A poor company culture is deadly – literally.
Many companies bet on having a cut-throat, high-pressure, take-no-prisoners culture to drive their financial success. There is an assumption that the hard pressing, on-your-back ever present boss speeds up productivity and increases output. Since forever managers have used ‘’fear management’’ as a style to ‘’get things done’’, but organizations fail to recognize this culture has the exact opposite effect, and to prove it, research supports the damages incurred that often go un noticed, and the damages are considerably worse than we realise.
A storm in a teacup
1. ‘’My boss is killing me – literally’’. Firstly, health care costs at high-pressure companies are nearly 50% greater with an estimated 550 million workdays are lost each year due to stress on the job. 60 – 80% of workplace accidents are attributed to stress, and it’s estimated that more than 80% of doctor visits are due to stress. Workplace stress has been linked to health problems ranging from metabolic syndrome to cardiovascular disease. In a large-scale study of over 3,000 employees conducted by Anna Nyberg at the Karolinska Institute, results showed a strong link between leadership behaviour and heart disease in employees. Stress-producing bosses are literally bad for the heart.
2. Second is the cost of disengagement. Research suggests that the inevitable stress of a fear management style will likely lead to disengagement over the long term. And disengagement is costly. In studies by the Queens School of Business and by the Gallup Organization, disengaged workers had 37% higher absenteeism, 49% more accidents, and 60% more errors and defects. In organizations with low employee engagement scores, they experienced 18% lower productivity, 16% lower profitability, 37% lower job growth, and 65% lower share price over time. Importantly, businesses with highly engaged employees enjoyed 100% more job applications.
3. Lack of loyalty is a third cost. Research shows that workplace stress leads to an increase of almost 50% in voluntary turnover. People go on the job market, decline promotions, or resign. And the turnover costs associated with recruiting, training, lowered productivity, lost expertise, and so forth, are significant. The Center for American Progress estimates that replacing a single employee costs approximately 20% of that employee’s salary.
For these reasons, many companies have established a wide variety of perks from working from home to office gyms. However, these companies still fail to take into account the research. A Gallup poll showed that, even when workplaces offered benefits such as flexitime and work-from-home opportunities, engagement predicted wellbeing above and beyond anything else.
Employees prefer workplace wellbeing to material benefits. Wellbeing comes from one place, and one place only — a positive culture.
Creating a positive and healthy culture for your team rests on a few major principles:
• Caring for, being interested in, and maintaining responsibility for colleagues as friends.
• Providing support for one another, including offering kindness and compassion when others are struggling.
• Avoiding blame and forgive mistakes.
• Inspiring one another at work.
• Emphasizing the meaningfulness of the work.
• Treating one another with respect, gratitude, trust, and integrity.
As a boss, how can you foster these principles? The research points to four steps to try:
1. Foster social connections. A large number of empirical studies confirm that positive social connections at work produce highly desirable results. For example, people get sick less often, recover twice as fast from surgery, experience less depression, learn faster and remember longer, tolerate pain and discomfort better, display more mental acuity, and perform better on the job. Conversely, research by Sarah Pressman at the University of California, found that mortality is 70% higher of employees with poor social relationships. Toxic, stress-filled workplaces affect social relationships and, consequently, life expectancy.
2. Show empathy. As a boss, you have a huge impact on how your employees feel. A telling brain-imaging study found that, when employees recalled a boss that had been unkind or un-empathic, they showed increased activation in areas of the brain associated with avoidance and negative emotion while the opposite was true when they recalled an empathic boss. Moreover, Jane Dutton and her colleagues in the CompassionLab at the University of Michigan suggest that leaders who demonstrate compassion toward employees foster individual and collective resilience in challenging times.
3. Go out of your way to help. Jonathan Haidt at New York University’s Stern School of Business shows that when leaders are not just fair but self-sacrificing, their employees are actually moved and inspired to become more loyal and committed themselves. As a consequence, they are more likely to go out of their way to be helpful and friendly to other employees, thus creating a self-reinforcing cycle.
4. Encourage people to talk to you – especially about their problems. Not surprisingly, trusting that the leader has your best interests at heart improves employee performance. Employees feel safe rather than fearful and, as research by Amy Edmondson of Harvard demonstrates in her work on psychological safety, a culture of safety i.e. in which leaders are inclusive, humble, and encourage their staff to speak up or ask for help, leads to better learning and performance outcomes. Rather than creating a culture of fear of negative consequences, feeling safe in the workplace helps encourage the spirit of experimentation so critical for innovation.