Volume 38 Issue 1 Organizational Health and Wellness

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The Professional Journal of HRPS

Volume 38 Issue 1

PERSPECTIVES Six Lessons on LeadershipRobert Hogan, Ph.D.

Counterpoints:Dave Winsborough / Robert B. Kaiser / Adrian Furnham / Allan H. Church, Ph.D. / Joshua Ehrlich, Ph.D.

FEATURES

Securing Lasting Value through Organizational Health Michael Bazigos, Ph.D., Aaron De Smet, Ph.D., and Bill Schaninger, Ph.D.

Capturing the Value of Health and Productivity Programs Keith Caver, Thomas O. Davenport, and Steven Nyce

Tone at the Top: Leadership as the Foundation of Organizational Health and Wellness Kathleen T. Ross, Ph.D., and Paul Squires, Ph.D.

The City Awakens to the Challenge of Mental Health Yochanan Altman, Ph.D., Clive Morton, Ph.D., Elizabeth Cotton, Roger Kline, and Michelle Altman

CASE STUDYRegaining Organizational Health and Vitality: Ford Motor Company’s Positive Adaption to the Challenges of the Automotive Industry Crisis Chris Emmons, Ph.D.

Winter 2015Organizational Health and Wellness

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People Strategy&

articles

Volume 38 Issue 1 2015departments

4 From the Executive EditorAnna A. Tavis, Ph.D.

6 From the Special Issue Editor Michael N. Bazigos, Ph.D.

8 Perspectives: Point/CounterpointSix Lessons on LeadershipRobert Hogan, Ph.D.

Counterpoints:Dave Winsborough / Robert B. Kaiser / Adrian Furnham / Allan H. Church, Ph.D. / Joshua Ehrlich, Ph.D.

14 Linking Theory & PracticeDo Sweat the Small Stuff: How Leaders Can Positively Affect Human Well-Being in a Big Way Brad Winn, Ph.D.

18 Research Corner The Healthy Mind Platter: HR’s RoleJacqui Grey

52 Thought Leaders Interview with Dr. W. Warner Burke Michael N. Bazigos, Ph.D.

56 In 1st PersonLeading Healthy Organizations Anna A. Tavis, Ph.D.

60 In 1st PersonHealth and Well-Being at CBREAlison Romney Eyring, Ph.D.

62 Book ReviewsUsing a Positive Lens to Explore Social Change and Organizations: Building a Theoretical and Research Foundation The Advantage: Why Organizational Health Trumps Everything Else in Business

Overworked and Overwhelmed: The Mindfulness Alternative

Securing Lasting Value through Organizational HealthMichael Bazigos, Ph.D., Aaron De Smet, Ph.D., and Bill Schaninger, Ph.D.

Capturing the Value of Health and Productivity Programs Keith Caver, Thomas O. Davenport, and Steven Nyce

Tone at the Top: Leadership as the Foundation of Organizational Health and WellnessKathleen T. Ross, Ph.D., and Paul Squires, Ph.D.

The City Awakens to the Challenge of Mental HealthYochanan Altman, Ph.D., Clive Morton, Ph.D., Elizabeth Cotton, Roger Kline, and Michelle Altman

Regaining Organizational Health and Vitality: Ford Motor Company’s Positive Adaption to the Challenges of the Automotive Industry CrisisChris Emmons, Ph.D.

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2 PEOPLE & STRATEGY

HR People & Strategy is a dynamic association of human resource and business executives committed to improving organizational performance by creating a global network of individuals to function as business partners in the application of strategic human resource man-agement practices.

HRPS continuously seeks to build recognition from business leaders and the HR community for the critical role of HR as a strategic business partner in achieving higher levels of organizational success. In support of this mission, HR People & Strategy:

• Serves as a global forum for presenting the latest thinking and information on the HR implications of key business issues and strategic HR practices.

• Offers a broad range of comprehensive publications and professional development programs with distinguished human resource scholars, practitioners and business leaders.

• Builds networks of diverse individuals to exchange leading-edge HR ideas, information and experiences.

The Five Pillars of Knowledge

The following five knowledge areas are those HR People & Strategy believes are the most critical and strategic to HRM and HR best practices. HR People & Strategy has identified these pillars of knowledge through extensive research on human resources management and organizational development. These five areas drive the content and outcomes of all HRPS educational activities, from conferences to webcasts to content in our People & Strategy journal.

• Build a Strategic HR Function

Enhancing the impact of the profession

• HR Strategy and Planning

Ensuring excellence in human capital management

• Leadership Development

Impacting leadership skills and attitudes individually and collectively

• Organizational Effectiveness

Strengthening the organization’s effectiveness in achieving its intended outcomes

• Talent Management

Securing diverse talent to meet the organization’s future needs at all levels

Executive EditorAnna Tavis, Ph.D.New York University

Associate EditorSteven Hanks, Ph.D. Jon M. Huntsman School of Business at Utah State University

Perspectives EditorMarc Sokol, Ph.D. Sage Consulting Resources

Linking Theory & Practice EditorBrad Winn, Ph.D. Jon M. Huntsman School of Business at Utah State University

Thought Leader EditorSteven Steckler EMD Millipore

Asia Pacific EditorAlison Romney Eyring, Ph.D. Organisation Solutions

European EditorYochanan Altman, Ph.D. BEM – Bordeaux Business School, France

Editors-at-LargeDavid Creelman, M.B.A.Creelman Research

Kathleen Ross, Ph.D. Heathly Companies International

Editors EmeritiEd Gubman, Ph.D.Strategic Talent Solutions Joseph McCann, Ph.D. The Conference Board

Richard Vosburgh, Ph.D. RMV Solutions

HRPS Executive CommitteeChair of the BoardEdie Goldberg, Ph.D. E.L. Goldberg & Associates

Vice Chair of the BoardRichard Vosburgh, Ph.D. RMV Solutions

TreasurerSimon King Bristol-Myers Squibb

SecretaryCathy Malaer UniGroup

HRPS HeadquartersExecutive Director Lisa Connell

Managing EditorMary Barnes

The People & Strategy journal (ISSN 1946 4606) is published quarterly by HR People & Strategy.1800 Duke StreetAlexandria, VA 22314888-602-3270

©Copyright 2015 HRPS. All rights reserved. Permission must be obtained from HRPS to reproduce any article in any form by any means, electronic or otherwise, including photocopy, record-ing, or any information storage and retrieval system. To obtain reprint rights, visit www.copyright.com.

People & Strategy SubscriptionDigital Only: Provides access to the latest four (4) journals in digital format. Current members: included as part of annual dues; affiliate members: $49.95; libraries and academic profes-sionals: $69.95; nonmembers: $99.95.

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CorrespondenceAddress editorial inquiries to: Anna A. Tavis HRPS—People & Strategy 1800 Duke Street Alexandria, VA 22314 Email: [email protected]

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4 PEOPLE & STRATEGY

from the executive editor

science and research, it is now an established organizational practice—one that has begun to matter even more as we have learned how to measure it and show for it through data and analysis that supports our business case.

Furthermore, we have reached the tipping point where all of the good research and years of discovery are turning into bona fide prac-tices and gaining long overdue recognition and acceptance in the strategic practitioner ranks.

It took a village to bring this special issue to fruition. We invited the Organizational Health Solution Practice at McKinsey & Co. to part-ner with us in exploring this topic together. Not only did our collaboration help us shine the spotlight on the tools, accumulated evi-dence, and science they have brought to the discussion, but they also showcased the solu-tions grounded in McKinsey’s own daily experience in working with companies who are looking to improve their organization health solution practice to help them effect positive change. What mattered to us most was

Just as millions of glasses were being raised to welcome in a successful, prosperous, and healthy New Year, at People &Strategy

we were putting the finishing touches on the Winter 2015 issue focused on organizational health and wellness. We set out to design a special “health” volume timing it for the moment of year’s renewal. We felt strongly about the priority of the topic bringing atten-tion to the paradigm shift that is under way in our organizations. Well-being, mindfulness, and health in the workplace are those hidden dimensions in the complex makeup of compa-nies that are now finally getting the spotlight they deserve.

What we present in these pages is a lineup of feature articles, a selection of point and coun-terpoint discussions, thought and practice leader interviews, and case studies on the topic of organizational health and wellness. All of our authors demonstrate persuasively that organizational health focus is no longer a pass-ing fad, nor a revolution, but rather a logical part of organizational transformation. From

To Your Health! that as collaborators, we shared the same pas-sion and conviction about the importance of the message we were crafting together.

We are plentifully aware as the ink is drying off this journal’s pages that as with all New Year’s resolutions, this one might not be as easy and seamless to follow through on. It may go the way of other year’s start wishes. In fact, we realize that these new year commitments classically demonstrate how change does not happen overnight. This one, we trust, is here to stay. The number of companies joining the movement, embracing the new science, and refreshing their world outlook is growing every day. With this issue of the People and Strategy journal, we welcome the trend and extend the invitation to our members and to our readers to join in the movement.

Dr. Anna A. Tavis

In MemoriamJames W. (Jim) Walker

June 24, 1941–September 28, 2014Founder, HR People & Strategy

James W. Walker, Ph.D., founder of HR People & Strategy (formerly the Human Resource Planning Society) was a leading consultant, speaker, and author on HR strategy and workforce management, leader of the

Walker Group HR consultancy, and former vice president of Towers Perrin’s HR planning consulting practice. He authored several books, including Human Resource Planning, Human Resource Strategy, The End of Mandatory Retirement, and Work Wanted: Protect Your Retirement Plans in Uncertain Times.

Jim was passionate about initiating discussions, funding research, sharing knowledge, and authoring and reading publications that emphasized the strategic element of HRM. He was a visionary and intellectual pioneer in the fi eld of HR who recognized the paradigm shift that was taking place in the fi eld before it occurred. Jim provided inspiration and sage advice to friends and colleagues—many of whom he mentored over the years. He will be dearly missed, but always remembered for the lasting legacy he leaves on our profession.

View individual tributes online at the HR People & Strategy group page on LinkedIn.com.

VOLUME 38/ISSUE 1 — 2015 5

6 PEOPLE & STRATEGY

but they are also happening and crystallizing a new expectation for the role: business relevance. In our experience, there are many capable HR leaders who get it, and are quite adept. (There are also some who do not, and aren’t.) Chris Gagnon, a solution partner at McKinsey reminds us of that in his first-person interview with executive editor Anna Tavis (p. 56).

Client experience, and the first-person interview with Professor Warner Burke of Columbia Uni-versity Teachers College (p. 52), tell us that the proverbial “seat at the table,” once earned, is only as valuable as the respect HR leaders earn through relevance in the form of strategic change skills, evidence-based persuasion, and value-based ideas and initiatives.

Done well, impact with the senior team and the enterprise is sure to follow.

Dr. Michael N. Bazigos

Organizational Health and Wellness Are Business Relevant

from the special issue editor

What is the evidence that organizational health helped Ford Motor Company turn itself around? A case study mined more than 160 structured interviews with managers and employees illus-trates how Ford captured the value of organizational health. Their road from near-bankruptcy to profit leadership in the automotive industry is told in Regaining Organizational Health and Vitality: Ford Motor Company’s Positive Adaption to the Challenges of the Auto-motive Industry Crisis (p. 46).

What is the evidence that holistic well-being is related to leadership effectiveness and the engagement of employees? Tone at the Top: Leadership as a Foundation of Organizational Health and Wellness (p. 36) subjects Gallup’s and Healthy Company’s datasets of 360-degree ratings of leaders to multivariate statistical treat-ments (communicated in plain English) to make the case.

What is the evidence that employers can derive more value from their health and wellness pro-grams—and how much? Data from three Towers Watson surveys is mined to address these questions in Capturing the Value of Health and Productivity Programs (p. 30).

The bottom line for CHROs and other readers in policy roles is that value propositions that make sense to line leaders are not only possible,

T he invitation to compile and edit this issue arrived unexpectedly during a visit to Google’s New York City offices

on a Friday afternoon in 2013. Brian Welle, director of people analytics at Google and a member of a local organization of I-O Psychol-ogists (the Friday Group), was hosting a visit. He had presented Google’s initiatives to “nudge” people into living longer. For my part, I had shared a few words about McKinsey’s Organi-zational Health Index business. Perhaps coincidentally, perhaps not, Anna Tavis, execu-tive editor of the People & Strategy journal (and a Friday Group colleague), floated the idea of publishing a special issue of this journal focusing on organizational health and wellness.

This issue is the result.

One core belief informed the call for papers: Organizations need to measure and manage their health with the same rigor they apply to performance. Consequently, readers will find evidence of, well, evidence throughout the majority of our feature articles and in our lead Perspectives, Six Lessons on Leadership (p. 8), by Bob Hogan.

Another core belief informed the special editor’s decisions: Organizational health is one of the most powerful levers leaders have to drive per-formance in the short term and set up the organization for long-term success. Evidence abounds throughout—from the estimated $1.2 billion advantage in long-term shareholder value creation for the healthiest companies to the estimated $1,600 per employee advantage in health care savings for superior wellness ini-tiatives, excluding other benefits, e.g., reduced sick days and health risks.

What is the evidence that organizational health is related to company performance? Securing Last-ing Value through Organizational Health (p. 24 ) links McKinsey & Company’s Organizational Health Index scores from hundreds of companies and millions of respondents to nine-year total return to shareholders (TRS) and key perfor-mance indicators (KPIs) that companies actually use to run their businesses, like production costs.


8 PEOPLE & STRATEGY

I am obsessed with the topic of leadership. Orga-nizations need leaders to make key decisions, anticipate and manage changing market trends, and set strategic vision. When competent leader-ship prevails, people and companies prosper. Bad leadership almost always gives rise to disengaged workers, corporate chicanery, and, eventually, business failure.

The problem with most leadership compe-tency models is they fail to distinguish between successful managers—people who are rapidly

promoted in their organizations—and effec-tive managers—people whose subordinates are committed and whose organizational units perform well. If we distinguish between these groups and review the leadership literature from the perspective of team effectiveness, we find six useful generalizations.

1. What Followers Want from Their Leaders

The first concerns the characteristics that

people want to see in their leaders. Kouzes and Posner (2010) devised a simple paradigm for studying this: Ask people to describe the best and the worst managers they have ever had using a standardized format. This research reveals that people evaluate leaders in terms of four broad categories:

Integrity. Followers want to know that the people in charge won’t take advantage of their positions—they won’t lie, steal, play favorites, or betray their subordinates.

perspectives – point

Editor’s IntroductionMarc Sokol, Perspectives Editor

Imagine a string that connects the CEO of your company to every employee in the field, and the way that string is pulled is somehow felt by every single employee. Now imagine that the executive team and even the leaders a level below also touch that string and have their own impact on employees.

This will be helpful if the string vibrates in the right way, sending clear messages that drive productive and healthy behavior. It can also be confusing, even damaging, if the messages are inconsistent or counterproductive.

All of which assumes the CEO and other leaders actually know when they are tugging on the string and what messages they are conveying with their actions.

Robert Hogan, author of our lead Perspective, Six Lessons on Leadership, is one of the world’s foremost authorities on that string that connects leaders to the rest of the organization. His research and its practical application have helped articulate the value chain of executive personality and information processing, leading to engagement and business unit performance. Ultimate-ly, this connects to organizational health and wellness—or the lack thereof.

To amplify and expand on Dr. Hogan’s perspective, we invited commentary from five other thought leaders:

Dave Winsborough highlights attributes of leaders who mark dysfunction and eventual peril for followers. If you can recognize them, steer clear of these types of leaders.

Rob Kaiser writes about the contrast of attributes that help some ascend to executive roles versus a different set of attributes that reflect leaders’ real effectiveness. Can you spot the difference among your executives?

Adrian Furnham takes issue with the assertion that leaders can drive positive and negative engagement, as there exists a different set of factors underlying each.

If the first three commentaries are cautionary about leaders and their impact, the next two are optimistic.

Allan Church describes how one global firm helps its leaders leverage awareness of personal tendencies and provides a process to help their behavior not be dominated by the presence or absence of particular tendencies.

Joshua Ehrlich closes the set, arguing that through mindful self-acceptance leaders actually can manage their own personal ten-dencies and in the process contribute to wellness in the workplace.

If you believe leaders can impact the health and wellness of the workplace, then this installment of Perspectives is for you. After reading the lead Perspective and the commentaries that follow, you can contact any of the authors directly, or let me know how you are addressing leadership and organizational health in your company. —Marc Sokol

Marc can be reached at [email protected].

Six Lessons on LeadershipRobert Hogan, Ph.D.


perspectives – point

Judgment. The success or failure of organiza-tions depends on decision-making. Some leaders make better decisions than others.

Competence. To be competent in the team’s business, good leaders seem to know what they are talking about. Subordinates see lead-ers who lack business acumen as empty suits, and are unwilling to follow them.

Vision. Good leaders can explain how their mission fits into the larger scheme of things. This vision clarifies roles, goals, and the way forward, thereby facilitating team perfor-mance.

These four themes emerge in descending order—with integrity being the most impor-tant attribute and vision the least impor-tant—but all four are crucial components of leaders’ reputations. Conversely, leaders who lack integrity, good judgment, competence, and vision will surely fail.

2. Personality Predicts LeadershipThe second lesson concerns personality and leadership. The data are clear: Personality is the best single predictor of leader perfor-mance that we have. For example, Jim Collins published a milestone study of 11 Fortune 1000 companies that had 15 years of below average performance, followed by a transi-tion year, and then 15 years of performance substantially above their industry average.

Collins found that in each case a new CEO had turned the company around and that these 11 highly effective CEOs combined extreme personal humility with a fierce and relentless drive to win. This contrasts with their high-profile, publicity-seeking counter-parts in poorer performing companies. While personality is important in both cases, we can also reject the view that CEOs need charisma to be effective.

3. Leadership Drives Engagement; Engagement Drives PerformanceThe third lesson concerns leadership and employee engagement. Engagement is “…a persistent psychological state associated with behaviors that are beneficial to an organization” (Macey & Schneider, 2008). In major separate studies, Huselid (1995) and

Harter, Schmidt, and Hayes (2002) show that: a) managers’ behavior predicts employ-ee engagement; and b) employee engagement predicts business-unit performance. Engage-ment is a function of how people are treated by managers. Specifically, the quality of the relationship between leaders and followers creates engagement.

4. Leaders Drive Financial PerformanceThe fourth lesson concerns the financial con-sequences of good and bad leadership perfor-mance. Collins’ research shows that well-led companies are more profitable than those with average leadership. Although the esti-mates vary from 14 percent to 40 percent, several studies conclude that CEOs account for a significant proportion of variance in the financial performance of large organizations.

5. There Are More Bad Leaders than Good OnesThe fifth lesson concerns managerial incom-petence. In another milestone paper, Bentz (1967; 1985) reported on a 30-year study of managers at Sears. His research showed that the failure rate for managers in American business is substantially higher than expect-

ed. How many bad managers are there? We identified 12 published estimates of the fre-quency of management failure, which range from 30 percent to 67 percent, with an aver-age of about 50 percent. Note that these esti-mates concern the number of managers who are actually fired. I believe that about two-thirds of existing managers are ineffective, but fewer than half will be caught because they are good at internal politics. The misery that bad managers create for their staff has consequences on morale. About 75 percent of working adults say the most stressful aspect of their jobs is their immediate boss.

6. Bad Managers Lead from the Dark Side

Finally, bad managerial behavior originates in the dark side of personality. As Bentz (1967) noted, most managers fail for the same rea-sons: emotional immaturity, arrogance, micro-management, dishonesty, indecisiveness, poor communication skills, and so forth. Hogan and Hogan (2001) proposed a taxonomy of the most common counterproductive manage-rial behaviors. Although the behavior patterns are different, they have the same effect on employees: They erode trust, increase stress, and degrade performance.

