Sep 28 2018| Leadership | Human Data
by Phil Eyre Founder
Today’s leaders in the Channel Islands and beyond are armed with a wealth of research into employee engagement, motivation and organisational health. According to research by Gallup, businesses scoring in the top quartile for employee engagement are 21% more profitable than their lower quartile peers.
The Leaders team uses much of this research in our work and have come to discover that without organisational health - a critical responsibility of business leaders - engagement will falter.
It is also clear to us that the health of the organisation is sensitive to the motivational health of the leaders. In other words, healthy leaders create healthy workplaces. Toxic leaders do not.
What is corporate health?
Many disciplined years as an investment manager taught me that corporate health includes financial measures; cash flow, liquidity, gearing, earnings, profitability are all important. As is too often discovered after a merger or acquisition, the quality of leadership is also essential. On paper, the numbers may look great, but poor leadership fails to engage people and deliver the promised returns.
A healthy organisation is one in which all decisions and actions are in alignment with the purpose and values of the business. This creates a culture of trust and integrity. Individual egos and silo-agendas are seconded (preferably extinguished) in favour of the mission and objectives of the organisation.
Leaders, therefore, have a critical role to play. If the leaders of the organisation are high in these qualities, the organisation will not be healthy:
Poor in communication
Inconsistency and indecisiveness,
As a consequence, the wider team will not be engaged. The results will flounder.
Interestingly, these are all qualities that can be measured with human data, making these issues identifiable, predictable and therefore solvable. Human data provides us with a crystal ball, able to see problems before they arise.
Low politics is healthy
Healthy organisations are low in politics. The purpose of the business takes priority over the individual, personal desires of the leaders. One CEO described it to me like this, ‘a good director knows when to sack themselves.’
The needs of the business as a whole take priority. This, in turn, allows creativity, constructive feedback and an environment of openness and transparency - these are the hallmarks of a healthy organisation.
Power games = poor health
By comparison, high-ego leaders will position their own agendas above all others. A desire for power and status can lead to decisions that are good for the individual but bad for the business. Playing power games creates an air of distrust, defensive decision making, low feedback and silo mentality as individuals build their own small castles rather than focussing on the greater whole.
Impact case study - balancing out the egos
We recently worked with a leadership team scoring high in measures of ego. Their individualistic drives were high, ‘escape’ skills were elevated, transparency scored low and scores indicating self-interest were high. It didn’t take us long to identify some exceptionally unhealthy behaviours; aggression, deceit, laziness, taking undue credit, blaming others for mistakes to name just a few.
We had to get right back to basics with the leadership team, taking time to build mutual respect, giving some uncomfortable but necessary feedback and creating strategies to consider other peoples’ needs ahead of their own. It will take the organisation some time to recover, but the toxicity has, thankfully, abated.
Clear communication is critical
Clear communication is a hallmark of healthy organisations. Intuitively, we know this to be the case. In all relationships, clear communication makes life better. Unspoken expectations breed frustration and resentment.
Organisations that are clear about their purpose, objectives, values and expectations create the conditions for exceptional performance. Too often, there is a distinct lack of clarity emanating from the C-suite. Sometimes the leaders know what matters but fail to communicate. Sometimes they haven’t agreed their key priorities.
Once again, human data has a part to play in quickly identifying these issues. For example, we make good use of the Quality of Motivation Questionnaire which identifies disclosure resistance, the tendency to self-sabotage and other factors that relate to the quality of communication.
Impact case study - small tweaks make a big difference
An executive client of Leaders scored high in self-sabotage; their communication was frequent but very poorly timed. For example, important staff-wide emails were being sent late on a Friday, with the executive becoming frustrated when people failed to pay attention. Once identified, a series of tactical tweaks made a significant difference in the impact of their communications.
Healthy organisations attend to intrinsic motivation as well as the more typical extrinsic motivators (‘carrot and stick’). Intrinsic motivation includes purpose - the desire to serve something bigger than ourselves; autonomy - the desire to direct our lives and mastery - the desire to get better at something that matters. Fostering intrinsic motivators takes passion and ambition, a concerted long-term effort to stretch forward rather than settling for comfort or minor short-term wins.
Leaders need to be passionate not only to provide the energy to pursue demanding objectives but also to inspire their people. We often equate passion with extroverted behaviours, but this is not the case. Introverts are ambitious and passionate about life and work.
We measure ambition and passion when working with individuals and teams, especially at a senior level. One team we worked with scored high for ambition (good!) but low in positive motivation; candidly they were bored, as their shareholder was suffocating their creative drive. Bored leaders usually make bad decisions - sometimes recklessly. They also demotivate their teams.
High proactivity (focus)
Healthy organisations are focused on their key objectives. All effort is aligned towards agreed and compelling targets, blending financial goals, measures of customer satisfaction, measures of employee satisfaction as well as working towards desirable feelings (‘I am proud to work for this company’). Work and initiatives that do not serve these objectives are dropped.
Unhealthy organisations either have no objectives - everyone is getting along fine doing what they think is useful, but with no guiding principals - or have too many goals creating confusion.
Accountability and agility are crucial skills; deciding with conviction the most desirable objectives and holding self and others to account when working towards them. Effective goal setting, with clear measures and timeframes, are standard in such an organisation. As is the expectation that established processes serve the vision for the business, they are not an end in themselves. Challenge is expected when such a challenge will achieve a better outcome.
Human data once again has a role to play in identifying these qualities. For example, teams that lack curiosity are unlikely to challenge norms. Individuals that are low in resolution skill are unlikely to make clear decisions.
High staff turnover is usually a sign of poor corporate health. Why would anyone want to stay in an unhealthy environment Whilst some turnover is healthy - depending on the organisation 5% to 12% would usually be about right - excess turnover creates instability, as well as high costs.
Whilst our research in this area is still being collected, the early indications are that less-stable leaders create less-stable organisations. Leaders that are more volatile in their expressed behaviour (one day elated, the next agitated), that chop and change plans and initiatives usually end up with high levels of staff turnover. This unpredictability can be predicted when measuring the quality of motivation, role awareness and self-esteem. Whilst all remedies are unique, the common theme in our work often centres around achieving a better balance in life.
Lower employee turnover is one of the most frequently achieved benefits of our work.
Healthy leaders create healthy organisations that in turn deliver healthy returns for all stakeholders.
Our purpose is to help you to achieve this in your business; call us today to find out how; 07781 100351.