of experiments carried out at a global insurer, with teams manufacturing paper boxes. During leadership training (with permission from the attendees) we were able to gain 20% higher output by allowing them full autonomy. The high output group was able to choose their own group name, and their own methodology for manufacture; the control group had these imposed. Time and time again the team that had the most autonomy produced the most boxes.
It is possible to drive change by creating a ‘burning platform’. This sounds like “If we don’t change, we’ll all be redundant.” Wouldn’t it be much better though to create a ‘beautiful vision’? Ask your team to imagine “What would happen if ...?”
The hardest change management projects we have worked on have been where trust between the senior leadership and the workers has been broken in the past. Beware of false consultations. Only carry out an employee survey or a consultation exercise if you are willing to act on the results.
The most important law is: Ask don’t tell.
Dr Iris Firstenburg has written on the deeper psychology of motivating people through change and how to “build-in” change as opposed to just create “buy-in”. Buy in means: the plan has already been made; you’re just selling it to people. An example is an estate agent saying “Buy this lovely house.” Build in means: you’re asking people for their ideas to develop the plan. This is your partner saying “Let’s design our dream house together.” Which of these scenarios would excite you the most? Which one would you be willing to do the most work for?
The key to leading change is, you don’t lead change, you enable it.
Links to further reading:
Leonardo Da Vinci "In rivers, the water that you touch is the last of what has passed and the first of that which comes; so with present time."
In our previous article on automation we discussed the impact and a few of the benefits of digital revolution. This article focuses on the psychology of how to help lead people through change. We will examine why people can sometimes resist change even though it might be an improvement or inevitable and how to help them accept and embrace it. In this article we will look at the traditional models such as Fisher’s Transition Curve and Kotter’s 8 steps; in the next article we will visit a few more modern concepts such as the 4 laws of change, the McKinsey's model of behavioural change and the 6 sticky principles.
This is not the first time that we’ve seen resistance from the general population towards technological change. Historically, the word “sabotage” was believed to come from the practice of disgruntled workers causing work stoppages by throwing their wooden shoes (sabot or clogs) into the looms of 15th-century textile mills.
Why would the luddites want to “clog-up” the machinery? From a rational perspective it makes little sense; the machinery had the potential to improve conditions, opportunities for workers to up-skill and their introduction was inevitable. From an emotional perspective, the machines represented a threat to livelihood, expertise and tradition. The modern changes that automation, cyber and digital transformation bring have the potential to turn a modern workforce into “neo-luddites”.
How can we overcome resistance, and help our teams with big transitions? It is important to note that leadership is especially needed during periods of transition and change. Role-modelling, visibility, clear communication and empathy are vital to the success of any change project.
What do the traditional change models tell us?
The traditional models:
One of the original models for understanding organisational change was developed by Kurt Lewin, a German-American psychologist, known as a pioneer of social, organisational, and applied psychology.
For Lewin, the process of change entails creating the perception that a change is needed, then moving toward the new, desired level of behaviour and finally, solidifying that new behaviour as the norm. Using a block of ice as a metaphor, to change its shape we need to understand the new shape we want to create and what’s keeping the ice in its current state. The next step is to change it by melting it, and the final stage is to re-freeze it into its new shape. Here are some useful questions we need to think about during the three stages:
Kotter's 8-step change model:
This model inspired the work of John Kotter (1996) and his 8-Step Leading Change model:
The Transition Curve:
What about the psychological impact of unexpected or enforced change on the happiness and productivity of our teams? How can we help them through the process so that they feel more engaged and are more likely to embrace the change?
Elizabeth Kubler-Ross (1969) originally developed a 5-stage model to describe the emotional stages of grief. This inspired the work of John M. Fisher (1999, updated 2012) who developed the Personal Transition through change curve.
A simplified updated version of both models is below and breaks down the curve into four stages. It is important to note that time could denote seconds or minutes in the case of a minor change and up to years in the case of a major life change. Another important factor is that this transition is not necessarily linear, it is completely normal to oscillate between the stages.
How leaders can help and enable their staff during change:
What can we conclude from all of these models? It is important to plan and prepare for the psychological impact of change on our teams and staff. Listening, empathy and empowerment are vital parts of the success of the change process.
The other important takeaway is that these are frameworks not rules. Lewin’s unfreeze-refreeze and Kotter’s 8 steps regularly fail when managers use them as a step-by-step tick-box process to enforce change and do not take into account the psychology of their workforce.
In our next article we will go beyond the traditional models and look at the deeper psychology of motivating people through change and how to “build-in” change as opposed to just create “buy-in”.