10 PEOPLE & STRATEGY

perspectives – counterpoint

The foregoing discussion leads to the ques-tion, “What is the profile of an ideal leader?” I start with Peter Drucker’s observation that leadership is really about followership, that leadership should be understood in the con-text of what the followers expect from their leaders. The points presented above suggest that followers want to see six characteristics in their leaders–—integrity, good judgment, competence, vision, humility, and fierce ambi-tion for collective success—and those charac-teristics provide a guide to an optimal assessment profile.

Dr. Robert Hogan defied decades of conventional wisdom and academic tradition by proving that personality predicts performance. Thirty years later, Dr. Hogan’s theories on personal-ity and leadership continue to chal-lenge mainstream thinking and have been adopted by some of the largest and most successful companies in the world. He can be reached at [email protected].

ReferencesKouzes, J.M., & Posner, B.Z. (2010). The Truth About Leadership: The No-Fads, Heart-Of-The-Matter Facts You Need to Know. San Francisco, CA: Jossey–Bass.

Macey, W. H. and Schneider, B. (2008). The meaning of employee engagement. Industrial and Organizational Psy-chology, 1: 3–30. doi: 10.1111/j.1754-9434.2007.0002.

Delaney, John T. and Huselid, Mark A., The impact of human resource management practices on perceptions of organizational performance. The Academy of Manage-ment Journal, Vol. 39, No. 4 (Aug., 1996), pp. 949–969.

Harter, J. K., Schmidt, F. L., & Hayes, T. L. (2002). Busi-ness-unit-level relationship between employee satisfaction, employee engagement, and business outcomes: A meta-analysis. Journal of Applied Psychology, 87(2), 268–279.

Bentz, V. J. (1967). The Sears experience in the investiga-tion, description, and prediction of executive behavior. In F. R. Wickert & D. E. McFarland (Eds.), Measuring Exec-utive Effectiveness (pp. 147–205). New York: Appleton-Century-Crofts.

Hogan, R. and Hogan, J. (2001), Assessing leadership: A view from the dark side. International Journal of Selection and Assessment, 9: 40–51. doi: 10.1111/1468-2389.00162.

Getting Leadership Back to Its Purpose: And It’s Not About You, CupcakeDave Winsborough

Bob Hogan is obsessed with leadership, and has done more than most to highlight the idea that the person in charge is profoundly con-sequential to the well-being and lives of those who follow. The characteristics of integrity, judgment, competence, vision, humility, and ambition he describes have a timeless quality to them.

As they should, for Hogan’s thinking is rooted in evolutionary biology and locates the importance of each element in our profoundly group-oriented nature. Humans live in groups, and there is always a status hierarchy in the group; being closer to the top of that hierarchy confers greater rewards, be they food, money, sex, or attention.

This also means that followers always hold out hope that the people who climb to the top will have their interests at heart, be compe-tent, and behave benevolently towards them. Sadly, the evidence in human society shows that good leadership and occupying the top job are simply not one and the same. There is no shortage of self-aggrandizing leaders who prove to be inept or corrupt, or both. A partial list might include Robert Mugabe, Bashar al-Assad, Kim Jong-un, Robert Fuld, Carly Fio-rina, and Bernie Ebbers. If you notice a trend in the list, it’s very likely causal: recent exper-imental work by John Antoniakis1 shows that access to power and testosterone interact and lead to corruption, even among individuals who are otherwise honest.

Consider descriptions of the bad and incompetent against Hogan’s list. Barbara Kel-laway describes “rigid,” “intemperate,” “callous,” “corrupt,” and “insular” as mark-ers. Sidney Finklestein describes “dominant,” “over-identified,” “overconfident,” “ruthless,” “slick,” and “tried-and-true.” Don’t these look

a lot like the opposite pole of the features described by Hogan?

But there is a conundrum: While few would argue with the list, how does anyone who does not embody the attributes described by Hogan make it into a leadership role? This is a real, practical, and consequential question.

There are five classes of problems when it comes to leadership.

First, the hierarchical nature of human soci-ety means subordinates defer to leaders. That is, they create distance around them, tend to provide only good news, and tell them what they like to hear.

Second, many of the traits that seem attractive when one is young and showing potential can ossify or become overused when the reins of power are handed over.

Third, evidence suggests that leaders tend to hire in their own image—and some firms like Goldman Sachs are obsessive about ensuring the fit is very tight.

Fourth, the study and practice of leadership and leader development are premised on a tautology—by studying only those in charge, the picture that emerges is going to look a lot like the people who are already in charge.

Finally, leadership has become an end in itself. Our obsession with leadership inside compa-nies typically means that leaders are trained as individuals in a pampered and often expen-sive manner. As Rob Kaiser has pointed out, the nearly $15 billion spent on leadership training and development hasn’t impacted trust in leaders as measured by the Harris Poll. Leadership seems decoupled from its biologically determined purpose—to act as a resource for the good of the group.

So a plea to the readers of this journal: Use the six characteristics that Hogan outlines only as a screen, a selection tool, and an ongo-ing index of suitability as you choose leaders for your own enterprise.

Reference1Bendahan, S., et al., Leader corruption depends on power and testosterone, The Leadership Quarterly (2014), http://dx.doi.org/10.1016/j.leaqua.2014.07.010.



That’s because they represent two distinct—and sometimes conflicting—motivations: self-interest and collective interest. Unfortu-nately, self-interest usually trumps the collec-tive interest.

It is unfortunate for two big reasons. First, it means that most people who aspire to posi-tions of leadership do so for self-interested aims: the compensation, status, and prestige of upper management. The welfare of employees and the performance of the organization may only be an afterthought, if they are given any serious thought at all. Second is the irony that their selfish behavior is unlikely to bring them satisfaction. Spiritual teachings from the Bud-dha to the Bible emphasize that the best way to be happy is to make other people happy. And indeed, empirical research shows that doing good for others, investing in them, and helping them to succeed leads to greater personal satisfaction (Dunn, Aknin, & Nor-ton, 2008).

If managers are to create a healthier work-place, they must start by looking within, at their motivation for aspiring to a position of leadership. If they are more driven by the trappings of status and other self-gratifying desires, then you can expect little benefit to workplace health. Those who seek to serve a greater good are the ones more likely to create the kind of culture that takes care of people and performance. And in a karmic turn of justice, those same managers are likely to achieve a greater sense of fulfillment and peace of mind for themselves.

ReferencesDunn, E.W., Aknin, L. B., & Norton, M. I. (2008). Spend-ing money on others promotes happiness. Science, 319, 1687–1688.

Luthans, F., Hodgets, R.M. & Rosenkrantz, S. A. (1988). Real Managers. Cambridge, MA: Ballinger.

Rob Kaiser is president of Kaiser Leader-ship Solutions, a provider of cutting-edge tools for the assessment and develop-ment of leaders, and the editor of Con-sulting Psychology Journal: Practice and Research. He can be reached at [email protected].

Dave Winsborough is managing direc-tor of Winsborough Limited, a leading New Zealand consultancy. An expert on leadership at the top of organiza-tions, he is recognized for his skills in building high-performance senior-level teams. He can be reached at [email protected].

Leaders Must Look Within to Create a Healthy WorkplaceRobert B. Kaiser

In his characteristically incisive and iconoclas-tic way, Robert Hogan has cut through the hype and hoopla to get to the heart of what we know about effective leadership. His secret is to turn the leadership equation around by starting with the people being led.

From this view, Hogan makes a crucial distinc-tion: the difference between successful manag-ers (who get ahead in their careers) and effective managers (whose people are engaged and get great results). We’d like to think that effective managers are also those who get ahead, but this is not normally the case.

Research on the topic suggests that only about one in 10 managers are both effective and successful (Luthans, Hodgetts, & Rosen-krantz, 1988). Look around at the people at the top of most organizations and consider which qualities best describe them: 1) good at self-promotion, well-connected, and polit-ically astute, or 2) able to bring out the best in others, influential at getting people to set aside their personal agendas and work together, and utterly committed to the vision.

The first set of qualities is table stakes: With-out them, you aren’t likely to get very far. But having them does not mean you will have the second set of qualities. In fact, the more a manager emphasizes the first set, the less likely he or she is to emphasize the second set.

Leaders Can Drive Disengagement, But Not EngagementAdrian Furnham

Bob Hogan is a courageous academic and clear thinker, willing to go against the tide when he believes the consensus is flawed. He helped “resurrect” personality theory in the 1980s and ’90s and has made a major contribution to understanding leadership derailment.

Few academics can claim to have started a highly successful, international, multimillion dollar company based on sound research findings. He is a “one off” and should, I believe, be seen as a “national treasure” for American psychology.

One of the great attractions of reading or hearing Bob is seeing him cut through the Gordian knot of tangled theories or research findings. He has a knack for getting to the heart of the issue, which he always summa-rizes in a few memorable points. He has done this in his “Six Lessons” piece, which is classic Hogan.

While I agree with points one, five, and six, and would commend anyone to read his work on the dark side, I take issue with point three, that leaders drive engagement, and engagement drives performance. In past pre-sentations, Hogan has noted the change in concept from job satisfaction to involvement to commitment and then to engagement, which seems the new flavor of the month. Despite the enthusiasm for the concept and claims, the evidence remains weak. There is both an absence of evidence and evidence of an absence with regard to the idea that lead-ers (alone) drive engagement, which (alone) drives performance.

In even the best studies and sound meta-analyses, the size of the correlations suggests that a manager’s ability, personality, and motivation does relate to performance, but that the correlations are low (typically around r=.2).



Too many things drive performance; I prefer the idea that leaders drive disengagement. This is a bit like the Herzberg two-factor theory, in which the factors that drive satis-faction are not simply the opposite of those that drive dissatisfaction. Similarly, the oppo-site of engagement is not disengagement. They are different processes. We observe that leaders can quickly and dramatically cause staff disengagement on their own. The drivers of sustained engagement, however, are broad-er than the pull, presence, actions, or any leader just on his or her own.

Leveraging Personality to Develop Leaders and the Organization Allan H. Church, Ph.D.

We are all obsessed with leadership. As talent management (TM) professionals, our man-date is to ensure our organizations have a holistic talent development strategy and set of supporting processes, practices, and tools to achieve the company’s business objectives. One of the most critical components of this mandate is to identify and secure (whether through a buy or build model) the right level of leadership to effectively run the business today and meet the succession goals for the future. Thus, for many of us in TM, the key distinction we need to make with respect to leadership competencies is, “do they reflect the success profile of today or those capa-bilities required for the future?”

Balancing Leadership Development with Organization DevelopmentOne of the most effective ways to achieve these goals is by blending the best-of-the-best

Allan H. Church, Ph.D., is vice presi-dent, OD Global Groups and Execu-tive Assessment at PepsiCo. He can be reached at [email protected].

theories, frameworks, and interventions from different professional disciplines, including industrial-organizational psychology and organization development. Organizations need to ground their talent and leadership succession efforts in:

• Understanding leaders in the pipeline and differentiating them around their individ-ual skills and capabilities, which includes personality

• Enhancing self-awareness and knowledge of the cultural impact of personality char-acteristics and leadership behaviors on em-ployee outcomes such as engagement, com-mitment, and performance

The first leads us to enhance the talent management agenda via formal assessment and the identification of high-potentials. The second leads us to support an organization development agenda via feedback and coaching interventions. Achieving this dual emphasis and balance on differentiation and develop-ment is critical to having an effective and holis-tic approach to leadership development.

What Works at PepsiCoAt PepsiCo, our approach to talent manage-ment and employee development reinforces this dual emphasis. In general, it is aligned with Bob Hogan’s observations, and we have fully integrated both the bright and dark sides of personality along with values orientation within our formal multi-tier assessment and development efforts. Devel-oped and launched in 2010, the Leadership Assessment & Development program (LeAD) provides increasingly intensive inte-grated assessment and development efforts that are linked to key leadership transitions and targeted at individuals in certain career stages or levels in the organization. The sys-tem leverages a multi-trait, multi-method model beginning at lower levels in the orga-nization, with “Checkpoint-0” designed to assess early indicators of potential. This is followed by higher checkpoints (1, 2, 3) which go successively deeper in the assess-ment process and are supported by higher levels of development “touch” and individ-ual planning support from internal I-O psy-chologists with expertise in this area.

One of the most critical aspects of the LeAD framework is that it is rooted in the Leader-ship Potential BluePrint (Church & Silzer, 2014), which includes personality as one of the two key foundational aspects of defining a high-potential leader. Based on the model, we integrate personality measures at every level of our assessment and development efforts (from early identification to senior levels). This step is critical when giving one-on-one feedback to participants because it helps us ensure our leaders have a complete picture of their personality characteristics and how these influence their behaviors as measured through 360-degree feedback (i.e., ratings from their direct reports, peers, and managers).

Interestingly enough, we have found that the participants’ personality dispositions are reflected in other aspects of the program, including areas such as attention to detail on our custom simulations, executive presence in critical incident interviews, and even com-pliance with timelines and various deliver-ables related to the process in general.

As a consequence, when delivering feedback, our internal team in the assessment and devel-opment Center of Excellence almost always starts with the personality tool, given that so many other aspects are influenced by how leaders perceive their world. In sum, we would argue that personality is a founda-tional component of both effective leader-ship—and future leadership potential—and that enhancing managerial self-awareness is a key means to achieving one’s potential.

ReferencesChurch, A., and Silzer, R. Going behind the corporate curtain with a blueprint for leadership potential: An inte-grated framework for identifying high-potential talent. People & Strategy. Volume 36, Issue 4. 2014.

Adrian Furnham, Ph.D., is a professor of psychology at University College, Lon-don, and the author of more than 1,000 scientific papers and 75 books. He can be reached at [email protected].


Mindful Self-Acceptance: The Heart of Healthy LeadersJoshua Ehrlich, Ph.D.

Leaders perform well when they feel good about themselves. Few are able to do so, though, because they try to grow from the outside in (building self-esteem) instead of from the inside out (cultivating self-acceptance).

Building Self-Esteem vs. Self-AcceptanceSociety teaches us to build self-esteem from:

• Stuff (“I have a lot of money.”)

• Approval (“I get recognition.”)

• Accomplishment (“I am winning.”)

• Fantasy (“I am great!”)

Yet this only makes leaders vulnerable to market forces, which are inevitably uncon-trollable and take away these sources of false satisfaction. We add to this by telling leaders they are never good enough (“You saved the company $40M this year? Great. Next year save $50M.”) The result is battle-weary lead-ers who reveal their immaturity and survive by depending on their dark side.

Contrast this with ways we can develop self-acceptance:

• Alignment (“I am in sync with my values and purpose.”)

• Self-regulation (“I can manage emotional ups and downs.”)

• Facing reality (“I can look myself in the mirror.”)

• Self-support (“I can treat myself with kind-ness instead of self-criticism.”)

These factors are intrinsic and controllable, and when we lead from this basis we are ener-gized and passionate. Self-acceptance does not lead to self-indulgence, complacency, or arro-gance. It enables us to be open to feedback and care about our impact. It helps leaders build true self-confidence and to demonstrate integ-rity, humility, and stability.

Look around your organization for a moment and ask yourself, would you prefer to follow leaders who try to build their self-esteem or leaders who work at developing their self-acceptance?

The Benefits of Mindful Self-AcceptanceMindfulness is present, open, and engaged attention with a quality of kindness and warmth towards oneself. We can develop self-acceptance by teaching leaders to be mindful in six areas:

• Body. Paying attention to physical health, especially exercise, diet, and sleep.

• Mind. Learning to stay focused and setting boundaries to ensure time to think.

• Emotion. Cultivating gratitude, empathy, and positivity.

• Spirit. Staying connected to sources of meaning, values, and purpose.

• Connecting. Giving and getting support to form strong, lasting relationships.

• Inspiring. Energizing others with your vision and passion.

Research on the benefits of mindfulness con-tinues to mount in the same six areas (Wallace & Shapiro, 2006; Langer, 2009; Davis & Hayes, 2012). Benefits include:

• Body. Lower stress, fatigue, burnout; high-er immune response, life expectancy, resil-ience, and energy.

• Mind. Enhanced focus, job performance, accuracy, clarity, flexibility, objectivity, per-spective, learning, memory, creativity, and problem solving.

• Emotion. Higher empathy, stability, positiv-ity, psychological and moral maturity; toler-ance for anxiety, ambiguity, and uncertainty.

• Spirit. Increased motivation, engagement, empowerment, career development, job and life satisfaction; customer loyalty; de-creased absenteeism and theft.

• Connecting. Improved listening and empa-thizing, clearer communication and stron-ger relationships; employee retention.

• Inspiring. Increased innovation, new product development, sales, quality performance, leadership presence, and attractiveness.

Companies such as Google, BlackRock, and McKinsey are teaching mindfulness as both a wellness and a productivity tool. Human resources professionals can create mindful envi-ronments by leveraging performance manage-ment, engagement, recruiting, and assessment processes. And leaders can build mindful teams by establishing simple routines, such as exchang-ing the breathless back-to-back 60-minute meeting schedule for a 45-minute norm.

At the heart of healthy companies are healthy leaders. We can grow healthy leaders from the inside out, not only by treating them well, but by teaching them to treat themselves well.

ReferencesDavis, D. and Hayes, J. What are the benefits of mindful-ness? Monitor on Psychology. American Psychological Association July 2012, Vol. 43, No. 7, page 64.

Langer, E. Counterclockwise. (2009) Ballantine Books; 1 edition (May 19, 2009)

Wallace, B. Alan, and Shauna L. Shapiro. Mental balance and well-being: Building bridges between Buddhism and western psychology. American Psychologist 61 (2006): 690-701.

Joshua Ehrlich, Ph.D., founded the Glob-al Leadership Council, an international network of experts in mindful leadership and organizational transformation. He is the author of Mindshifting: Focus for Performance. He can be reached at [email protected].



In this issue of People & Strategy, we review a recent study published in the Academy of Management Journal by Joyce Bono and The-resa Glomb, et al. Their research focuses on how, in the context of getting the big stuff right, relatively small interventions and events in everyday work life can have a sig-ni� cant impact on the wellbeing of employ-ees, both in terms of their emotional wellbe-ing and their physical health. I had the good fortune of interviewing Drs. Joyce Bono and Theresa Glomb and asked them speci� cally about implications of their research for HR leaders and for bottom-line health care costs. Several insights based on their experience in organizations and their research are espe-cially relevant for practice in the world of work.

What I learned from Professors Bono and Glomb is that our immediate work environ-ment and the small events that happen to us day in and day out may affect whether our workday is awful, okay, or joyful. While macro-organizational dynamics that occur outside of our immediate departments have an indirect effect, what we experience most closely is what happens to us in our own smaller work environment. What happens between you, your direct supervisor, and your close coworkers creates the actual climate around you that either drains you or builds you up. That is, the little things that supervi-sors do and other events that happen every day affect the way you feel. These everyday events can cause you to feel happy, frustrated, or can potentially result in making you phys-ically sick.

We all know of cases where workers’ interac-tions with their supervisors have had a nega-tive effect on them. Employees can become overwhelmed, discouraged, and generally experience the effect of work bringing them down. These types of work events and inter-actions happen not only with supervisors, but

with coworkers, clients, customers, and oth-ers. Yet, we are also aware of work environ-ments and events that are enlivening, moti-vating, and enriching. Work events are a set of activities that can either deplete or replen-ish employees’ resources.

This brings us to the conservation of resourc-es model (Hobfoll, 1989), summarized in Bono and Glomb, et al.’s research publication as follows:

employees to produce at all costs. In some companies, people are thought of as a resource to be used up. In these organizations, manag-ers are pushed to ensure that employees are completely spent when they leave work. Employees end up giving their all but feeling drained.

On the other hand, there are organizations that treat people as human beings rather than human resources. These types of organiza-

Do Sweat the Small Stuff: How Leaders Can Positively Affect Human Well-Being in a Big WayRecent Academic Research on People and StrategyBy Bradley A. Winn

“T he central notion of the model is that humans strive to protect and enhance the self through the acquisition and maintenance of resources. When environmental conditions deplete or threaten resources, people suffer increased stress, and when environmental conditions provide or build resources, people enjoy better health and reduced stress.”

