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Are you approaching psychological safety from the wrong angle?

Arianna Huffington sums up the great resignation beautifully. ‘The Great Resignation is really a Great Re-evaluation. What people are resigning from is a culture of burnout and broken definition of success…’ Success has often been framed by shareholder value and profits. This mode of thinking doesn’t stack up in today’s environment and this has been dinosaur thinking before the pandemic even began. The pandemic has put the spotlight on the important role that people play. Psychological Safety has been brought front and centre to our attention. Organisations that adopt a people centric approach to everything they do will be the ones that prosper.

Where did shareholder first thinking come from?

Why is success framed by shareholder value and profits? After publication of ‘Theory of the firm’ by Jensen and Meckling in 1976 in the journal of Financial Economics we saw a significant shift to shareholder is king mentality. The authors argued that companies were owned by and responsible to shareholders before anyone else. Shareholder wealth has steadily become more important than employee health. There are two major problems with shareholder first thinking. It leads to a focus on short term results and does not provide any incentive for a focus on corporate social responsibility.

Command and control not fit for purpose!

The command and control approach is characterised by an old thinking traditional management hierarchy where employees do what their boss says because the boss said to do so. Top layers of management dictate to employees what work is needed to be done to achieve business goals and the people actually doing the work are not consulted about how to accomplish the goal.

In February 2022 Newcrest CEO Sandeep Biswas apologized for his autocratic style of leadership and was sorry if anyone felt bullied during their time working at the nation’s biggest gold mine. He stated that he is working to change his leadership style and build a more inclusive culture. He went on to say he now realizes he could have achieved the same good results at the mine with a more inclusive management style than the command and control approach. I think he could have achieved superior results with a more inclusive leadership style. His style of leadership led to high turnover in senior executive positions, and we all know the recruitment costs of rehiring senior executives. Some of the impetus for the intention to move to a more inclusive style of leadership came after Biswas received a ‘cold shower of feedback’. Newcrest uses McKinsey’s OHI survey to measure their management systems and practices and benchmarks them against industry peers. The company started leadership programs in 2019 aimed at introducing a more inclusive style of leadership. In 2019 they scored 73 for the OHI and by 2021 this had dropped 5 points to 68. Other performance figures of note include a rise in injury rates in the first half of the 2022 fiscal year, 20% lower gold production, a 23% increase in all in sustaining cost (ie cost of mining) and a 46% lower basic earnings per share compared with the same period of the previous year. Biswas also announced they would equate psychological safety to physical safety. The links between psychological safety and performance are clear. A Gallup study found that doubling the number of workers who felt psychologically safe generated a 27% reduction in turnover, a 40% reduction in safety incidents and a 12% increase in productivity.

Are companies approaching psychological safety the wrong way?

Whilst I am heartened to see the interest by companies in psychological safety what I am also seeing is that people are seeing it as important but companies are not sure how to build it. What many people don’t understand is that psychological safety is a lead indicator that influences performance, well being, innovation, engagement, mental health, customer experience, psychical safety and in turn the culture of an organisation and business results.

neuroleadership, neuroscience of leadership, psychological safety at work What is also not understood is that there is an ultimate lead indicator which I refer to as ‘social safety’. The fundamental question your brain is making judgements about is ‘am I safe or not safe in this social context?’ This assessment includes both our physical and social safety. We make judgements about our safety by taking in information through our 5 senses, noticing our affect and matching this with past experiences to help us plan our action. When our assessment is that we aren’t safe this activates our flight, fight or freeze response. This all occurs outside of our conscious awareness. Following this judgement about our safety we can them determine and consciously describe how we are feeling ie safe or not safe (referred to as our feeling of psychological safety). We can describe and name what is making us feel psycho-socially safe or not safe. Work is a social context and both leaders and fellow employees influence our judgments about our social safety. neuroscience of leadership, psychological safety at workWe can’t measure social safety easily but we can measure psychological safety. Instead we still see companies measuring engagement and wellbeing. These are lag indicators and if we truly want to build psychologically safe workplaces we need to be measuring lead indicators.

Companies are beginning to wake up to this and are tacking on a few psychological safety questions in their engagement and wellbeing surveys. Instead, I would be suggesting companies start with measuring psychological safety and use tools that give insight into not only levels of team based psychological safety but also provide data to inform what needs to be addressed to lift the needle on psychological safety.

We have also seen many organisations using a silo like approach to trying to influence psychological safety and wellbeing. New positions and areas in organisations have been tasked with improving wellbeing, addressing mental health, improving diversity and inclusion. This silo like approach has led to a reactive, uncoordinated and piecemeal approach to improving psychological safety. Organisations would be much better placed to improve psychological safety if they hit the pause button and develop a comprehensive psychological safety strategy. Perhaps it is also time to bring safety under one umbrella led by a Chief Safety Officer whose remit includes both physical and social safety. This would assist in breaking down the silo approach we see in organisations where there is no coherent approach to improving safety both physical and psycho-social. Whilst we see organisations reporting on their physical safety indicators we rarely see organisations reporting on their psycho-social indicators.

It is time to rethink how we are looking after our greatest asset in our organisations -our people. As Bill Marriot suggests as shown in Marriots’ mission statement – when you look after your people, they will look after our customers and our customers will come back.

Make a time to speak with us about how we can support you to measure psychological safety and build a comprehensive psychological safety strategy.

One Response

  1. This is a great read Linda. As always, you put things into practical perspective.

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