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Leadership expert and author Ram Charan has observed, “In tough times [senior managers] compete for resources by doing things such as hiding information to make themselves look better while blaming their peers in subtle ways. Discussions can degenerate into personal attacks.” (Leadership in the Era of Economic Uncertainty, p. 36.)
Given the high emotions generated by the current economic climate,
SHRM Online decided to focus attention on the question of what leaders can do to build trust in these challenging times and minimize the influence of destructive emotion (particularly,
fear) on employees and on their job performance. The experts who responded outlined a number of helpful measures to build trust and minimize fears in nervous employees including the following:
The experts identified several purposes served by honest communication: It calms fears, reinforces trust in a leader’s integrity and humanity, and allows for emotional support. According to Lee J. Colan, Ph.D., president of The L Group, Inc., a Dallas, Texas-based consulting firm—during hard times, “deeper and more frequent” communication by leadership is necessary to short-circuit the “silence spiral” that can be set in motion by unanswered questions: “Silence leads to doubt; doubt leads to fear; fear leads to panic; panic leads to worst-case thinking.” Colan believes that the four main questions employees want answered in times of crisis are as follows:
Ram Charan warned that there is no doubt that “your integrity and credibility will be tested” as a leader in troubled times. He advised leaders to be “very honest with [their] direct reports,” “develop a viewpoint,” and share their views “about the economy, unemployment—the forces that are causing these stresses.” He also recommended that leaders solicit their employees’ viewpoints, with an attitude of openness and humility because “no one knows what is the real truth.” He promised that leaders who take this approach again and again will build trust.
The advice of John Behr Ph.D.—a corporate psychologist and founder of the John Behr Group, LLC—parallels that of Colan and Charan, with his caution to err on the side of
over-sharing information. Behr acknowledges that such advice runs counter to many leaders’ impulses right now, but noted that over-sharing is far preferable to allowing rumors to run rampant. Behr noted that another byproduct of too little communication (and too much resultant fear) is “survivor guilt” in the employees who remain after companies implement layoffs. Survivor guilt, he said, might spur people who are used to working 50 hour weeks to begin putting in 80 hour weeks because they feel they want to prove their value. But, he suggested, increased output spurred by fear and guilt can lead to burnout. Providing more information about why the “survivors” are still around—expressions of appreciation for their value—can help employees feel more secure that they are needed, Behr said.
The advice of Judith Blanton, Ph.D.—director of professional affairs for RHR International and executive board member of the Society of Industrial Organizational Psychology—qualifies the other experts’ statements, as she notes that trust won’t happen “if your communications appear remote or artificial.” She said that “people need to feel a highly personal presence and connection” and cautioned that “talking about the long-term visions and strategies of the company will not be effective when people are bracing for further bad news or emotionally recovering from previous disclosures.”
Blanton also cited the need to acknowledge employees’ emotions and provide some outlet for emotional support: “On the personal side, leaders need to acknowledge that they, too, are affected. Saying it is no sign of weakness. On the contrary, it signals that they are in touch with their own feelings and with others as fellow human beings. Everyone, including senior executives, may need to seek out support—from friends, family members, mentors, and counselors.” She advised leaders to ensure they provide outlets for employees to support one another: “If and when dramatic events occur, give people opportunities to safely express their emotions. Reach out to employees on a personal basis. Get out of your office and into the hallway. Be there for them.”
Lilli Friedland, Ph.D., A.B.P.P, president of Executive Advisors, agreed, stating “Leaders need to ask their teams to both take care of themselves physically and emotionally (some executives are strongly recommending that their staff engage in going to the gym, meditation and yoga, and time with their families and friends)—maximizing individuals’ well-being and resilience.”
A recent CNN article profiling small business owners’ experiences suggested that—in addition to quelling employee fears and building trust in leadership—greater transparency can also make employees much more conscious of the need to save money and their roles in controlling waste. "I told my employees that we didn't make as much this year,” Ken Villani, president of Cottage Pharmacy in Woodbury, N.Y., said in the CNN piece. “I also told them what the rent costs, what electric costs, and gas costs, etc. Their reaction was 'Oh my God! We had no idea!' In their minds, the money goes into the cash register and then at the end of the week we divvy it out to the employees. They have no sense of what running a business actually costs." In the same piece, Owen Mester, president of O'Wayne New York Enterprises, a bakery in Maspeth, N.Y., added, "Our employees know what the conditions of the business are, and they've become more productive and less wasteful. We're going to come out stronger because of it, which is something we're all looking forward to."
Apart from communicating honestly and openly, the experts recommend a few other measures to be considered for building trust and allaying employee fears and confusion.
Building a “culture of accountability.” Ben Dattner, Ph.D., founder of Dattner Consulting, LLC, noted that leaders need to demonstrate their integrity by “holding themselves accountable” for all of their organizations’ decisions and by not abiding double standards—not having one set of rules for themselves and another for their employees. Similarly, they can demonstrate solidarity by sharing some of the burden of the economic downturn. Dattner cited the example noted by President Barack Obama in his State of the Union address: bank president Leonard Abess, Jr. After selling a majority stake in Miami-based City National Bancshares last November, Abess divvied $60 million of his earnings among all of the bank’s 399 current employees and 72 former employees. Likewise, Dattner noted, in organizations that are publicly traded, “if a leader antes up and buys shares, that’s a powerful signal of confidence.”
According to Jeff Daum, Ph.D., CEO of Competency Management Incorporated, leaders must be wary not only of their own actions and missteps, but those of their employees as well. He noted that “counterproductive efforts of any team member” must be exposed and dealt with in a series of escalating consequences, as needed. If unwanted behavior persisted, he said, it should result “in swift action up to and including removal of the member.” He further noted that “If it is a functioning team, then team members are aware of subterfuge. And when it goes unchecked, the team loses all confidence in the team leader.”
Simplifying processes and protocols. Colan suggested that now may be an especially good time to consider what business systems might be streamlined. He noted that overcomplicated or unclear processes and protocols often lead to unnecessary stress and waste, and he recommended “defining the rules of engagement” to reduce confusion and to encourage focus on performance (instead of getting bogged down in confused, conflict-laden processes). A few fertile areas for creating new “rules of engagement” may include “decision-making,” “sharing information,” “coordinating hand-offs,” “reviewing work,” “prioritizing,” and “resolving conflict.”
As an example of how clarifying “rules of engagement” reduces stress and confusion, Colan cited the “We Card” signs that now appear in every convenience store. In the past, Colan noted, convenience store workers had to visually inspect each customer, trying to guess who might be close to legal age. On the one hand, they risked legal action if they did not check I.D. when they should, but on the other hand, if they did check I.D., they risked customers’ annoyance or hurt feelings. “Today, with the help of ‘We Card’ signs, workers only have to point to the sign,” Colan said. “No fuss, no risks, nothing personal. It’s a rule of engagement that is understood by all parties. Defining the rules of engagement for your team can yield similar benefits. [Rules of engagement] create accepted ways of acting and interacting so your team does not have to think about or debate what is appropriate in each situation.”
Maria Williams is a staff writer for SHRM Online.
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