The literature is replete with examples of work environments that deplete employee resources. This feeling of being depleted can come from organizations that demand

tions recognize that people spend a signi� cant part of their life at work. Managers recognize that employees want to do a good job, care about the quality of their work, and want to accomplish the business goals that are before them. In these work environments human beings are thought of as people who are working with you rather than resources to be used up. Most people want to do a good job, but sometimes organizations prevent them from doing their best work. It is the micro-culture in the local department and the events that happen in proximity that make the most


Results

Results suggest that both naturally occurring positive work events and the positive refl ec-tion interventions are associated with reduced stress and improved health. The intervention affected participants’ stress levels, health, and wellbeing in a significant and meaningful way.

Discussion and Conclusion

This section includes the key points of the study’s conclusions. Bono and Glomb, et al. begin their discussion with the following:

“Studs Terkel opened his classic book Work-ing with these lines: ‘This book, being about work, is, by its very nature about violence—to the spirit as well as to the body. It is about ulcers as well as accidents, about shouting matches as well as fi stfi ghts, about nervous breakdowns as well as kicking the dog around. It is, above all (or beneath all), about daily humiliations’ (1972: xiii). This punish-ing view of work serves as the basis for much existing research on employee stress, but our research suggests that daily work comprises more than pain and suffering…our results suggest that—even if only in small ways—positive daily experiences at work such as socializing, positive feedback, and goal accomplishment relate directly to reduced stress and improved health…In Working, Ter-kel also suggested the promise of positive experiences: ‘It [work] is about a search, too, for daily meaning as well as daily bread, for recognition as well as cash, for astonishment rather than torpor; in short, for a sort of life rather than a Monday through Friday sort of dying’ (1972: xiii).”

In our search for meaning at work, those positive and negative daily events that hap-pen close around us and to us impact our emotional and physical health. How we refl ect upon our daily events also affects our health and wellbeing. These results have implications for leaders and managers. Supervisors should think carefully about how they interact with their employees, especially on the positive/negative balance of feedback. Employees should be told what they are doing wrong, but supervisors should not for-get to give praise, compliments, and recogni-tion when warranted. This will not only help employees feel better emotionally, but will help them feel better physically and be health-

being: mastery, a purposeful life, quality interpersonal connections, and positive self-regard. According to the conservation of resources model, workplace events that build or enhance these features should enhance core resources and combat stress. For exam-ple, accomplishing a task might enhance a sense of mastery, and fun interactions with coworkers might highlight social resources.”

Given the importance of employees recogniz-ing positive workplace events, what might organizations do to overcome the “bad is stronger than good” phenomenon? Our researchers turned to the positive psychology literature which suggests that even small and somewhat simple interventions can, under certain circumstances, help employees over-come this natural negative bias and make a difference in employees’ health and wellbe-ing. Based on these assumptions and the theories discussed, this study looks at the effects of everyday work events as well as a simple positive reflection intervention on employees’ stress and physical health.

Purpose The purpose of the study was to determine if naturally occurring positive and negative workplace events affect employee stress and health, and to determine if a small positive refl ection intervention (refl ecting on positive events at the end of a workday) also affects employee stress and health.

MethodsThe study included approximately 60 par-ticipants and the methods are detailed in the research article as follows:

“Each day, participants (a) reported work events and stress through four PDA surveys at work, (b) wore ambulatory blood pressure monitors that automatically measured their blood pressure…and (c) answered questions about their current stress and health during the evening phone interview. At the midpoint of the three-week study, we introduced an additional task: at the end of each workday…participants performed a daily positive refl ec-tion exercise….Participants worked in nine outpatient family practice clinics operated by two health care organizations in a large met-ropolitan area….Participants recorded three good things that had happened that day (per-sonal or work-related) and explained why they thought these events had occurred...”

difference in how employees feel at the end of the day.

This brings us to the broaden-and-build theory, summarized in Bono and Glomb, et al.’s research publication as follows:

“Much of the research on positive events and experiences has emerged from positive psy-chology and its foundational broaden-and-build theory (Fredrickson, 1998 & 2001), which explicitly addresses positive experi-ences and emotions as they enhance health and flourishing. Taking an evolutionary approach, Fredrickson argued that in con-trast to negative emotions, which narrow a person’s thought and action repertoires in preparation for quick action (e.g., to fi ght off

an imminent threat), positive emotions broaden people’s thought and action reper-toires, allowing them to consider more expansive ideas, actions, or solutions.”

Negative events have a more poignant effect than positive events on the human psyche, perhaps because we have learned that sur-vival may be at risk if we don’t pay attention to a hot stove or honking car. Humans natu-rally tend to focus on and remember negative events more than positive ones. This means that even a work day that is fairly balanced between positive and negative events may be perceived as a bad day unless the employee consciously refl ects on the actual events. On the other hand, employees need positive events to be able to fully contribute in broad and creative ways. Bono and Glomb, et. al state:

“Positive events may directly build psycho-logical resources by fulfi lling basic human needs, including belongingness and autono-my (Baumeister & Leary, 1995; Ryan & Deci, 2000). In an effort to defi ne positive human health as something more than a sense of ill-ness or disease, Ryff and Singer (1998) iden-tified four core universal features of well-

If we’re focusing on the negative only, then we’re leaving opportunity on the table.


ier when they go home from work. Normally when supervisors conduct a debriefi ng, they ask what went wrong. While this is necessary, it may not be suffi cient. If we are concerned about worker wellbeing, we might also ask what went well. We might find out where employees made a difference or anticipated and resolved a potential problem.

Managers might focus on helping people feel a sense of accomplishment at work. They can ask employees what they need to do their jobs well and then try to fi nd ways to give employ-ees those resources. Managers should look for opportunities to give employees positive feedback when they do their jobs well.

As leaders, we should create times where we can all pause and refl ect. Find time to stop and savor the positive moments that we had in our

successes. Leaders should take very seriously the notion that what they do in the everyday small interactions can affect the health and wellbeing of employees—and their ability to accomplish their goals.

Implications for HR LeadersWe are hard-wired to attend the negative, therefore we need to balance and consciously focus on the positive. There is a growing body of evidence showing that the little things that happen to people during the day have a sig-nifi cant effect on their health and wellbeing and their ability to contribute effectively and creatively. Ultimately, the bottom line can be benefited by positive events and positive reflection interventions, especially if your company has a sincere overarching goal of

they want to accomplish, and we need to rec-ognize how we might support them with positive experiences. By focusing on fostering positive experiences and ways to refl ect on those events, we engage in the important, but sometimes overlooked, work of sweating the small stuff.

Ultimately, in the experience of human beings in the workplace, it’s not always just about our big organizational levers or strategic cor-porate policies—it’s about how work gets played out in a person’s immediate work environment from the time they walk in the door in the morning until the time they walk out the door at night. Leaders should sweat the small stuff and watch how it positively affects both human and organizational well-being in a big way.

ReferencesBono, J., Glomb, T., Shen, W., Kim, E., Koch, A. (2013). “Building positive resources: Effects of positive events and positive refl ections on work stress and health.” Academy of Management Journal, Volume 56, No. 6, pp. 1601–1627.

Baumeister, R. & Leary, M. (1995). “The need to belong: Desire for interpersonal attachmnets as a fundamental human motivation. Psychological Bulletin, 117: 497–529.

Fredrickson, B. (1998). “What good are positive emo-tions?” Review of General Psychology, 2: 300–319.

Fredrickson, B. (2001). “The role of positive emotions in positive psychology: The broaden-and-build theory of positive emotions. American Psychologist, 56: 218–226.

Hobfol, S. (1989). “Conservation of resources: A new attempt at conceptualizing stress.” American Psychologist, Volume 44, pp. 513–524.

Ryan, R. & Deci, E. (2000). Self-determination theory and the facilitation of intrinsic motivation, social development, and wellbeing. American Psychologist, 9: 1–28.

Ryff, C. & Singer, B. (1998). The contours of positive human health. Psychological Inquiry, 9: 1–28.

Terkel, S. (1972). Working. New York: Pantheon.

There is a growing body of evidence showing that the little things that happen to people during the day have a signifi cant effect on their health and wellbeing and their ability to contribute effectively and creatively.

work. In a natural way ask, ‘why did this go well?’ If we ask why something went well it gives us an opportunity to focus on an accom-plishment, pay a compliment, and recognize a positive difference that was made, even in a small way. Ultimately, this leads to increaseed overall health and wellbeing for employees. As people become healthier, many benefi ts occur, including a reduction in health care costs.

A Word of CautionOne should not assume that an organization can habitually treat its employees poorly and then hope to make things better by engaging in a positive refl ection exercise for 10 minutes at the end of each day. If a company’s overall culture is one of treating its employees as resources to be used up and then tries to implement “positivity,” it will be viewed as a manipulative tactic. Supervisors should “sweat the small stuff,” but only in an authen-tic manner. They should only do this in the context of genuinely caring about the welfare of their employees, thinking every day about how they can help employees accomplish great things and celebrate with them in their

creating a healthy workplace. Employees treated as human beings are healthier and more productive. This is better for them, for your customers, and for your products.

Dr. Bono reminds us that “the core ideas are a) little things that happen to you throughout the work day (positive and negative) have a serious impact on your health and well-being; b) these behaviors might just happen, but they can also be controlled by supervisors and managers; and most importantly; c) by focusing people’s attention on the good things you can enhance their natural benefi ts (that is, good things increase health, but an explic-it focus on good things further enhances health). Thus, it is important in organizations that people have positive experiences and that there be opportunities to refl ect on them.”

HR professionals should consider including this as a basic component of supervisory training programs. Supervisors can con-sciously think of ways to provide balance to overcome the natural evolutionary negative bias. If we’re focusing on the negative only, then we’re leaving opportunity on the table. People come to work with hopes for what

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Our 2014 Global Workforce Study reveals that most employees, including top performers, cite the relationship with their manager as a key reason to stay with an organization. Yet only slightly more than half of employees report their manager is effective at differentiating between high and low performers.

To enable superior manager performance, equip your managers with the skills necessary to attract, engage and retain top talent. Start now by defining the competencies they need to excel using the manager-effectiveness drivers identified in our study.

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Research Corner

The Healthy Mind Platter: HR’s RoleJacqui Grey

focus is just one of the seven aspects of a healthy and balanced daily mental diet. The brain needs much more than just focus time for it to thrive.

How the Healthy Mind Platter WorksThe Healthy Mind Platter proposes seven daily activities for optimal brain health:

• Sleep time

• Play time

• Time in (meditation or reflective practice)

• Downtime

• Connecting time

• Physical time

• Focus time

A deficit in one or more of these essential elements can be a significant contributor to challenges that present themselves at work. But sufficient time spent on each of these can lead to a substantial benefit to performance.

Seven Essential Neurocognitive Activities Sleep Time: Recharges Mind and Body, Consolidates Memory

Horta Osorio was diagnosed with extreme fatigue. He could not sleep at night. “I’d go to bed exhausted but could not sleep. I could not switch off. I understand now why they use sleep deprivation to torture prisoners” (Grierson, 2012). His pay has been reported at £13 million. Some would say “top execu-tives are paid to take it” (Wachman, 2011).

Can we really have top executives underper-forming due to lack of sleep, regardless of how much they’re paid? Aren’t these very people—the big decision makers—who ought to be particularly responsible for maintaining

The Healthy Mind Platter proposes that there are seven types of activities that optimize brain health. These seven complementary activities provide a well-balanced “mental diet” for optimal neurocognitive functioning. By following them, stress levels can fall and performance improve. Rock and colleagues derived the seven staples of a healthy mental diet from a review of basic research in neuro-science and psychology and proposed specific actions each person can take to lever-age those lessons from research. In this article, we take the original proposal and, drawing on case study and practitioner experience, apply it to the corporate context. We address what organizations can do today to maintain employees’ peak mental performance.

A Healthier Mental Workplace Modern work environments and pressures are making it harder for people to take care of their mental capacities, even while increas-ing the need to do so. The concept of “downtime” is very different to what it once was, with little time for integration of new insights and experience. The relentless sched-ule of meeting after meeting leaves no time for reflection. And even when we schedule time away, we take our laptops and tablets on holiday and check them 24/7, even those of us who know from experience that it impacts our wellbeing.

Perhaps most telling is that just about every leader, including in HR, reports doing his or her planning work, or tasks that require focus, in the evenings or on weekends. This is a smart choice, because the construct of work in large organizations is not brain friendly. It is probably no accident that most of us have our best insights when we are not working, but instead at the gym or in the shower, or some-where besides the pressures of our work environment.

The social pressures of most work environ-ments demand focus all day long. However,

Antonio Horta Osorio, CEO of Lloyds Group, was forced to take a leave of absence for “extreme fatigue,” caus-

ing a 7.5 percent drop in the bank’s market value overnight (Enrich, 2011).

This is one of the most clear-cut cases of the business value of a healthy and balanced life and mind. But on a more common scale, the consequences of a healthy mind are often overlooked. Until now, many organizations have viewed wellness and stress relief pro-grams as “nice to have” rather than strategically important.

However, companies that have invested in such programs have found meaningful pay-offs for business—in the forms of reduced absenteeism, strengthened leadership, enhanced organizational performance, and increased savings. For example, Johnson & Johnson reduced health care costs, attribut-ing a saving of $250 million over six years. The return was $2.71 for every dollar spent (Berry, 2010). The estimated cost of sickness absence in the U.S. is $576 billion (Japsen, 2012) and in the U.K. the firm Pricewater-houseCoopers estimates it at £29 billion ($45.6 billion) (Stevens, 2013). Multiply this globally and the numbers ought to be grab-bing the attention of every business leader.

Achieving Mental FitnessIt is not always clear to HR leaders which wellness programs will bring a return on investment (ROI), nor which principles they should follow to support a healthier and lower stress workplace. The Healthy Mind Platter (Rock, Siegel, Poelmans, & Payne, 2012) provides clarity, explaining why vari-ous types of mental activities matter for health and wellbeing, from a neuroscience perspective, pointing toward a set of actions HR leaders can take, and revealing how those actions can lead to extraordinary perfor-mance.


a healthy mind? It is their behavior and deci-sions that trickle down.

Although exhaustion often comes with the executive job, the impact of sleep deprivation on cognitive performance and decision mak-ing is enormous and the resulting effect on employee and organizational performance is a worrying consequence. What about the people further down the food chain that are similarly challenged? The same principles hold for them as well.

Several studies show how sleep—a highly active neurological state important for mem-ory consolidation, semantic integration, learning, and emotional regulation—if suppressed, will negatively impact cognitive and emotional processing during wakeful-ness (Durmer & Dinges, 2005; Gais & Born, 2004; Tassi et al., 2006). Research suggests that the average person needs eight hours of sleep per night, and yet a 2008 National Sleep Foundation poll found that 44 percent of respondents get less than seven (“Sleep in America Poll,” 2008). Additionally, 29 per-cent reported falling asleep or feeling excessively tired while at work. Considering the standard workday structure, sleep depri-vation can be detrimental to successful job performance.

“Power napping” holds potential for improv-ing workplace practices and individual functioning. A 10-minute nap yields great benefits in alertness and general performance lasting up to three hours after waking (Brooks & Lack, 2006). It may even help with cogni-tion and emotion regulation more generally. Providing sleep areas for short rests may result in better mental clarity and better pro-ductivity overall.

Play Time: Joyful Experimenting

Play is not the antithesis to work. Play serves an important role in establishing relation-ships and developing adaptive social behavior, allowing us to test out and therefore better understand different roles and power posi-tions (Panksepp & Burgdorf, 2003).

Play stimulates learning as it allows us to experiment with and practice motor and social skills while simultaneously arousing the mental state of play–joy that is important for creativity (new connections) and memory (lasting connections). It creates engagement between employees and organizations.

Google, eBay, and Oakley have long under-

stood this, setting up rooms for their employees to play games and generally “hang out.” However, what is good for hip Califor-nian techies may not be for serious financial city types. HR professionals can add value to identifying what is appropriate culturally in terms of allocating time and space for joyful experimenting. Play simply needs to stimu-late pleasure, creativity, and laughter. This facilitates people bringing their most innova-tive minds to work because it gives them the opportunity to try new things and make new connections without risk.

Downtime: Integration and Insight

Downtime activity intentionally has no pre-defined goal. It may seem contrary to working efficiently, but this is scientifically erroneous. Downtime is a necessary precursor of insight in complex decision-making.

Deloitte Partner, John Binns, set up a program to combat stress, led by trained Deloitte part-ners. Choosing to take downtime is now a part of life at Deloitte. “Looking back, the symptoms were clear: I couldn’t make simple decisions, such as who to call into the office for a routine meeting, or where to start in replying to emails—I was getting at least 200 a day. I wasn’t sleeping, my energy levels were low, I was losing weight. Everything seemed pointless” (Wachman, 2011).

In today’s demanding multi-media environ-ments, downtime feels like a luxury. But

leaders must learn to value downtime as essential, and implement downtime with their team. One enlightened senior executive actively warns his employees not to pick up emails on holiday because he wants them to have a complete break. The German auto-maker Daimler has introduced an optional software for employees to use on holiday that auto-deletes any incoming emails. The pro-gram is called “Mail on Holiday,” and it issues a reply to the sender indicating the person is out of the office and the email will be deleted, while also offering the contact information of another employee for pressing matters. “The idea behind it is to give people a break and let them rest,” says Daimler spokesman Oliver Wihofszki. “Then they can come back to work with a fresh spirit, not to mention an empty inbox” (Gibson, 2014).

Downtime is an inactive state of wakeful rest during which our brains activate integration, the process of connecting previously uncon-nected information. This integration process often precedes insight, an essential element of high-level cognitive performance. Many deci-sions depend on complex and ever-changing factors for which the sole use of focused, analytical methods is insufficient. For those who lack the opportunity or the time to con-sciously deliberate every issue presented to them, regular breaks are needed to passively sort and integrate thoughts and permit more intuitive, sudden insights to emerge.

Insight has been defined as a “sudden compre-


Research Corner

practice sessions and arrange work routines that are brain friendly.

Hosting mindfulness seminars and even orga-nizing shared moments of mindfulness at the start or end of each day or week can bring the benefits of time-in into an organization.

Connecting Time: The Power of Relationships

Social support affects stressors and strains at work in three ways: It reduces the intensity of experienced strains, adjusts how stressors are perceived, and moderates the relationship between the two (Viswesvaran, Sanchez, & Fisher, 1999). The comfort of knowing that others are available to offer us help and emo-tional support also buffers the negative effects of stress on health.

Over the past two decades, my colleagues and I have created a new kind of science: social cognitive neuroscience. Using tools like fMRI (functional magnetic resonance imaging), we have made startling discoveries about how the brain responds to the social world. Our brains are wired to connect with other people. Given the fact that our brains treat social and physical pain similarly, should we as a society

treat social pain differently than we do? We don’t expect someone with a broken leg to “just get over it,” and yet when it comes to the pain of social loss, this is a common response (Lieberman, 2013).

Increasingly, people are working in more fragmented ways: people work from home and “hot desks;” global teams require more teleconferences. While these are efficient practices, it is important to compensate for the lack of social interaction. An atmosphere of social connection within the workplace can not only boost health and morale among individuals, but it can also unite those indi-viduals with a sense of belonging, togetherness, and motivation. HR can organize events dur-ing and after work hours that encourage connection and play.

Physical Time: The Benefits of Exercise on the Brain

The complexity of abstract problems and an interconnected world require staff at every level to be flexible, innovative, and focused. We need fit brains as well as fit bodies; it is as important to cross-train one as it is for the other. In addition to enhancing learning and memory (Rogers, Meyer, & Mortel, 1990;

The Top 12 HR Deliverables The HR role in creating a more brain healthy organization may be summarized into three areas of focus:

Strategic thinking:

• Prepare the business case.

• Ask for top level sponsorship.

• Join strategic HR networks for ideas.

• Review HR policies to make them more brain friendly and less subject to bias, i.e., performance management, unconscious bias, and recruitment.

• Training

• Provide brain training.

• Provide mindfulness training and regular practice sessions (read what others are doing to help convince the cynical).

• Organize events and allocate budget to brain healthy activities.

• Make training programs and meetings brain friendly—maximum 90 minute sessions with break out time and time for reflection and integration of new ideas.

• Environment

• Encourage focus time—review office layout, provide quiet

areas for focused work where people can’t be distracted.

• Provide a gym or gym memberships at reduced prices.

• Provide pods for “power naps.”

• Provide play areas suited to the culture—table tennis, games, refreshment, and activity areas.

To get these changes to really take hold, it is important that people in the organization know that these resources are available and the use of them is encouraged.

hension that can result in a new interpretation of a situation and that can point to the solution to a problem” (Sternberg & Davidson, 1995). This “suddenness” is actually the result of unconscious integration. During downtime, when we take a break from the effortful, atten-tive activity of problem-solving, we find solutions often emerge on their own.

Companies interested in optimizing employ-ees’ mental capacities should provide breaks for downtime during the working day, and proper holidays should be mandated.

Time-In: Reflective Awareness

Time-in is time devoted to attending to only the events of the here and now (Massion, Teas, Hebert, Wertheimer, & Kabat-Zinn, 1995). Time-in develops the capacity to be present with experience, which as a regular practice is associated with greater develop-ment in areas of the brain related to attention and emotion regulation (Lazar et al., 2005; Luders, Narr, Thompson, & Toga, 2009).

During time-in, we focus on process as opposed to content (Perez-De-Albeniz & Holmes, 2000). Time-in practiced on a regu-lar basis benefits us cognitively (e.g. attention, flexible perspective), emotionally (e.g. self-control, stress management), and socially (e.g. compassion, empathy) while yielding physiological balance.

Google regularly runs Search Inside Yourself training and has a mindfulness guru. Execu-tive Bill Duane credits mindfulness training with improving his personal and professional life, helping him to better deal with stress, handle his emotions, and cope with the death of his father—as well as being more effective at work. “My typical coping strategies—the bourbon and cheeseburger method—weren’t working.” He now focuses full-time on bring-ing meditation to a wider audience at Google. Twitter and Facebook also run mindfulness


Suominen-Troyer, Davis, Ismail, & Salvendy, 1986; van Praag, 2008), exercise improves our “executive functions,” including our abilities to properly select between appropriate and inappropriate behavior and to maintain focus amid distraction (e.g. Davis et al., 2007).

HR professionals can benefit greatly from implementing wellness programs that include exercise as well as the other six activities described. The issue is often a cultural one, however. People must feel with certainty that it is okay to take an hour out to exercise sev-eral times a week, and it is especially important for top executives to lead by example.

Focus Time: Attention Management

Focus time refers to time spent spotlighting our attention on complex work as well as nurturing efficacy, mastery, and completion. When we focus, we enable our brains to hold information in mind and make choices as thoughts occur; focusing gets tasks done.

Attention requires a state of optimal arousal, neither under-stimulated (bored) nor over-stimulated (stressed). To achieve this state we must feel a sense of control and predictability. Asking questions that assess an individual’s sense of stimulation can help gauge this.

One of the major threats to focus is having too many competing tasks demanding our attention. We aim to address this challenge often by multitasking. But multitasking is known to diminish cognitive performance (as discussed in Rock et al., 2012). To minimize the negative consequences of competing demands within one’s organization, employ-ees should be trained to harness their focus by breaking tasks up such that they can men-tally attend to only one task at a time.

Realistically, 21st century workplaces are not brain friendly and are not conducive to focus-ing. To make better focus possible, we have to counterintuitively allow time for the seven elements of the Healthy Mind Platter. That will facilitate the full use of people’s working memory and executive function.

Adopting the Healthy Mind PlatterHR professionals seeking to implement the Healthy Mind Platter in their organizations need to look at it from three angles: the orga-nization, multilevel leadership, and the policies that support best practices. Adopting the framework comprehensively to effec-tively alter workplace culture will take time and financial investment, as well as a change of mindset at the top.

To incorporate the Healthy Mind Platter frame-work, HR will need to prepare a business case based on ROI that addresses the following:

• How much is lost per annum through sick leave

• Case studies of when poor decision- making due to lack of wellness had major consequences

Examples of ROI in Other CompaniesWith sponsorship and participation from the executives, HR should encourage leaders to

adopt a healthy balance of the seven states of activity for six weeks. This is a long enough period of time to embed new neural wiring, create new habits, and to invest time encourag-ing others to do the same.

Most employee programs only deal with middle management down. Top leaders tend to handle exhaustion and stress outside of the organization and look for one-to-one coach-ing to improve performance because they feel they should be able to cope perfectly with whatever work throws at them. This is due to a dangerous stigma surrounding these issues that must be extinguished. It is time for top leaders to acknowledge the recipe for a healthy brain as the same recipe for top per-formance and stress reduction.

Leaders must model positive behaviors to give “permission” for employees to do the same. Going to the gym during work hours demon-strates that it is okay to look after one’s self as part of an overall healthy lifestyle. Similarly, not having the “open door” policy that is so often recommended is likely to produce more brain friendly focus of attention.

Realizing Full PotentialThe Healthy Mind Platter is designed to guide us through the seven activities neces-sary to optimize the mental wellbeing and decision-making capability in organizations. Adopting the Healthy Mind Platter as an organizational framework will improve brain health, creativity, and performance of leaders and subordinates alike. Although we have introduced the different factors constituting

Downtime is a necessary precursor of insight in complex decision-making. … Leaders must learn to value downtime as essential, and implement downtime with their team.


Research Corner

Japsen, B. (2012). U.S. workforce illness costs $576B annually from sick days to workers compensation. Forbes. http://www.forbes.com/sites/brucejapsen/2012/09/12/ u-s-workforce-illness-costs-576b-annually-from-sick-days-to-workers-compensation/

Lazar, S., Kerr, C., Wasserman, R., Gray, J., Greve, D., Tread-way, M., Fischl, B. (2005). Meditation experience is associated with increased cortical thickness. Neuroreport, 16(17), 1893.

Lieberman, M.D. (2013). Social: Why our brains are wired to connect: OUP Oxford.

Luders, E., Narr, K., Thompson, P., & Toga, A. (2009). Neuroanatomical correlates of intelligence. Intelligence, 37(2), 156–163.

Massion, A.O., Teas, J., Hebert, J.R., Wertheimer, M.D., & Kabat-Zinn, J. (1995). Meditation, melatonin and breast/prostate cancer: Hypothesis and preliminary data. Medi-cal Hypotheses, 44(1), 39.

Panksepp, J., & Burgdorf, J. (2003). “Laughing” rats and the evolutionary antecedents of human joy? Physiology & Behavior, 79(3), 533–547.

Perez-De-Albeniz, A., & Holmes, J. (2000). Meditation: Concepts, effects and uses in therapy. International Jour-nal of Psychotherapy, 5(1), 49–58.

Rock, D., Siegel, D., Poelmans, S., & Payne, J. (2012). The Healthy Mind Platter. The NeuroLeadership Journal, 4, 1-23.

Rogers, R., Meyer, J., & Mortel, K. (1990). After reaching retirement age physical activity sustains cerebral perfusion and cognition. Journal of the American Geriatrics Society, 38(2), 123–128.

Sleep in America Poll. (2008). National Sleep Foundation, from http://sleepfoundation.org/sites/default/files/2008 POLL SOF.PDF.

Sternberg, R., & Davidson, J. (Eds.). (1995). The Nature of Insight. Cambridge, MA: The MIT Press.

Stevens, M. (2013). Rising sick bill ‘costs UK business £29bn a year.’ CIPD. http://www.cipd.co.uk/pm/

Jacqui Grey, Ph.D., is managing director–Europe for the Neuroleader-ship Institute. Her career spans law, HR (previously FVP EMEA for Merrill Lynch), executive coaching, and change consultancy. She is known for her work on innovative leadership programs and board-level executive mentoring. She can be reached at [email protected].

peoplemanagement/b/weblog/archive/2013/07/15/rising-sick-bill-costs-uk-business-163-29bn-a-year.aspx.

Suominen-Troyer, S., Davis, K., Ismail, A.H., & Salvendy, G. (1986). Impact of physical fitness on strategy develop-ment in decision-making tasks. Perceptual and Motor Skills, 62, 71–77.

Tassi, P., Bonnefond, A., Engasser, Op., Hoeft, A., Eschen-lauer, R., & Muzet, A. (2006). EEG spectral power and cognitive performance during sleep inertia: the effect of normal sleep duration and partial sleep deprivation. Physiology & Behavior, 87(1), 177–184.

van Praag, H. (2008). Neurogenesis and exercise: past and future directions. Neuromolecular Medicine, 10(2), 128–140.

Viswesvaran, C., Sanchez, J., & Fisher, J. (1999). The role of social support in the process of work stress: A meta-analysis. Journal of Vocational Behavior, 54(2), 314–334.

Wachman, R. (2011). Tough times at the top as high-flying senior executives take time off for stress. The Guardian. http://www.theguardian.com/society/2011/nov/06/execu-tives-stress-work-life-balance.

the Healthy Mind Platter individually, they are deeply interrelated and connected. Together, the seven elements have relation-ships to mental health, creativity, and cognitive performance.

The Healthy Mind Platter illustrates an all-inclusive mental wellness plan and can serve large organizations as a guide to understand-ing what employees and leaders need to do to realize their fullest potential.

References Andrews, J.. PwC, Rising sick bills costs UK businesses £29bn a year. Chartered Institute of Personnel Develop-ment (CIPD) online, July 15, 2013.

Berry, L. (2010). What’s the Hard Return on Employee Wellness Programs? From https://hbr.org/2010/12/whats-the-hard-return-on-employee-wellness-programs.

Brooks, A. & Lack, L. (2006). A brief afternoon nap fol-lowing nocturnal sleep restriction: Which nap duration is most recuperative? Sleep, 29(6), 831–840.

Davis, C., Tomporowski, P.., Boyle, C., Waller, J., Miller, P., Naglieri, J. & Gregoski, M. (2007). Effects of aerobic exercise on overweight children’s cognitive functioning: Arandomized controlled trial. Research Quarterly for Exercise and Sport, 78(5), 510–519.

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Gais, S, & Born, J. (2004). Declarative memory consolida-tion: mechanisms acting during human sleep. Learning & Memory, 11(6), 679-685.

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Grierson, J. (2012). Lloyds boss Antonio Horta- Osorio returns after absence. The Independent. http://www.independent.co.uk/news/business/news/lloyds-boss-antonio-hortaosorio-returns-after-absence-6287230.html.



Securing Lasting Value through Organizational HealthBy Michael Bazigos, Ph.D., Aaron De Smet, Ph.D., and Bill Schaninger, Ph.D.

Business leaders frequently tell us that “one-shot” initiatives—like cost- cutt ing and share buybacks—

frequently result in benefits of limited size, scope, or duration. Chasing benchmarks and best-practice gap closure has not proved to deliver on their expectations, either.

Improving organizational health is one of the most powerful levers a company can pull. Healthy companies generate total returns to shareholders triple those of unhealthy ones and achieve meaningful gains in the specific operational and financial metrics by which they manage their businesses.

Recipes for Success

Companies that consistently outperform their peers typically follow one of four dis-tinct organizational “recipes,” each charac-terized by a distinct set of management practices. Leaders should identify the one that most closely matches their strategic aspi-rations. The trick then is to be truly great in a handful of practices rather than trying to master them all, while avoiding “recipe killers.”

For the past decade, we’ve been conducting research, writing, and working with compa-nies on the topic of organizational health. Our work indicates that the health of an organization is based on its ability to align around a clear vision, strategy, and culture; to execute with excellence; and to renew the organization’s focus over time by responding to market trends. Health also has a hard edge: Indeed, we’ve come to define it as the capacity

Four distinct “recipes” emerge from new research which finds that the performance payoff from

organizational health exceeds expectations, and suggests clear routes to achieve it.

to deliver—over the long term—superior financial and operating performance.

In previous articles and books, such as Beyond Performance,1 we (and others) have shown that when companies manage with an equal eye to performance and health, they more than double the probability of outper-forming their competitors. Our latest research, at more than 950 organizations around the world, revealed several new twists:

• We found that the linkage between health and performance—at both the corporate and subunit level—is much clearer and much larger than we had previously thought. With the benefit of more data and a finer lens, we discovered that from 2003 (when we began collecting data on health) to 2011, healthy companies generated total returns to shareholders (TRS) three times higher than those of unhealthy ones.

• We subsequently found this that this link-age applies to industries, too. In three specific industries we examined in 2014—banking, pharmaceuticals, and retail—long-term TRS ratios of healthy companies were more than triple, double, and 1.6 times higher, respectively, than their unhealthy industry peers.

• We further discovered that companies consistently outperforming their peers fol-lowed one of four distinct organizational “recipes.” We had already recognized these patterns but hadn’t understood their strong correlation with health, operation-al success, and financial performance.

• We also uncovered a practical alternative to the common (but too often disappoint-ing) approach of seeking to improve cor-porate health by closing every benchmark and best-practice gap. More tailored ini-tiatives that combine efforts to stamp out “broken” practices while building signa-ture strengths not only are more realistic but also increase the probability of build-ing a healthy organization by a factor of five to 10.

In short, we’re more convinced than ever that sustained organizational health is one of the most powerful assets a company can build. We’re also clearer on how to achieve it, including the pitfalls to avoid on the road. We hope this is welcome news to leaders worried about the long term, who frequently com-plain to us that the benefits of their one-off reorganization initiatives are ephemeral.2

When we have done this with similar units—such as factories, processing units, and regions—in a given company, we have fre-quently found a strong correlation between organizational health (as measured by our survey) and the unit’s financial or operating performance.

For example, when we established health scores at 16 refineries in the same energy group, we noted a sharp linear relationship between those scores and each refinery’s per-formance as defined by gross profit per unit of output. Health explained 54 percent of the variation in the units’ profits.

In the insurance industry, we found similar results when we compared 11 claims-


processing sites. In this case, we found a strong correlation between health (as defined by the site-specific summary score) and performance (defined as a carrier’s specific proprietary amalgamated metric across indemnity, expense, and customer-satisfaction metrics). Health differences explained about one-third of the variation in performance.3 This is a sig-nificant number, since the remaining two-thirds includes known determinants of performance, such as competition, macroeco-nomic forces, and local-market dynamics (we did not evaluate the relative importance of these forces, which, unlike organizational health, leaders cannot control).

After replicating these findings across many clients and industries, we began to wonder about the strength of the health effect. Could health possibly explain performance varia-tions across companies, industries, and geographies?

When we compared the health metrics of more than 270 publicly traded companies4 with their financial-performance metrics, we found that the healthiest generated total returns to shareholders that were three times higher than those of companies in the bottom quartile and more than 60 percent higher

than those of companies with “middle-of-the-road” health profiles. We have not yet iso-lated the specific health effect for the sample as a whole, but judged by the energy and insurance-company examples, it is likely to be substantial.

Management Practices Matter

The most interesting findings, though, came when we looked more closely at the healthiest organizations in our database. Obviously, all had high health scores as measured by the nine outcomes of health.

But when we delved deeper and looked at the 37 practices that management teams focus on to deliver those outcomes, we discovered that four combinations of practices, or “recipes,” were associated with sustained success. Indeed, further analysis showed that compa-nies strongly aligned with any of these four organizational recipes were five times more likely to be healthy and to deliver strong, sustained performance than companies with mixed (or random) recipes.

Each of the four clusters we identified from the

data reflects a distinct underlying approach to managing, including core beliefs about value creation and what drives organizational suc-cess. Each can be described by the specific set of management practices prioritized by com-panies that follow it (see Exhibit 2, p. 27).

How We Track Health

For the past 11 years, we have measured and tracked organi-zational health in hundreds of companies, business units, and factories around the world. We ask employees (more than 1.8 million and counting) about their perceptions of the health of their organizations and what manage-ment practices they do or don’t see in them. We then produce a single health score, or index, reflecting the extent to which employees say that their organizations are “great” in each of nine dimensions (or out-comes) of organizational health. To establish more precisely what each organization looks like, as well as its strengths and weaknesses, we also ask employees how frequently they observe four to five spe-cific management practices—how managers run the place—that drive those nine outcomes. Exhibit 1 (left) provides some flavor of how the management practices, 37 in all, line up against the outcomes.


The hallmark of the first, or leader-driven, recipe is the presence, at all of an organiza-tion’s levels, of talented, high-potential lead-ers who are set free to figure out how to deliver results and are held accountable for doing so. This open, trusting culture is typical of highly decentralized organizations or of new businesses, where the resolve of strong leaders, effectively multiplied by their peers across the organization, is essential to create something from nothing.

While most organizations use career oppor-tunities to motivate employees, companies in this cluster use career opportunities as a leadership-development practice. Role mod-eling and real experience are more important than passing along sage lessons.

Organizations following the second, or market-focused, recipe tend to have a strong external orientation toward not only custom-ers but also competitors, business partners, regulators, and the community.

These companies strive to be product innova-tors, shape market trends, and build a portfo-lio of solid, innovative brands to stay ahead of the competition. The best ones both

respond to demand and develop products that help shape it (a strong recent example would be Apple as it reshaped several consumer-technology markets). They have a shared vision and the strategic clarity to ensure that employees explore the right market opportu-nities, as well as strong financial management to provide individual accountability and to ensure that responses to market trends are in fact profitable.

The third recipe, which we call execution edge, includes companies that stress continu-ous improvement on the front line, allowing them to raise quality and productivity con-stantly while eliminating waste and ineffi-ciency. These companies place a heavy emphasis on sharing knowledge across employees and sites—not just as a way to foster innovation, but, paradoxically, also as the primary way to drive standardization. Knowledge sharing helps to manage the fre-quent trade-offs between the top-down need for network-wide consistency and bottom-up encouragement of employees; without it, the best ideas might not get disseminated across different units of an organization. Such com-panies are unlike market-focused ones, which push alignment and consistency more

A Note on Employee Engagement

There is no doubt that employee engagement—an outcome that has been variously defined—is an impor-tant asset for any organization.

Many of our clients tell us that, after measuring and trying to influence employee engagement directly for some time, progress is disappoint-ing—either on engagement or the busi-ness results they had hoped would improve as a consequence.

Our research tells us that where moti-vation is low, many other things are broken. And where we see high motiva-tion, the opposite is true.

This leads us to two distinct views:

• First, employee engagement results from getting a number of other things right. Over a decade of research tells us that a simultane-ous focus on direction, account-ability, coordination and control, external environment, leadership, innovation, learning, capabilities, and climate need to accompany a focus on motivation to achieve top health.

• Second, companies that attempt to influence engagement alone may be working on the symptom rather than the cause. Consequently, working on employee engagement in isolation invites the disappoint-ment of failure.


strongly from the top down by analyzing external trends and developing a clear strat-egy for where the market is going.

The fourth and final recipe, talent and knowl-edge core, is found frequently among success-ful professional-services firms, professional sports teams, and entertainment businesses. Such organizations emphasize building com-petitive advantage by assembling and manag-ing a high-quality talent and knowledge base.

They typically focus on creating the right mix of financial and nonfinancial incentives to

While most organizations use career opportunities to motivate employees, companies in [the leader-driven] cluster use career opportunities as a leadership-development practice. Role modeling and real experience are more important than passing along sage lessons.

acquire the best talent and then focus on motivating their employees and giving them opportunities. In contrast to companies in the leader-driven group (whose value is created through teams directed by a strong leader), talent and knowledge-core organizations succeed thanks to highly skilled individual performers.

Implementing a Healthy Recipe The case of a global chemical manufacturer we know highlights the power of the recipe approach. This company faced increasing energy costs, intensifying international com-petition, stricter environmental regulation, and the shutdown of one of its sites in an envi-ronmental permit dispute. It had to move quickly to reduce its costs, improve its main-tenance productivity, and raise production.

This company’s mining operation had approx-imately 450 employees distributed in an area more than five times the size of Manhattan. A health-feedback session where the voice of the organization was “mirrored” back to it

showed clearly that the appropriate recipe was execution edge. After an action-planning workshop, executives developed interventions to encourage the most important practices for this recipe: knowledge sharing, employee involvement, and a creative and entrepreneur-ial environment. Efforts were made to redefine the role of frontline supervisors (including retraining), to engage the frontline workforce, and to step up the impact of employee com-munication. These initiatives led to greater employee involvement in decisions and more bottom-up knowledge sharing.

For example, the company introduced regular one-on-one visits between miners and supervi-sors to discuss productivity strategies, review progress meeting production targets, and engage in “micromine planning.” Supervisors became the bottom-up conduit for cross- fertilizing these ideas in daily shift-production meetings, weekly “step back” meetings, and monthly management meetings.

Other miners and supervisors, motivated no doubt by the continuing emphasis on account-ability for production, voluntarily adopted the best solutions. Not unexpectedly, the min-ers and supervisors began to feel greater own-ership of their work, and employee engagement increased by 20 percent.

As for the operational-performance goals, wrench time5 increased to 45 percent, from a baseline of 22 percent. Productivity, in turn, rose by 50 percent over a two-year period, generating additional profits of $350 million. Costs fell sharply, with annual run-rate savings of approximately $180 million.

It is worthwhile noting that the transforma-tion blended health objectives with perfor-

mance goals. Neither was treated in isolation. One reinforced the other, making each imme-diately relevant and maximizing the likeli-hood that the organization will sustain performance and respond successfully if chal-lenged again by severe market disruption.

Building a Healthier Organization

What can be learned from the four healthy organizational clusters our latest research identified? How can companies adapt accordingly?

We certainly wouldn’t suggest that organiza-tions blindly seek to replicate one of the cluster recipes, ingredient by ingredient or practice by practice. Just as great chefs don’t copy and paste the recipes of others, compa-nies must take these general archetypes as inspiration and identify the pattern of healthy practices that best fits their own organizations and strategies. In the continu-ing search for a better-functioning organiza-tion, companies should consider the following issues.

The Imperative of Alignment Between Strategy and Health Successful companies match their organiza-tions to their aspirations. Once a company has identified the most appropriate organiza-tional recipe for the chosen strategy, it should align the organization as far as possible with that mix of practices. If its most important day-to-day practices do not support its strat-egy, or are not consistent with the direction communicated by its leadership, the mis-alignment can often undermine both overall performance and health.

Such misalignments often happen in strategic shifts. A large technology company we know changed its product and service mix and rap-idly accelerated its globalization strategy. It then realized that what it really needed was a new focus on developing high-potential leaders who could direct next-generation businesses and operate with a global mind-set. Such moves would bring the company closer to the leader-driven recipe. Its old execution focus was no longer a powerful competitive weapon.


Dr. Michael Bazigos is an executive in McKinsey & Co.’s OHI Solution-based in the firm’s New York City office. He can be reached at [email protected].

Dr. Aaron De Smet is a principal at McKinsey in Houston. He can be reached at [email protected].

Dr. Bill Schaninger is a director, with global responsibility for organiza-tional analytics in Philadelphia. He can be reached at [email protected].

Scott Blackburn, Lili Duan, Chris Gagnon, Scott Rutherford, Matt Smith, and Ellen Viruleg contributed to this article.

Just as concentrating on too many practices diminishes an organization’s odds of achieving top health and success, adding the wrong practices to the recipe can be extremely harmful.

This company developed what it called “criti-cal paths” for a ladder of opportunities avail-able to high-potential leaders. These paths culminated in an important role, such as gen-eral manager for a large region, and promoted to prominence leaders who were visibly inspi-rational. When the company’s own research showed that trust accounted for 90 percent of its employees’ perceptions of how effective their managers were, it focused its develop-ment efforts accordingly. (Coincidentally, trust was one of its three core cultural values.)

The company ultimately avoided the “com-modity hell” it feared. It reliably increases its margins every year, leads its industry in seg-ments where it elects to compete, and is rec-ognized by respected analysts as a leading “talent factory.”

The Importance of Selection Our earlier research had already shown that to be in the top group of healthy organizations, companies must do better than bottom-quartile ones across the full suite of 37 management practices. But a better-than-bottom score is generally enough for practices that are not essential to a company’s recipe. The trick is to be truly great in a handful of practices—and not to worry a lot about the rest, which is just as well because no company has the capacity, resources, or management time to be great at all 37. The power of the four recipes our research unearthed is that they provide an indication of where to concentrate improvement efforts.

We discovered that 73 percent of the compa-nies that strongly or very strongly follow one of the four recipes (and are not in the bottom quartile for any practice) enjoy top-quartile health. By contrast, only 7 percent of compa-nies that have at least one broken practice and a less-than-strong embrace of any of the recipes are in the top quartile.

Taken together, this represents a better than 10:1 ratio of effectiveness. It also suggests that the right course is to fix all broken practices (by improving them enough so that a company escapes the bottom quartile) and to turn a targeted handful of practices into true strengths. Trying to exceed the median bench-mark on a large number of practices is not effective.

The Danger of Recipe Killers

Our research also identified recipe killers—the management equivalent of baking a beau-tiful chocolate soufflé but then adding too much salt and rendering the dish inedible. The new data suggest that, just as concentrat-ing on too many practices diminishes an organization’s odds of achieving top health and success, adding the wrong practices to the recipe can be extremely harmful.

One example is the overemphasis on command-and-control leadership styles in companies trying to follow the execution-edge recipe. Most people think execution requires that approach. Actually, execution requires tremendous on-the-ground energy, so the best execution-driven organizations employ internal competition and bottom-up innovation to empower the front line to excel. Overuse of top-down processes would kill that dynamic—and, indeed, in our data set the least healthy execution-edge organiza-tions are those that have the authoritative-leadership practice in their top 10.

Building organizational health can be a pow-erful lever for improving the long-term per-formance of companies. Leaders can’t ignore this lever, given the accelerating pace of change facing most industries.

The journey to organizational health has sev-eral paths—the four best ones were identified here. But gratifying simplicity masks hidden

risks. Choose well your recipes and ingredi-ents, as the wrong mix may sour employees, executives, and investors alike.

References 1 Keller, S. and Price, C. Beyond performance: How

great organizations build ultimate competitive advantage. First edition, Hoboken, NJ: John Wiley & Sons, 2011. (See also Scott Keller and Colin Price, “Organizational health: The ultimate competitive advantage,” McKinsey Quarterly, June 2011, mckinsey.com.)

2 These were the fortunate ones. Our global survey shows that only one-third achieve change goals.

3 The explanatory power rose to 56 percent when a single outlier was removed.

4 The full database includes many nonpublic companies and government organizations that were excluded for this analysis.

5 An indicator of maintenance performance: a measure of the amount of time that craft personnel spend actually carrying out their primary tasks (for instance, using tools to make a repair), as opposed to time spent traveling from project to project or sitting in meetings.


Capturing the Value of Health and Productivity Programs

By Keith Caver, Thomas O. Davenport, and Steven Nyce

Healthcare reform has ignited debates, transformed industries, and reinvigorated individual health

consciousness. Little wonder that savvy organizations now recognize good health as a business

imperative—one with significant benefits for employee well-being as well as the company

bottom line. The connection among wellness, workforce effectiveness, and organizational health

is influencing the development of new strategies to deliver a more compelling and mutually

beneficial employment deal between individual and organization—in essence, the reciprocal “give

and get” relationship between employer and employee.


As more employers focus attention on employee health and wellness, they need to understand better how health

and productivity effectiveness drive the human capital and financial outcomes critical to organizational success and improved total shareholder returns. With this enhanced understanding must come more effective strategies for achieving the full array of finan-cial, productivity, and health results. HR col-laborates with senior leadership in the design of these strategies and plays a critical role in executing and managing the resulting programs.

But first let’s consider what organizations have to gain from improving employee health and wellness.

The Business Value of Health and Productivity Initiatives

Towers Watson’s 2013–2014 Staying@Work Survey revealed that improved health and productivity is a business priority in all coun-tries studied. The majority of respondents said they expect to increase support for pro-grams in these areas over the next two to three years.

Our findings uncover a solid link between highly effective health and productivity strat-egies and strong human capital and financial results—including improved worker produc-tivity, increased turnover savings, and improved benefit cost management—that underpin organizational health. These results are not only evident within the United States, but extend out on a global basis. The Towers Watson Statying@Work research has demon-strated over the last decade the strong link between health and productivity effective-ness, a high-performing health care program, and u l t imate ly super io r f inanc ia l performance.

The critical question is, what are the key ingredients of an effective health and produc-tivity strategy? By examining two critical outcomes of highly effective health and pro-ductivity programs and practices—improved workforce health and increased workforce

effectiveness—we can better understand the value of these initiatives.

Improved Workforce Health

Improving workforce health and lifestyle behaviors lowers medical and disability claims and reduces unplanned sickness, absence, and lost productivity. Using the U.S. as an example, our research shows that com-panies with highly effective health and pro-ductivity programs experience:

• Reduced health care costs of more than $1,600 per employee, giving a company with 20,000 employees a $20 million advantage over companies with low- performing programs

• Fewer lost days due to unplanned absences and disability (3.3 compared with 4 days), which can increase a typi-cal company’s benefit savings by con-siderably more than 30 percent when combined with related savings on health care costs

• Reductions in some health risks (tobacco use and sedentary lifestyles or physical inactivity) as well as lower voluntary turn-over rates

In addition, on a global basis, employers with highly effective programs that contribute to improved workforce health report 34 percent higher revenue per employee and market pre-miums that are 20 percentage points higher than low-effectiveness companies.

Emphasize Workforce Effectiveness

An effective health and productivity strategy invests in a comprehensive set of programs that spans the entire health continuum. But the recipe for a successful health and produc-tivity strategy involves much more than hav-ing health programs in place. The most effective health and productivity strategies extend beyond physical and mental health to encompass the work environment, culture, and interpersonal relationships that connect

employees to the mission and goals of the organization. Strategies that create a compel-ling, enterprise-wide employment deal through the organization’s reward structure, leadership, and communication program cul-tivate a highly engaged and effective workforce.

Our recent research points to a consistent relationship between high employee engage-ment and strong buy-in for employer initiatives promoting a healthy workplace environment. Absent some compelling per-sonal reasons, disengaged employees are unlikely to connect with their employer on health and wellness issues.

In contrast, highly engaged employees are three to four times more likely to be aware of, receptive, and responsive to the goals of the wellness programs (see Figure 1). In fact, these dialed-in employees are more than three times more likely to respond to their employers’ wellness efforts and take actions to live a healthier lifestyle than their disengaged counterparts. As we see in Figure 1, highly engaged employees have a greater awareness of their employers’ well-ness initiatives, such as the availability of healthier food options in the cafeteria or tools to make better health decisions. This awareness predisposes employees to be receptive to manager involvement in well-ness activities and to respond positively to various employer-sponsored initiatives.

Falling Short—And What to Do About It

Despite the evidence supporting the potential employee and employer benefits of improv-ing workforce health and lifestyle behaviors, many employers are falling short in these areas. For instance, in the U.S., half of employers participating in our Staying@Work Survey say they offer various employee programs but do not have a formally articu-lated health and productivity strategy. Only 30 percent, however, report having effectively communicated a strategy and accompanying value proposition.

Globally, roughly half of survey respondents in each country indicate that, while they offer


various employee programs, they do not have a formally articulated health and productiv-ity strategy aligned to business priorities. In fact, only 10 percent to 15 percent of organi-zations in each market have an articulated health and wellness strategy with stated objectives and goals.

However, most employers recognize the importance of capturing this missed oppor-tunity and plan to do so. Consistent with this recognition is a key theme echoed across all markets: the need to create a workplace cul-ture of health. Said succinctly: culture beats scheme. Unless you get the culture right, even the cleverest designs will have a limited chance of success.

To develop an effective health and productiv-ity strategy that will drive such a culture, senior leaders and HR staff must understand and address the challenges they face on their journey. The most important actions fall into two categories: improving employee engage-ment in wellness programs and upgrading the behaviors and actions of managers and exec-utive leaders. HR plays a central role in the development and management of initiatives that drive wellness engagement and improve leader and manager effectiveness.

Improving Wellness Engagement

Employers striving to develop and implement a coherent health and wellness strategy should start by understanding what employ-ees value. Because health and well-being is a personal issue, many organizations use employee opinion surveys and consumer marketing techniques to segment their employee population to better understand the needs, preferences, and values of different employee groups. Using this knowledge, they can then establish program strategies and priorities, implement different program ele-ments, measure their progress, and modify program elements based on those results to drive sustainable change.

What are some specific tactics that employ-ers can use to improve participation in health and productivity programs? Employ-ers with leading health and productivity programs in the U.S. look for ways to con-nect with employees in the workplace by sponsoring competitions between employee groups and worksites as well as tapping into the emerging social media by sponsoring affinity groups and promoting the use of mobile apps to complement health and well-ness programs.

Incentives can also play an important role in motivating employees to participate in these initiatives. Globally, more than 50 percent of employees report incentives would encour-age them to participate in an employer- sponsored activity. Financial incentives to encourage healthy behaviors are used pri-marily in the U.S. But there is a growing rec-ognition that external incentives may not be enough. Consequently, some organizations are shifting their focus to more intrinsic val-ues of health and wellness.

It is also critical for employers to communi-cate their health and wellness strategy using consistent messaging via a combination of high-touch (e.g., in–person meetings) and high-tech (e.g., social media apps, web tac-tics). They should target their communica-tions to a segment of “persuadable” employees. This segment may be skeptical about the initiatives offered, but can be per-suaded if compelling reasons are offered.

Overcoming Employee Resistance

Employees have different attitudes about their employer’s role in their health and well-being. Targeting employees that are more receptive to employer involvement will lead to better outcomes. To help employers better understand their employees, we have identified three types of employees based on their attitudes to employer-sponsored health and wellness initiatives as reported in our Global Benefits Attitude Survey.

• On board. These employees support the role of the employer in encouraging health and willingly participate in employer initiatives (globally 25 percent of employee populations).

• Persuadable. Employees in this group are skeptical about the well-being initiatives offered, but can be persuaded given suit-able circumstances (56 percent of all employees).

• Resistant. These employees are not sup-portive of employers having a role in their health and well-being (19 percent of employees).


“On-board” employees are twice as likely to participate in their company’s wellness pro-grams, 50 percent more likely to have a healthy BMI, and report nearly two fewer lost workdays throughout the year. Moreover, they are twice as likely to be highly engaged as employees who are resistant to their employer’s involvement in their health. Employers must build trust with their employ-ees to overcome the most common workplace stressors and to connect on personal issues such health and lifestyles. These are critical factors to cultivating an environment that can motivate employees to embrace and sustain good health habits. But it’s important to note that there is more than one path to building a stronger relationship with employees. In fact, the health and well-being initiatives may be the key factor that connects some employ-ees—including the more health-conscious employees—to the mission, vision, and direc-tion of the organization.

Regardless, these foundational elements will help employers build a culture of health and well-being in which engagement in these ini-tiatives is not just a narrow “health” issue. Rather, the impact of this health culture can extend to broader worker engagement in the company. (See sidebar, “Building a culture of health and well-being,” above.)

Strengthening Executive Leader and Manager Effectiveness

Multiple research efforts highlight the need to improve the role of executive leaders and man-agers in driving health and productivity initia-tives. According to the Towers Watson 2014 Global Workforce Study, only 45 percent of employees say that senior leadership is sin-cerely interested in employee well-being. Even more disturbing is the finding from our Stay-ing@Work Survey that reveals senior leader support is a leading obstacle to changing employee health behavior in many countries, including China, Brazil, Canada, and the U.S.

Reinforcing the urgency of this situation, Towers Watson’s 2013/2014 Global Benefits Attitude Survey indicates that, while employ-ees are receptive to employers taking an active role in supporting their health and well-being,

they do not perceive senior leaders to be sup-portive of a healthy work environment. More-over, fewer than half of employees say that their managers are actively encouraged to support the health and well-being of their direct reports. (See sidebar, “Managers and senior leaders are not perceived as supportive of employee health,” above.)

Effective executives are committed to an orga-nization’s strategic priorities and model its values and culture. From the CEO on down, they prioritize the development of a culture of health and reinforce those programs that deliver strategic value to the organization. And to build a foundation of trust with their employees, leaders model the behaviors they want from employees: They get themselves

in shape; they participate in wellness chal-lenges; they get flu shots. Our research shows that inspiring and motivating employ-ees is the most important driver of leader-ship effectiveness. Given that trust and confidence in senior leaders is a key driver of employee retention, leadership support for health and productivity efforts and the resulting bond of trust between leaders and employees will help give employees a reason to stay with their company.

Like effective executives, high-performing managers model a healthy lifestyle. In addi-tion, they provide face-to-face communica-tion using consistent messaging about the value that health and productivity initiatives deliver to employees.

Managers a l so he lp dr ive program engagement. More than half of employees (54 percent) say that the best managers help remove obstacles to success, a key driver of enablement and sustainable engagement. In the context of wellness programs, this may involve clarifying program goals and objec-tives, and providing employees with the tools to track progress and communicate success. Effective managers also drive sustainable engagement in these programs by ensuring

that employees have a supportive environ-ment that energizes them to participate and sustains them through the required program activities.

Managers have a particularly dramatic effect on employee stress. High stress translates directly to health problems. The American Psychological Association and the American Institute of Stress have estimated that stress-related illness costs U.S. companies more


than $300 billion annually. Job pressure, with manager behavior a principal factor, is the No. 1 cause. Our research suggests, how-ever, that employees and organizations dis-agree about the causes of stress. (See sidebar, “Employers and employees not aligned on causes of stress,” below.)

Employers view work–life balance as the leading source of stress. In contrast, the key sources of stress for employees are not work–life issues but workplace issues—namely, lack of support, low pay, and con-flicting job expectations. These stress drivers reflect a gap in two elements critical to sustainable engagement—enablement, which relates to resources, and support in various forms, including financial (e.g., pay) and energy, which relates to the well-being that comes from a supportive social environment that ensures clear job expectations.

Addressing the perception of low pay is chal-lenging for employers. Few have sufficient budget flexibility to make substantial increas-es to base pay across the employee popula-tion. But this doesn’t mean that companies can or should ignore the message that employees feel under-rewarded. Research into employee stress indicates that a per-ceived imbalance between effort and reward (not just financial remuneration but also rec-ognition and career growth opportunities) is

a major cause of stress. Redressing a per-ceived effort–reward imbalance requires, at a minimum, companies to ensure that:

• The mechanics of the pay system (base pay, short- and long-term incentives) are understood by everyone in the organiza-tion; lack of knowledge leads to conspir-acy theories about how executives exploit employees by paying far below market.

• The manager population knows how to identify the strongest contributors and uses the system to reward them accordingly.

• The performance assessment process underlying rewards is applied fairly and accurately; for example, forcing a perfor-mance distribution onto a bell-shaped curve often fails to recognize the impor-tant contributions of the most effective employees.

• The organization provides the richest pos-sible array of learning and career develop-ment opportunities; our research consistently shows that the opportunity to master a job and grow with an organiza-tion is a highly valued reward as well as an important buffer against the stress of stuck-in-a-rut jobs.

• The employee population understands the full scope of rewards provided, so that they can value both financial elements and the non-financial rewards that don’t show up in their pay checks.

• Supervisors and managers can also play an important role in addressing the causes of workplace stress:


• Employees can navigate between work challenge and work overload. Overload is what happens when job tasks are too numerous or too complex for the time available, when people are unclear about their roles and expectations, when bore-dom with repetition pushes out energy to care and perform. Managers should ensure that jobs are challenging and engaging, but not impossibly burdened with stress-generating expectations.

• People have support from their teams and their managers. Advice from supervisors, help from peers, technology that per-forms—these are the resources that make challenging work feasible, rewarding, and healthy. The manager’s job is to ensure that, to the extent possible, employees have access to the physical, emotional, and social support needed to make stressful work manageable.

• People are given reasonable control over how, when, and where they work. Auton-omy over work process is a critical buffer against stress. People who have the free-dom to decide how best to do their work consistently report higher engagement in their jobs, greater commitment to their organizations, and lower stress.

• People are provided rewards, especially nonfinancial, intrinsic recognition, for a job well done. Our research reveals a strong link between manageable stress levels and employees’ perception of the effectiveness of their employment deal. More than 80 percent of employees who say their employment deal is highly effec-tive and well understood say their stress levels are manageable, compared with 39 percent of those who give their employ-ment deal a low effectiveness rating. Man-agers should focus on aspects of the deal within their purview, including important intrinsic elements—informal recognition, development opportunities, challenging and fulfilling work assignments, and, of course, job mastery and career growth. These are inexpensive to deliver but pow-erful in helping to drain stress from the work environment.

Keith Caver, is the Americas practice leader for Towers Watson’s Talent Management and Organizational Alignment. He can be reached at [email protected].

Thomas O. Davenport, is a senior practitioner with Towers Watson Research and Innovation Center and a senior consultant with Talent Man-agement and Organization Alignment. He can be reached at [email protected].

Steven Nyce, is research director at Towers Watson Research and Innova-tion Center. He can be reached at [email protected].

Christy Taylor, senior consulting actuary, Towers Watson Benefits, contributed to this article.

The Role of HRHR plays a critical role in the design, execution, and ongoing management of health and productivity initiatives. To build a culture of health, HR executives begin by enlisting the support of senior leadership to make health a top priority. They use data and analytics to better understand the employee

To-Do List for a Healthy and Productive Workforce

Insights from our research and client work reveal that high-effectiveness organiza-tions take a holistic view of health and productivity that focuses on several key areas:

• Gaining the commitment of senior leadership.

• Developing a comprehensive strategy that reflects the organization’s specific challenges and goals, is based on identi-fied population health issues and absence data, and integrates every aspect of health and productivity—from approaches to health benefits to t h e m a n a g e m e n t o f v e n d o r relationships.

• Implementing employee engagement strategies that promote a supportive environment, offering financial incen-tives for program participation and providing tools to help employees understand their best health care options.

• Engaging managers as role models for a healthy lifestyle and training them to provide the face-to-face communica-tion employees need.Communicating frequently using a combination of high-touch and high-tech tactics.

• Understanding and addressing the sources of employee stress through a cohesive, manager-led strategy.

• Providing easy access to high-quality health care—both mental and physi-cal—so employees can address health issues early, thereby reducing or avoid-ing absence.

population, including demographics, drug utilization, absence/productivity statistics, and engagement levels. This information is then used to develop programs focused on wellness, prevention, and managing illness.

At the same time, HR must promote financial well-being, which reduces stress and supports a culture of health. This involves ensuring the baseline competitiveness of both compensa-tion and benefits, and establishing a clear line of sight between employee performance and pay by differentiating salary and bonus awards based on performance. It is also important to periodically assess employee preferences and adjust the total rewards package accordingly.

To be sure, this is not a simple or easy set of tasks. Building a healthy workplace environment is a multi-faceted challenge where there is no silver-bullet solution. It requires continuous time and attention where the activities, programs and even your strategy evolve with the organization. We observe, however, that few investments organizations can make will generate a higher return on investment. From our perspective, this makes investment in employee health and well-ness a prudent strategic initiative, as well as the right thing to do.


Tone at the Top: Leadership as the Foundation of Organizational

Health and WellnessBy Kathleen T. Ross, Ph.D., and Paul Squires, Ph.D.


The leadership models that dominate the current landscape are largely competency based. While competen-

cy models are an important component to understanding and developing effective lead-ership, they are inadequate. At worst, they reduce the complex nature of leadership to a simplistic, utilitarian portfolio of behaviors. At best, they provide a useful toolkit without the necessary context and grounding to make them come alive and be sustainable for an individual leader.

Ultimately, leadership is far more than a defined set of behaviors and competencies—it is a complex relationship involving trust, skill, and vision. Additionally, leadership models and development efforts must include a strong moral component. Today’s leaders have impact well beyond their individual organizations. Whether they lead corpora-tions, government entities, nonprofit, or faith communities, leaders must consider that their actions today ripple throughout communities and the world at large—well into the future.

Healthy Companies International has advised leaders and conducted leadership research for more than two decades. During that time, we have consulted with, trained, and coached thousands of leaders around the world. Our extensive experience with leaders provided us with insights about the importance of a holis-tic approach to leadership development. Given our commitment to ongoing research, and to clarify our thinking about the impor-tance of an integrated leadership model, we systematically interviewed more than 300 leaders in more than 40 countries. We record-ed and transcribed interviews and used nar-

Researchers have used many ways to ascertain leadership’s effect on the health and wellness of

organizations. A number of leadership models focus on traits, behaviors, competencies, spheres

and types of influence, interaction patterns, and roles. While each of these models provides some

insight, our research concludes that none are sufficient for fully understanding the complexity

leaders face in contemporary organizations—and certainly none capture the impact a leader has

on its overall health and vitality.

rative analysis to identify recurring themes and patterns. As we recontextualized these elements into our leadership model, we con-firmed our interpretations and conclusions with many of our interviewees. This iterative process is the foundation of what we con-clude are the core elements of sustainable, contemporary leadership

Leaders’ Lives and Goals, IntertwinedWe observed that the most effective leaders approach leadership from a personal and holistic perspective. Their stories acknowl-edge the significance of their own personal journey—often integrating lessons from childhood into the fabric of their leadership style. We were struck by the extent to which great leaders “own and hone” their individual heritage and experience (both good and bad) with their unique leadership style.

This is not to suggest that leaders were not highly focused on execution. In fact, all of the leaders we interviewed were clear about their leadership strategies and desired outcomes, which were categorized into the following Leadership Actions:

• Drive high performance by promoting a culture of excellence and accountability

• Seize new opportunities by encouraging curiosity and learning

• Unleash human potential by challenging people’s minds and engaging their hearts

• Foster productive relationships by model-ing authent i c i ty and rec iproca l relationships

• Forge a shared direction through elicit understanding, commitment, and owner-ship for the organization’s vision

• Tap into a higher purpose by communicat-ing energy and meaning around the orga-nization’s mission and work

While each of the leaders we interviewed spoke in detail about the successes, failures, and lessons learned from their various leader-ship efforts, the majority wanted to start with the background and foundation of their suc-cess. They wanted to create a context for the discussion. They wanted us to know who they were—as a prelude to what they were trying to do or achieve in their role. This led us to observe that great leadership is rooted in self-awareness and authenticity.

Based on what we were hearing and observ-ing from these leaders, we began to build a framework to capture the various dimensions that emerged as the foundation of (and the true differentiators for) developing and sus-taining effective leadership.

The Roots of Holistic LeadershipAs we began making sense of the vast inven-tory of information, we realized that leaders were honing their priorities and personal mastery practices in response to major dis-ruptive trends they were facing. We identified


six major disruptive trends and six primary development areas that allowed us to catego-rize the research results—and to create a framework that we could both test and use for leadership development going forward (we use the term health as it best captures the notion of optimal functional efficiency in a living organism). We are explicit in our defini-tions of each of the dimensions of health, which tend to be broader than conventional usage (particularly as it relates to spiritual health).

• Intellectual health is important because of significantly increased complexity; it involves thinking beyond the linear path, embracing deep curiosity, an adaptive mindset and paradoxical thinking. Lead-ers need this mental flexibility to adapt to today’s rapidly changing environment and analyze complex, even contradictory information.

• Vocational health is important because of significantly increased competition; it involves having a sense of meaningful call-ing. It provides leaders the drive they need to achieve personal mastery and market savvy while also modeling for others the value of excellence and performance.

• Physical health is important because of the speed of the current environment; it is about energy management. Today’s lead-ers need discipline to maintain a peak-performance lifestyle that enables stamina and vitality despite unrelenting demands. It also means having mind-body aware-ness to stay conscious of the ways fatigue, stress, and illness can influence percep-tions and performance.

• Emotional health is important because of the level of uncertainty in today’s business landscape; it ensures balance so that nega-tive thoughts and feelings don’t disrupt performance. Emotional health is rooted in self-awareness and is comfortable with uncertainty and vulnerability. A default toward optimism ensures resilience in the face of setbacks.

• Social health is important because of the need for transparency in the face of signifi-cant cynicism toward today’s leaders; it focuses on how you interact with the

world and people around you—including having strong personal connections, mutually beneficial relationships, and nourishing communities. Social health elevates leaders to be authentic and main-tain integrity in all relationships and interactions.

• Spiritual health is important because of the increasing globalization and inter-connectedness of today’s world; it is defined as seeing oneself as part of a greater whole—having a higher purpose and grasp of the global and interconnect-edness of today’s world. Spiritual health includes having a magnanimous and gen-erous spirit that fosters a long-term per-spective rather than merely a transactional one.

While there is significant research around several of the areas we identified (most nota-bly Daniel Goleman’s work on EQ¹ and the Corporate Athlete’s focus on physical and emotional health for leaders²), we sensed that a more holistic view of leadership would sub-stantially add to the body of knowledge. Although psychologists and a variety of medical practitioners have long known of the powerful connection between cogni-tion, emotions, relationships, and overall health, we found little research that linked this knowledge to our understanding of lead-ership and its impact on personal or organi-z a t i o n a l p e r f o r m a n c e . T h e s e a r e interconnections that, until now, have been extremely underestimated.

The Research Design

To test our hypothesis—that each dimension of leadership health is predictive of effective leadership actions and high performance—we designed a survey that gathered feedback from leaders, their boss, their subordinates, and their peers. A separate survey gathered feedback about effective leadership actions, and a third gathered data about each leader’s job performance. This third survey included questions about employee engagement. Sur-vey questions were painstakingly crafted, pretested and honed prior to beta testing (via multiple rounds of “friends and family” testing). Through an item analysis, questions that did not support the validity and reli-

ability of a scale in the survey were elimi-nated after the beta testing and prior to commercial launch.

These surveys included:

• Questions on perceived health in each of the six leadership dimensions. Examples of some of the 108 questions include:

[Name] manages his/her workload so that s/he has the energy needed to work and compete successfully (physical health).

[Name] creates heightened expecta-tions without raising the stress levels of the team (emotional health).

[Name] is good at seeing different perspectives in meetings without judging them (intellectual health).

[Name] has a business reputation for being open, honest and trustworthy (social health).

[Name] obviously enjoys and is ener-gized by the work s/he does every day (vocational health).

[Name] is someone who not only contributes to the success of the busi-ness, but seeks to improve the lives of all those around him/her (spiritual health).

• Questions about effective leadership actions. Examples of some of the 30 ques-tions include:

[Name’s] team operates with a shared set of values (higher purpose).

[Name’s] team members have a clear sense of how their individual roles contribute to the broader organiza-tional goals (shared direction).

[Name’s] team works to ensure that it provides the most possible value to our business partners (productive relationships).

Everyone on [name’s] team feels like they are learning important knowl-


edge and skills that help them grow (unleash human potential).

[Name’s] team regularly capitalizes on new business opportunities (seize new opportunities).

• Questions about leader’s job performance and level of engagement of the feedback team; Examples of the 12 questions include:

[Name] is one of the reasons employ-ees stay at the organization.

[Name] is highly effective.

Others have a strong desire to join [name’s] team.

I feel passionate about the work we do because of [name].

I am strongly aligned with the goals of the company because of [name].

We chose to beta test these surveys with six major global companies, including: PBS,

Alcoa, Kemet, New York Life Insurance Com-pany, Huntington Ingalls, and PepsiCo (for a total of 71 participants and 497 multi-raters). Below is a break down of demographics; par-ticipants also encompassed a variety of indus-tries, functions, and countries.

The Findings

An analysis of the three surveys found statisti-cally significant relationships among dimen-sions, actions, and job performance, including employee engagement. That is, each dimen-sion of leadership health predicted the effec-tiveness of leadership actions and leader job performance as perceived by respondents (correlations ranged from .3 and .7).

As illustrated by Table 1 (p. 40), leaders who obtain high health scores correspondingly obtain high job performance ratings (and low health scores correspond to low job perfor-mance ratings).

The most notable finding shown above is the emergence of spiritual health as the most sig-

nificant predictor of high job performance. As indicated, those leaders who had a high spiritual health score had an average job per-formance score of 78 percent1, compared to those leaders with a low spiritual health score averaging a performance rating of 31 per-cent. The 47-point gap is the largest among the health categories. This finding offers fresh and compelling insights for the field. The research also delivered more confirming results in this regard.

While these results indicate that alone each of the health areas distinguishes top from bottom job performers, it is natural to ask, taking all of the health areas together, which are most predictive of job performance? The answer to that question is contained in Table 2 (p. 40), which illustrates the predic-tive level of the leadership health on effective leadership actions.

These results provide further and stronger evidence of the importance of spiritual health for leader success. Spiritual health was pre-dictive of each of the effective leadership actions, and social health predicted four of the six. Although emotional health was pre-dictive of only one leadership action and intellectual and physical health were not directly predictive of any of the specified leadership actions, we know from Table 1 that each health was statistically significant relative to perceived overall performance.

These results also reinforce the interrelated nature of the model. Taking another look at the data through the lens of employee engage-ment reinforces the power of the model as a holistic approach to leadership. Once again, high scores for each health area correspond with high employee engagement scores.

Regarding the relative strength of the health areas in predicting employee engagement compared to job performance, the picture is more complex. Table 4 (p.41) presents the findings. Emotional, spiritual, and vocational health areas were significant predictors of employee engagement for male raters and intellectual and vocational health areas were significant predictors for female raters. These findings are unexpected and interesting. Cur-rent research and thinking about gender dif-ferences in leadership (in terms of both perception and development) are mixed and

Participants

Male 47%

Female 53%

Total 100%

Individual 2%Contributor

Middle 21%Manager

Senior 77%Manager

Total 100%

Multi-Raters

Male 60%

Female 40%

Total 100%

Individual 8%Contributor

Middle 28%Manager

Senior 56%Manager

Non-manger/ 8%1st line Supervisor

Total 100%

Demographics


somewhat controversial. However, it seems logical that the perceived strength of leader-ship behaviors is influenced by social or gen-der expectations (we may be more engaged by a female leader who is exceptionally smart and a male leader who has exceptional EQ because they defy the standard stereotypes).

Tables 3 and 4 (p. 41) provide an illustration of the collective influence of all dimensions of leadership health on employee engage-ment. There is significant research that docu-ments the importance of employee

engagement for employee retention, produc-tivity, and overall organizational success. For example, Gallup annually reports on the state of engagement in organizations. In their 2013 report, they stated that only 30 percent of the U.S. workforce is engaged, and 20 percent are actively disengaged. According to Gallup, the latter employees cost corporations $350 bil-lion per year in lost productivity.4 In another study of 7,939 business units in 36 compa-nies, the researchers found that engagement was related to customer satisfaction, produc-tivity, employee turnover, and accidents.5

Our research indicates that when a leader obtains high health scores, the leader also scores high on employee engagement ratings. This pattern was true for all dimensions, and each high health score is consistently 15 per-cent above the low health score.

Implications and Conclusions

There are three primary implications for these findings. First, they provide a different per-spective on the role of emotional intelligence in leadership performance. The finding that emotional health did not predict job perfor-mance but spiritual health did suggests that discussions and research about emotional intelligence are missing a key construct: spiritual health. While these two dimensions are certainly related, our research demon-strates the potency of spiritual health. Future research regarding emotional intelligence and leadership must take this finding into account. The spiritual health area is a new construct that is important for successful leadership.

Secondly, these findings identify differences between how respondents experience male and female leaders relative to employee engagement, inviting the need for further study and discus-sion about whether or not there are differences, however subtle, that may inform optimal leader-ship development initiatives.

Table 1

Percent High Job Performance vs. Health Score

% o

f Le

ader

s S

corin

g H

igh

on J

ob P

erfo

rman

ce

90

80

70

60

50

40

30

20

10Physical Emotionall VocationalSocialIntellectual Spiritual

High Health Score Low Health Score

51

78

31

6665

2226

68

27

68

3530

Cell entries t-values for Health Areas regression coefficients*

HealthAreas

ExecutePerformance

Reliably

FosterProductive

Relationships

Forge aShared

Direction

Tap into aHigher Purpose

Seize NewOpportunity

UnleshHumanEnergy

Emotional 2.59

Intellectual

Physical

Social 3.67 6.98 4.05 2.66

Spiritual 7.36 4.31 4.40 5.05 5.81 3.30

Vocational 3.05 2.66.

Table 2

*Larger values indicate greater predictive power. Each of the six leadership actions was entered into a regression model with the six healths as predictors; there were six regression mod-els. T-values that indicate the statistical significance of each predictor were odtained for each regression coefficient and for each of the six regression models. For example, the leadership action Unleash Human Energy, has three significant predictors (Emotional, Social, and Spiritual) of about equal importance. On the other hand, the leadership action, Execute Performance Reliably, has two significant predictors and Spiritual Health is twice as strong a predictor Social Health.


Kathleen T. Ross, Ph.D., is executive vice president, leadership develop-ment, at Healthy Companies Interna-tional. She has worked in a variety of settings, including start-ups, IPOs, and mergers and acquisitions in the private sector, as well for not-for-profit organizations. She can be reached at [email protected].

Paul Squires, Ph.D., is president and founder of Applied Skills & Knowl-edge. He can be reached at [email protected].

Finally, the cumulative findings have pro-found implications for how we think about leadership, as well as how we support and develop current and emerging leaders. Some have observed that these findings provide empirical support for what might be consid-ered conventional wisdom: being a well-rounded, grounded human being is at the center of being a great leader.

Ronald Heifetz identified “an unprecedented crisis in leadership” in his groundbreaking book, Leadership Without Easy Answers.³ He attributes that crisis to our lack of under-standing and unrealistic expectations of lead-ers as well as how best to support their

development. Heifetz’s work affirms our research, both of which conclude that orga-nizations need to recognize that leadership is both active and reflective. In addition to pro-viding leaders with development opportuni-ties in the way of training and stretch assignments, leaders need to be challenged to commit to a lifelong leadership development journey—a journey that includes deep intro-spection as well as mastering leadership skills.

Leaders need to be held accountable for developing their whole selves. Some best practices in this regard include personal lead-ership development plans, executive coach-

ing, mentor–protégé relationships with exemplars, and peer leadership learning part-ners. The more visible the development jour-ney of key leaders is within an organization, the more leadership development becomes a part of the fabric and culture of the organiza-tion. Leadership learning and development becomes who the organization is—not just what the organization does. We are hoping this research will prompt organizational dia-logue around dimensions of leadership too often not discussed. A deeper more holistic approach to leadership and leadership devel-opment will result in effective, fulfilled lead-ers and sustainable high-performing organizations that make their communities and the world a better place.

References1 Goleman, Daniel. Emotional Intelligence. New

York: Bantam Books, 1995. 2 Loehr, Jim. Corporate Athletic Training. Human

Performance Institute.3 Heifetz, Ronald A. Leadership Without Easy

Answers. Harvard University Press, 1994.4 State of the American workplace: Employee

engagement insights for U.S. business leaders; 2013 (A continuation of Gallup’s previous report covering 2008–2010).

5 Harter, J.K., Schmitt, F.L., & Hayes, T.L. (2002) Business-unit-level relationship between employee satisfaction, employee engagement, and business outcomes: A meta-analysis. Journal of Applied Psychology, 87(2), 268–279.

Table 3

Percent High Employee Engagement vs. Health Score

90%

80%

70%

60%

50%

40%

30%

20%

10%Physical Emotionall VocationalSocialIntellectual Spiritual

High Score Low Score

70%

23%25%

30%30%

72%

81%77%

75%70%

19%

28%

Cell entries are t-values for Health Area regression coefficients*

Health Areas Overall Male Female

Emotional 3.826 3.347

Intellectual 3.213 3.389

Physical

Social

Spiritual 2.462

Vocational 2.422 2.034 2.775

*Per the Table 2 note, the statistically significant t-values are reported above. The larger t-values indicate greater predictive power.

Table 4

The City Awakens to the Challenge of Mental Health

By Yochanan Altman, Clive Morton, Elizabeth Cotton, Roger Kline, and Michelle Altman



The October 18, 2013, edition of the London Evening Standard reported under the headline, “Stress and the

City: Has the banking world gone soft?” the following: “when it emerged on Tuesday night that top Barclay’s executive and former FSA boss Sir Hector Sants was taking three months off as a result of “exhaustion and stress” the financial world’s reaction—some surprise and plenty of sympathy—showed how things have changed. Two years ago, the announcement that Lloyd’s chief executive António Horta-Osório was taking a similar leave deeply shocked the City, with some observers unsure whether the stated reason—‘fatigue’—masked something more prosaic.

In fact, some of the City’s biggest beasts, once the preserve of macho, all-hours work-ing culture, are now taking stress so seri-ously you’d be forgiven for thinking they’ve gone soft.

A senior banker told the Standard this week that stress is now firmly on the City’s agenda. He said his bank even forces some workers to stay out of the office between Friday night and Sunday morning—what the rest of us call a weekend—and encourages holidays so tired minds can be “rested.” (Hermann, 2013)

The Square Mile, as the City of London is also known, is Europe’s financial hub, sec-ond only to Wall Street as the world finan-cial, banking, and insurance center (and the first on international transactions and rein-surance). Employing some 400,000 people in more than 2,500 institutions, the sector contributes about 4 percent of the country’s gross national product. Its highly visible pro-file among business elites, fast pace, high risk, legendary salaries, and out-of-this-world bonuses, attract the most ambitious, if not the best high-fliers, from all over the world. With a proportion of two men to every woman—as compared to the general workforce average of five men to four women (ONS, 2013), the Square Mile is also renowned for its “macho” culture.

The Mental Health “Iceberg”The extent of mental health problems in the City—the general population lifetime preva-lence of experiencing a serious, though not lasting, mental illness episode—is one in three globally, and nearly one in two in the United States (Kessler, et al. 2009)] are both

evident and troubling. While top bosses can-not hide from the public gaze, the great majority of mental-health-related difficul-ties among working people remain hidden.

A September 2014 survey by OnePoll found that 48 percent of employed Londoners (there are no separate figures for the City) have expe-rienced a common mental health problem like stress, anxiety, or depression in the last year, and 43 percent did not tell their employer. More than a third of respondents disclosed that they have taken a sick day claiming it was for a physical problem when it was in fact for a mental health issue (OnePoll, 2014). Though the major implications of mental illness for the individual (potentially long-lasting, poor quality of life, shortened life expectancy) and his or her family—and the severe costs to one’s career and financial situation—may be

is no exception (Fevre et al., 2011): incivility, disrespect (40 percent of the sample), bullying (nearly half of the sample) and even violence (6 percent) were prevalent. In a case study of a large financial services company, the authors note, “even minor exposure to only one ill-treatment behaviour left 60 percent of com-pany staff feeling stressed…25 percent felt the quality of their work suffered and 20 percent considered looking for a job elsewhere.” A survey of the U.K. financial sector (Robertson Cooper, 2014) states, “for most people, work pressures are a more important driver of health and productivity than non-work hassles.”

Altogether, the evidence suggests the City is facing a major problem, and what we hear of anecdotally, what we read about in the press, what we learn from surveys and more in-depth studies may be but the tip of the iceberg.

While top bosses cannot hide from the public gaze, the great majority of mental-health-related difficulties among working people remain hidden.

visible, but much less so are the enormous costs to a national economy. The Sainsbury Centre for Mental Health calculated in a 2007 report that cost to be £1,035 (about $1,654) for every employee in the U.K. work-force (SCMH, 2007).

In their groundbreaking book Mental Illness in the Workplace, Harder, Wagner and Rash (2014) posit alongside the common ailment of stress, clinical depression, and anxiety disor-ders, that the toxic work environment is as detrimental to mental health. Attention is called to external-to-work factors that induce a mental health problem, whether personality related, genetically conditioned, or in response to a critical life event (serious accident, major loss, marriage breakdown, and so forth); and work-induced triggers, in which bullying and harassment play a central role, alongside a culture of long working hours and little job security, not to mention toxic leadership. The highest incidence of corporate psychopaths (those who exhibit “dark leadership”) are to be found in the financial sector and the legal pro-fession (Boddy, 2010). An authoritative U.K. national representative study found that toxic elements permeate work environments in all sectors of the economy, and the financial sector

Getting HelpExecutives in the financial sector enjoy pri-vate health insurance, which normally includes a provision for mental illness, where-as for non-executive City workers who can-not afford costly private care, the situation is difficult. While the National Health Service is free for all, mental health services in the U.K. are severely underfunded (over £1 bil-lion spent on preventing physical health prob-lems as compared to £40 million on mental health preventative measures, Mind, 2014). The process to get primary mental health treatment from community mental health teams requires referral from one’s general practitioner, and it takes about three months to be seen. More severe cases requiring refer-ral to hospital may necessitate a lengthy wait, longer than a year, in the case of the City (City & Hackney, 2014).

Armed with these background data, we set out to explore the state of mental health among City workers and what some of the U.K.’s best known blue chip companies are doing about it. We talked to company exec-utives, trade union representatives, occupa-


tional health and mental health practitioners, recruiters, and outsourcing agencies. We also examined mental health issues and what is being done about them in some depth with Pete Philp, head of people proposition, and Jacinta Negri, wellbeing partner at the Royal Bank of Scotland (RBS).

RBS, a City giant, and until the 2008 financial crush, one of the world’s biggest banks, had to be rescued by the U.K. government at taxpay-ers’ expense, and consequently dealt with a public image portrayed in the media as the “least trusted bank” in the “least trusted sector of the economy.” Staff at all levels in the orga-nization have faced ongoing uncertainty about their personal and professional futures, as branches closed, divisions merged, and head-count was reduced.

With the banking crisis lingering on and the national economy at its lowest ebb in 2010, RBS observed a shift in the way employees engaged with its employee assistance pro-gram, Lifematters, reflecting increasing levels of employee stress. Employee Assis-tance Programs (EAP) are the first line of defense when resourced competently and managed discretely. In most organizations, EAPs are associated with HR departments or medical departments. Encouraging employees to access these programs freely and confidentially at an early stage of an emerging personal or work-related problem may often provide the key to a solution.

Prior to 2010, the majority of employees calls to Lifematters (67 percent) were to source support for practical, day-to-day life issues. By 2013, 59 percent of callers to the service sought counselling for emotional issues, and of those, 57 percent presented with anxiety and depression at the time of their first contact with the service.

“There is a clear understanding of the con-nection between employee satisfaction and customer satisfaction, hence executives are very interested in mental health issues, as personal well-being is seen as an essential link in effective delivery of the bank’s strategic goals,” explained Philp. RBS’s approach to positive mental health is led from the top, with CEO Ross McEwan in the know and supportive of the bank’s plans to sign up to the “Time to Change” pledge, which will reflect its commitment to remov-ing the stigma associated with mental health issues in the workplace. “Once the condition becomes known, the member of staff is referred to suitable help, whether counsel-

ling, CBT [cognitive behavioral therapy], or to temporary disability arrangements. The prognosis and treatment is targeted at sup-porting the individual’s return to health first and then their return to work.”

Staff’s personal stories on mental health challenges, (what it felt like being at work with a mental health problem, how they dealt with it, and what support they received) are published in the in-house online maga-zine and are open for other employees to comment on. This already goes some way to opening the internal dialogue on mental health. On the preventative side, the RBS Choice program places an emphasis on flex-ible working times and locations. This peo-ple program is seen as key to ameliorating pressures employees experience both at home and at work. Other City institutions are developing similar initiatives to RBS. The City Mental Health Alliance, supported

ience,” and a swift return to work, rather than promoting a priori and axiomatically a healthy workplace for people.

This attitude is not confined to the City. As part of the U.K.’s overhaul of welfare provi-sions, a new National Health and Work Service will come into place in 2015 to assess people’s “fitness for work.” Intended to help employees and employers manage absence with a particular focus on mental health, employees on sick leave will receive an occu-pational health assessment when they reach, or are expected to reach, more than four weeks of sickness-related absence. A result-ing return-to-work plan, administered by a private contractor, will be shared with their employer and personal physician. In prac-tice, the new policy, with its focus on a return to work, is likely to amount to a new target-driven sickness absence system. The fact that it is outsourced to a private contrac-

Encouraging employees to access these programs freely and confidentially at an early stage of an emerging personal or work related problem may often provide the key to a solution.

by top management at several major City organizations, aims to increase literacy and openness about mental health, provide prac-tical advice to employers, and combat the stigma of mental health problems.

Mental Health and the Good EmployerIn the epilogue to their book, Harder, Wag-ner and Rash (2014) note their frustration with the lack of resources available to address mental health issues in the workplace and their experience “being unable to even get workplaces to discuss mental health and what it would take to create mentally healthy workplaces.” The good news is that mental health issues are now discussed in the City. That’s a promising beginning. However, the terms of discussion are clearly confined to: a) it’s an individual’s problem, not an orga-nization-culture-induced malaise, and b) the language posits the policy of intervention programs, whether preventative or post-crisis, as aiming to achieve “fitness,” “resil-

tor will do little to reassure people. The experience of similar reforms with the recent Work Capabilities Assessment administered by Atos, a private contractor, is not encour-aging. A large number of people being assessed reportedly have considered suicide, or died prematurely. (Gentleman, 2013)

The inbuilt tension between productivity and well-being is expressed in the following interview excerpt: “They made a big song and dance about work-life balance. I’ve already said that I don’t particularly want to do any more [overtime] during the year, because it gives me a lot of wear and tear. I am committing about 105 percent of my effort already. [My manager] just talked to me about work-life balance and then told me that I need to spend 12 hours a week develop-ing myself and others, in order to be mea-sured against other people, and to do it in my own time” (Robertson Cooper, 2013).

Which brings us to the role of line manage-ment. We know that a person’s immediate line manager is crucial to enabling a satisfactory


Yochanan Altman, Ph.D., is professor of international human resource manage-ment and coordinator of the Mental Health Research Group at Middlesex University London. Email: [email protected].

Clive Morton, Ph.D., OBE, is a professor and lecturer at Middlesex University London. Email: [email protected].

Elizabeth Cotton is a senior lecturer and coordinator of the Mental Health Research Group at Middlesex University London. Email: [email protected].

Roger Kline is a research fellow at Middle-sex University London. Email: [email protected].

Michelle Altman is a psychologist in the City of London specializing in cognitive behavioral psychotherapy. Email: [email protected].

work after recovering from a mental health problem (including substance abuse and addiction) are beneficial to the profits of business. (CIPD, 2014) Surely that’s manna for a banker’s balance sheet.

ReferencesBoddy, C.R. (2010), The corporate psychopaths theory of the global financial crisis, Journal of Business Ethics. 97:1–19.

City & Hackney NHS Trust (2014) information from sources at the Dept. of Psychological Medi-cine, Homerton Hospital.

Fevre, R., Lewis, D., Robinson, A. & Jones, T. (2011) Insight into ill-treatment in the workplace: Patterns, causes and solutions. http://tinyurl.com/socsi-insight.

Harder, H.G., Wagner, S.L. & Rash, J.A. (2014) Mental Illness in the Workplace, Farnham: Gower

Hermann, J. (2013) Stress and the City: Has the banking world gone soft? London Evening Stan-dard Jan., 1, 2013.

Gentleman, A. (2013) Atos comes under attack in emotional Commons debate, The Guardian, Oct., 18, 2013 p. 8

Kessler, R.C., Aguilar-Gaxiola, S., Alonso, J., Chatterji, S., Lee, S. et al. The global burden of mental disorders: An update from the WHO sur-veys, Epidemiologia e psychiatria sociale 18 (1), 23–33

Mind (2014) news item of Nov., 29, 2014 http://www.mind.org.uk/news-campaigns/news/mind-

work environment, as well as in detecting and enacting a response to a mental health episode (Seymour & Grove, 2005; Seymour, 2010). Yet, that remains a pot of luck. At RBS, as is the case with other large organizations, “where managers are sensitive the staff are supported; others will often observe mental health problems but feel unable to intervene for a number of reasons, including not feeling equipped to do so, and then the crisis point can be reached when it becomes too difficult.”

Ultimately, if we were to address the enor-mous challenge that mental health poses in the workplace, there is no recourse but to engender a fundamental culture change, where employee well-being holds not only center stage, but takes precedence over profit. A message the City may not take too lightly.

The silver lining, from a monetary stand-point, could well be that money speaks loud. And the return on investment when it comes to mental health is staggering. Hard-er, Wagner and Rash (2014) calculated the benefits to an employer for managing depression, the most common mental ill-ness. For a business employing 100 people full-time (seven of whom, on average, will have experienced a major depressive epi-sode in the past year, SAMHSA, 2007) and paying an average salary of not more than $20 per hour, the saving would amount to $109,530 per year. The experts’ view is unanimous: Managing a mentally healthy workplace and facilitating a swift return to

reveals-unacceptably-low-spending-on-public-mental-health/#.VFASJochl_k

Office of National Statistics (2013) in http://www.cityoflondon.gov.uk/business/economic-research-and-information /statist ics /Pages/Research%20FAQs.aspx

OnePoll (2014) Survey of 2000 UK adults on behalf of Friends Life. London: OnePoll.

Robertson Cooper (2013) Bank on your people: The state of wellbeing and high performance cul-ture in the financial sector. London: Bank Work-ers Charity.

Robertson Cooper (2014) Bank on your people: The state of wellbeing and productivity in the financial sector. London: Bank Workers Charity.

Substance Abuse and Mental Health Services Administration, 2007 cited in Ganster, D.C. & Rosen, C.C. (2013) Work stress and employee health: A multidisciplinary review journal of management, Journal of Management, 39 (5) 1085–1122.

SCMH (2007) Mental health at work: Developing the business case London. Sainsbury Centre for Mental Health Policy Paper, 8.

Seymour, L. & Grove, B. (2005) Workplace inter-ventions for people with common mental health problems. London: British Occupational Health Research Foundation.

Seymour, L. (2010) Common mental health prob-lems at work London: Sainsbury Centre for Men-tal Health Report.


Ford Motor Company’s Positive Adaption to the Challenges of the Automotive Industry CrisisChris Emmons, Ph.D.

Case StudyRegaining Organizational Health and Vitality

Leaders struggle to keep their organizations alive in rap-idly changing environments. This struggle to adapt and survive—the old notion of the survival of the fittest—was

clearly illustrated by the players in the automotive industry during the 2008–2010 automotive industry crisis. Ford Motor Company’s turnaround is an epic tale of going from the brink of bankruptcy to becoming one of the world’s most profitable automakers. Under CEO Alan Mulally, the leadership team captured the value of organizational health. The Ford story offers several examples of leaders learning from relationships and informal knowledge-sharing. By applying these same learn-ing techniques, leaders in any industry can recognize and seize opportunities to improve and sustain superior performance for their organization.

The ability of an organization to regain vitality and deliver superior performance after an industry crisis is the essence of resilience and organizational health. Organizations adapt and survive over the long term by building capacities for resilience and delivery. The concluding chapter of American Icon (Hoff-man, 2012) described Ford Motor Company as a symbol of American resilience and hypothesized that the Mulally approach of working together and the weekly business plan review was portable to all types of organizations.

The Mulally approach, illustrated through the Ford Motor Com-pany (FMC) story, demonstrates the power of learning from rela-tionships and informal knowledge-sharing. These learning techniques allowed FMC leaders to develop resilience, deliver superior financial and operating performance, and regain organi-zational health.

The work of De Smet, Schaninger, and Smith (2014) indicates organizational health is determined by an organization’s “abil-ity to align around a clear vision, strategy, and culture; to exe-cute with excellence; and to renew the organization’s focus over time by responding to market trends.” Alan Mulally incorpo-rated all three determinants of organizational health into the


One Ford plan. Mulally began writing this plan after his initial interview with Bill Ford during the plane ride home from Detroit to Seattle on July 30, 2006.

Using a blank piece of notebook paper, Mulally jotted down several word and phras-es: performance, product, process, people, leadership counts, too much capacity, down-ward pricing pressure, great competitors, auto culture, and key financial metrics. Mulally’s stream of consciousness began with his goal to make the world’s best cars with profitable growth for all. To this day, the goal of One Ford remains “an exciting viable Ford delivering profitable growth for all.”

How could Mulally so quickly and accu-rately define a goal that stands the test of time? After only one meeting, how could Mulally outline the foundation for a plan that delivered superior performance over the long-term and incorporated all three deter-minants of organizational health? Because Mulally knew the right questions to ask dur-ing his initial meeting with Bill Ford.

Asking the Right QuestionsAnyone who interviews for a new job under-stands the value of learning as much as pos-sible about the challenges facing the organization prior to the initial meeting. Some realize asking good questions during the interview builds on their understanding of the organization and its challenges. Yet few show the level of discipline illustrated by Mulally. Asking the right questions involves three interrelated actions: conducting research, posing inquiries, and reflection (see Exhibit 1).

EXHIBIT 1. FRAMEWORK FOR ASKING THE RIGHT QUESTIONS

Hoffman’s 2012 portrayal of Alan Mulally included multiple examples of this executive conducting research, asking questions, and reflecting. When FMC board member John Thornton called Mulally to tell him that Bill Ford wanted to talk to him about running the company, Mulally’s first action upon hanging up the telephone was to rally his family. His children searched the Internet and forwarded information about the com-pany and the Ford family to their father. Mulally also conducted his own research to learn everything that he could about FMC and the automotive industry.

During Mulally’s initial meeting with Bill Ford, Mulally asked a number of intense questions, including inquiries into the ratio-nale for so many brands, the strength of the dealer network, and why global assets weren’t leveraged.

After the meeting, Mulally demonstrated reflection by sitting down at the desk in his hotel room and jotting down concepts from the discussion on a blank piece of paper—about Bill Ford, his home and family, the opportunity at Ford Motor Company, as well as the challenges presented. This pro-cess of jotting down concepts and taking time to think allowed Mulally to consider whether moving forward was the right deci-sion for him, which propelled Mulally to the next set of ‘right’ questions. Was there enough money left to save FMC? Was there enough time for him to make a difference? (Hoffman, 2012)

In this example, research and reflection were primarily individual activities. However, the research would not be accurate or complete without successful inquiry. Not only did Mulally have to be prepared to probe deeper, but Bill Ford also had to be willing and able to answer questions about the challenges FMC faced. This is the essence of a knowl-edge-sharing relationship.

Knowledge-Sharing RelationshipsKnowledge is an important factor for orga-nizational health. Knowledge sharing is a significant tool for building capacities for resilience and the delivery of superior perfor-mance. Noted knowledge management authority Larry Prusak argues the key to prosperous organizations is knowledge shared through relationships.

Yet, the emphasis in the phrase knowledge sharing is often on the formal methods of shar-ing knowledge, particularly technological approaches such as stored documents and sponsored networking platforms. The knowl-edge-sharing literature has predominately focused on the ability to share knowledge via technical approaches (Wang & Noe, 2010) with limited consideration of the inclination to share knowledge via relationships. Even so, the literature suggests that the technical abil-ity to share knowledge is either diminished or enhanced by the inclination to share knowl-edge.

Knowledge-sharing relationships are inter-personal relationships defined by the ability and the inclination to share knowledge rel-evant to organizational performance improvement initiatives. The emphasis in the phrase knowledge-sharing relationships is on relationships and the informal nature of the knowledge sharing that occurs during dialogue and other personal connections.

Peter Senge defined dialogue as the ability of participants to think together. Thinking together requires the interactions of research, asking questions, and reflection. Senge also discussed a role for dialogue where the focus is on acting together by reaching agreement and making decisions to create the desired results. Senge claimed that teams, not indi-viduals, are the fundamental learning unit in organizations. Comparing a team to a jazz ensemble, Senge concluded what really mat-ters is knowing how to play together.

Connectors and CollaboratorsOne type of knowledge-sharing relationship is a connector. Connectors identify information and people valuable for performance improve-ment initiatives. In the late 1980s, Mulally was chief engineer for a new jet program and then–FMC CEO Donald Petersen was a member of Boeing’s board of directors. Petersen suggested Mulally study Ford’s work on the Taurus. As a connector, Petersen introduced Mulally to Lew Veraldi, the leader of Team Taurus. Mulally was speaking with Ford personnel and studying FMC’s successful performance improvement initiative almost two decades before he became Ford’s CEO.

Team Taurus illustrates a second type of knowledge-sharing relationship, collaborators: individuals who think and act together on an organizational performance improvement ini-


tiative. Veraldi assembled a cross-functional team of designers, engineers, purchasing staff, marketing personnel, and representatives from manufacturing. This ensured input from the assembly line, suppliers, and dealers who knew what customers wanted. Taurus became the bestselling car in America, at nearly $500 mil-lion under budget.

During his career at Boeing, Mulally wrote an introduction to a book on teamwork titled Working Together (Lewis, 2002). Mulally’s introduction focused on compo-nents of relationships at work: interdepen-dence of task and customer focus; inclusion and importance of each individual to the plan; transparency; listening; helpfulness; celebration; and enjoyment.

Mulally implemented the “Working Togeth-er” approach at Boeing. Working Together requires the leadership team to share knowl-edge by meeting every week to review their progress, discuss problems, and decide how to address their challenges—to think and act together—as a learning and performance unit. By 2006, Boeing’s commercial jet divi-sion was on its way to record sales, revenue, and earnings. Mulally credited Working Together for these results.

Mulally’s approach of working together and the weekly business plan review is similar to Senge’s thinking, acting, and playing togeth-er. Mulally’s approach requires the team, a learning unit, to use dialogue and personal connections to fully benefit from informal knowledge sharing and, in turn, create the desired results.

Working Together and the Business Plan ReviewBased on his belief that the leadership team decides the company’s direction, Mulally dis-solved the FMC strategic planning group a few months after his arrival in September 2006. As with his earlier use of the Working Together approach, Mulally turned the leadership team into a learning and performing unit. The weekly business plan review (BPR) was held on the same day at the same time. Attendance was mandatory for all senior executives. Each executive was given a set of slide templates and expected to fill in the blanks with the real data.

FacilitatorsLeaders are often facilitators of the interper-

sonal relationships between collaborators. As facilitator of his first business plan review with the FMC executive team, Mulally need-ed to share a vision for the business plan review process before he could share a vision for FMC. The BPRs were a significant change for these executives. As the executives took their places at the table, Mulally pointed out the list of 10 rules posted on the walls. He reviewed the list with the group, placing emphasis on a few points, such as no side dis-cussions or jokes at another’s expense.

After the review of the ground rules, Mulally presented his first slide with a blue oval labelled “Vision” in the center. As with the original goal of One Ford, this vision remains intact as “One Team: People working togeth-er as a lean, global enterprise for automotive leadership as measured by customer, employ-ee, dealer, investor, supplier, union/council, and community satisfaction” (FMC, 2014). The shared vision did not happen immedi-ately, but Mulally was consistent, led by example, and enforced the ground rules and the process without exception. A shared vision generates the will to build capacity for resilience and deliver superior performance.

What Matters to Leaders? Recent research has found that the main concern of leaders is the personal impact they make on improved organizational per-formance (Emmons, 2013). When the FMC board asked Bill Ford to consider bankrupt-cy, Ford wondered, “What would Henry Ford think of his company today? What would he think of me?” And while Mulally was flattered by the opportunity to run FMC, he pondered, “Can I still make a dif-ference, or is it too late?” During his first month, he presented his plan to transform FMC and shared the mark he intended to make. He labeled the latter “Alan’s Legacy.”

Mulally was well on the way to establishing his legacy during his first year. He continued to research, inquire, and reflect as well as build knowledge-sharing relationships. He met with engineers, read engineering sche-matics, visited the product development cen-ter, drove different vehicles, called industry experts, spoke with Ford’s financial advisers, commissioned studies, and read old financial reports, white papers, and internal studies. Mulally ate in the company cafeteria and per-sonally responded to emails. He even met with then–CEO of General Motors, Rick

Wagoner, to ask questions about business cycles, product strategy, and negotiations with the United Auto Workers and dealings with the Environmental Protection Agency.

Mulally saw FMC’s inefficiencies as opportu-nities to consolidate and simplify. When Mulally reviewed the Way Forward accelera-tion plan, he noted the plan cut costs yet neglected the need to make cars consumers wanted to buy. In the automotive industry, a successful business model requires lean bud-gets and strong brands. At FMC, the brands had lackluster designs and poor quality.

It is not enough to recognize opportunities for consolidation, simplification, and response to customer demand. The act of clarifying the customer value proposition and profit for-mula is a group, rather than solo, perfor-mance. Mulally’s team had to determine the best way to seize those opportunities.

Through the business plan review, the exec-utive team began to share purpose, become

Top ‘Must-Dos’n Learn as much as you can about your

challenge. Talk to customers and employees on the front line. Seek information from a variety of sources. Eat in the company cafeteria.

n Use the framework for asking the right questions. Make inquiries based on your research. Reflect by jo t t ing down your s t ream of consciousness on a pad of paper.

n Nurture relationships with connectors, collaborators, and allies. Learn and practice facilitation skills. Find mentors and serve as a mentor. Assume or assign the role of disseminator. Narrate the story of pe rsona l and o r gan i za t iona l success.

n Turn your team into a learning and performing unit. Build capacities for resilience, organizational health, and the del i ver y of super io r performance. Think, act, and play together to recognize and seize opportunities.

n Implement the business plan review process.


engaged, build capacity, and demonstrate leadership. They worked together to strengthen the brands with improvements in both design and quality of the products in addition to cutting costs. Just nine months after Mulally’s arrival, FMC was in the black for the first time in two years.

In spite of the progress, the 2007 unraveling of the subprime mortgage market drastically reduced the availability of credit, while unemployment rates rose, and automotive sales plunged.

In March 2009, President Obama addressed the nation and acknowledged that the diffi-culties of the automotive industry were strongly related to the weaknesses in the economy. However, the president made it clear that the industry had not been man-aged well for decades. While offering sup-port to spur automotive sales, Obama challenged the industry to once again pros-per and provide opportunities. Mulally told his executives that the president’s challenge was their opportunity to make history, say-ing, “You’ve spent all of your working lives waiting to make a difference. Well, now is your time. This is about the soul of American manufacturing, and you’re part of the solu-tion” (Hoffman, 2012).

Leaders who care deeply about their organi-zations, the work they do, and the people they influence use a process called positive adaptation to achieve their personal impact.

The Positive Adaptation Process Resilience is the ability of an organization to address a challenging condition by making a positive adaptation. Mulally’s experiences at Boeing and during his first nine months at FMC illustrate how the interrelated actions of research, inquiry, and reflection foster the ability to ask the right questions and then recognize and seize opportunities to improve organization performance (see Exhibit 2).

To regain organizational health and deliver superior performance after the automotive industry crisis, FMC had to demonstrate resil-ience. Knowledge sharing and relationships are enabling conditions (Sutcliffe & Vogus, 2003) that build resiliency at an organiza-tional level. As Mulally explained to his execu-tive team, they needed to work on a better plan at the same time they checked progress against

Mentors and InfluencersBeyond connectors, collaborators, and facil-itators, there are several other types of knowledge-sharing relationships. A fourth type of knowledge-sharing relationship is with a mentor, someone who provides con-structive feedback to an individual. Mentors are often higher-level executives and manag-ers valued for their seasoned insights.

A fifth type of knowledge-sharing relation-ship is with an influencer. Similar to a mentor, an influencer provides insights and construc-tive feedback to an individual. The difference is that the interpersonal relationship is more limited than the close working relationships between a boss and subordinate or two peers. An influencer could be an individual briefly encountered or indirectly encountered, such as a writer or a public speaker.

When Mulally informed Jim McNerney, his boss at Boeing, that he had been offered the top job at FMC, McNerney responded with the potential that Mulally could play a larg-er role at Boeing. Mulally decided to stay.

When Ford informed the board, John Thorn-ton, former president of Goldman Sachs, and the board member who first suggested Mulally as a candidate, offered to call Mulally. Thornton, an influencer, appealed to Mulally on the basis of the personal impact he could make as CEO of FMC. Ford sent Joe Layman, human resource director, to Seattle. Layman, also an influencer, reminded Mulally that he did not need to wait for Boeing to expand his role; FMC provided Mulally with an immediate oppor-tunity to run a Fortune 10 company. Mulal-ly accepted FMC’s offer.

Allies and DisseminatorsThat same year, 2006, Mark Fields, Ford Americas president, had had ambitions to be CEO. Mulally’s appointment was disappoint-ing to Fields, and some reporters stoked rumors that Fields’ days were numbered. When Daniel Howes of the Detroit News called Fields with this speculation, Fields went straight to Mulal-ly to find out if he was being fired.

Mulally acted as Fields’ ally, a person who stands by another individual, informing him (and later Howes) that he was a valued mem-ber of the team.

the current plan. An organization learns from its early adaptations by building competencies for future adaptations, making the positive adaption process a continuous one.

EXHIBIT 2. MODEL OF THE POSITIVE ADAPTATION PROCESS.

FMC learned how to make money in a down market. No other American automaker had done that before. Ford posted a profit of $6.6 billion for 2010. It was the most money the company had made in more than 10 years. Under Mulally, the leadership team captured the value of organizational health and remains one of the world’s most profitable automakers.

Successful groups function as both learning and performing units. Studying the practices of successful units offers insight into how groups recognize and seize opportunities. It is in the study of groups as learning and per-forming units that the value of knowledge-sharing relationships becomes most apparent. Research suggests knowledge-sharing rela-tionships support all three stages of the posi-tive adaptation process (see Exhibit 3).

EXHIBIT 3. KNOWLEDGE-SHARING RELATIONSHIPS SUPPORT ALL STAGES OF POSITIVE ADAPTATION.

➤


Chris Emmons, Ph.D., is a perfor-mance consultant who designs and delivers workshops and other initia-tives to increase the effectiveness of leaders and team members. Strategic planning, change leadership, employ-ee engagement , and innovat ive approaches to knowledge manage-ment are the foundation of her prac-tice. Her recent research involves improving organizational perfor-mance by building organizational resilience and sustainability through knowledge-sharing relationships. Chris can be reached at [email protected].

As both mentor and ally, Mulally’s attention to his relationship with Fields has allowed the two men to work successfully together during the FMC’s initial turnaround (2006–2007), the global economic crisis (2008–2009), and FMC’s triumph of becoming the most profitable automaker in the world (2010). In July, Mulally stepped down and Fields was named the new chief executive. Both Mulally and Fields were confident the transition would be smooth, as the team and processes were already in place.

A disseminator spreads news and information important to an organization’s performance improvement opportunity. After Mulally had been with FMC for a month, he sent an email to Ford’s employees around the world titled First Impressions. In the email, Mulally compli-mented Ford’s workers, outlined the chal-lenges as well as the opportunities ahead, and offered a compelling message of the future changes and success: “Everyone loves a come-back story. Let’s work together to write the best one ever” (Wall Street Journal, 2006).

During the U.S. economic crisis, Mulally went to Washington to pass on the bailout. In his speech to Congress, Mulally acknowl-edged the business model needed to change and that FMC had changed in the last two years. He explained, “This is the Ford story. We are more balanced. We are more effi-cient. We are more global. And we are really focused…. Ford is an American company, and an American icon. We are woven into the fabric of every community that relies on our cars and trucks and the jobs our com-

pany supports. The entire Ford team, from our employees to shareholders, suppliers to dealers, is absolutely committed to imple-menting our new business model and becom-ing a lean, profitable company that builds the best cars and trucks on the road for our customers. There is a lot more work to do, but we are passionate about the future of Ford” (Detroit Free Press, 2009).

This move distanced FMC from competitors GM and Chrysler and allowed the company to capitalize on its choice to decline the gov-ernment bailout. When Mulally went to Washington to make the announcement, he was accompanied by his press aide, Ford Americas group controller, and the vice president of government and community relations, a group that had collaborated and determined together what face Ford would put forward to Congrees and the public.

Creating OpportunitiesIf there’s anything to be learned from Ford Motor Company’s positive adaption to the automotive industry crisis, it’s that unlike competition, macroeconomic forces, and market dynamics, leaders truly can impact organizational health.

Baldwin (2002) described “a dance of inter-sections and connections between myself and other people and the opportunities we create as we cross each other’s paths.” Knowledge-sharing relationships and the positive adaptation process promote this dance and present opportunities. By apply-

ing these techniques, leaders in any industry can recognize and seize opportunities to improve and sustain superior performance for their organizations.

ReferencesBaldwin, C. (2002). The seven whispers. Novato, CA: New World Library.

De Smet, A., Schaninger, B., & Smith, M. (2014, April). The hidden value of organizational health—and how to capture it. McKinsey Quarterly.

Detroit Free Press. (2009, December 15). Mulally’s speech in Senate: ‘We are more efficient ... more global’

Emmons, C. (2013). Improving organizational perfor-mance: Building organizational resilience and austain-ability through knowledge-sharing relationships.

Ford Motor Company. (2014). One Ford.

Hoffman, B. G. (2012). American icon. New York, NY: Crown Business.

Lewis, J. P. (2002). Working together: 12 principles for achieving excellence in managing projects, teams, and organizations. New York, NY: McGraw-Hill.

Prusak, L. (2006, April). The world is round. Harvard Business Review, 84(4), 18-20.

Senge, P. (1990). The fifth discipline. New York, NY: Doubleday.

Sutcliffe, K. M., & Vogus, T. J. (2003). Organizing for resilience. In K. S. Cameron, J.E. Dutton, & R. E. Quinn (Eds.), Positive organizational scholarship: Founda-tions of a new discipline. San Francisco, CA: Berrett-Koehler.

Mulally’s ‘First Impressions’ (2006, December 22). Wall Street Journal.

Wang, S., & Noe, R. A. (2010). Knowledge sharing: A review and directions for future research. Human

Resource Management Review, 20, 115-131.

Types of Knowledge-SharersConnectors: Identify information and people valuable for performance improvement initiatives.

Collaborators: Think and act together on an organiza-tional performance improvement initiative.

Facilitators: Guide interpersonal relationships between collaborators to generate a learning and performing unit capable of seizing opportunities.

Mentors: Provide construc-tive feedback to an individual.

Influencers: Provide insights and constructive feedback to an individual, but with a more limited interpersonal relationship than a mentor.

Allies: Stand by an individual to support a potentially controversial idea or action required to contribute to improved organizational performance.

Disseminators: Spread news and information important to an organiza-tion’s performance improvement opportunity.

Narrators: Move beyond spreading the news to telling the story of an organizational performance opportunity—a compelling message about current challenges and future successes on a personal and organizational level.

People Strategy

PeopleStrategy

People&People

&People

Theme of the Upcoming Issue One of the Five Knowledge Areas that has de� ned HR People and Stragegy for more than a decade is Build-ing a Strategic HR Function, de� ned as enhancing the impact of the profession by:

• Ensuring functional excellence within the human resources organization

• Maximizing HR’s impact

• Validating HR’s effectiveness

• Solidifying HR’s perception and reputation

• Developing solid measurement and reporting tools

To better serve the senior segment of HR, HRPS is now af� liated with SHRM and cares deeply about providing the leadership needed to bring the Human Resources profession to the next level of impact. This Special Edition of the People & Strategy journal will explore where we are as a business function and what we need to do to truly “Elevate the Profession.”

This is an interesting topic with a history of its own, and the journal does not intend to re-run the old mantra of “why we can’t get a seat at the table” and the inferiority complex that goes with that. Rather, we will optimisti-cally and positively explore what we can do to create our own future and to increase both the reality and the perception of the organizational contribution that HR can bring.

In May 2014 a signi� cant milestone in the history of the HR profession occurred. The Board Chair of the leading HR professional association, SHRM, announced: “The differentiator for HR professionals will not be what you know, but what you can do with what you know. SHRM has a responsibility to lead the profession toward a certi� cation process that proves competencies. That will bene� t the individual, the profession and employers by aligning HR with the changing demands of business.” The Journal will take a larger perspective on “leading the profession” with a focus on HR’s professional stature and its evolution as a key business function. We will also take a global perspective on the varying accreditation requirements of different countries.

Other professions have certi� cations based on a well-accepted “Body of Knowledge” and HR to date does not have agreement on its profession’s “Body of Knowledge”. We will want to explore the methodologi-cal rigor required to create a “Body of Knowledge” for HR. Ultimately, we are looking for both research and thought leadership on how HR can make the next jump forward in its evolution.

Topics to Consider For the People & Strategy Fall 2015 Issue on Certi� cation and Assessment we are looking for a diverse collection of evidence-based articles oriented toward senior practitioners in management positions. Contributions are expected to provide the latest research and practical insights into both where the HR profession is going and how professionals in it should be certi� ed and accredited. We would like the

viewpoint of other functions on how they think about professional certi� cation in their area (e.g., � nance, marketing, legal). Submissions, in general, are expected to address the following set of questions, though this list is not limiting:

• Has research and fact-based studies on the future of HR

• Reality vs. perception on the impact of HR

• The global view on the HR profession and its future

• Developing a comprehensive “body of knowledge” for HR

• Trends in competency assessment and professional certi� cation (not just in HR)

• Debate on creating, implementing and assessing the impact of competency models

• The role of universities, colleges, associations and organizations in elevating the profession

• Book reviews

Our Audience The typical reader of People & Strategy is an internal human resource executive or consultant seeking actionable and practical advice based in sound research. Our reader wants to be challenged by new models, approaches, and ideas. Our readers are experienced, knowledgeable and work in and for a variety of organizations across the globe. They turn to People & Strategy for clear, actionable, and thought-provoking articles on current topics.

Types of Submissions Articles can take a number of forms including frameworks for understanding and taking action on a topic, presentation of research � ndings with interpreta-tion, case studies illustrating best practices or essays advocating new ways of thinking about an issue. Articles from consultants are especially interesting when they are written collaboratively with practitioners from a client company. We are also interested in book reviews. Please do not submit literature reviews or purely theoretical pieces. Submissions will be reviewed by members of the journal’s editorial review board. Criteria for evaluation include signi� cance of contribution to the � eld of human resource management; usefulness of knowledge; timeliness of content; originality; provocative nature of content; quality of the data supporting the points; logical; and well-written. The reviewers’ comments will be sent to authors. The � rst step is to submit a one-page proposal and the author’s bio by April 15, 2015 (see timetable). If accepted, we will then guide you on the development of your article.

Writing Style and GuidelinesArticles can range from 2,000 to 2,500 words. Perspectives articles range from 500 to 700 words. Book reviews should be 500 words. See example of former issues articles here: http://www.hrps.org/?page=PSArticles. We are looking for articles that have the following attributes:

• Strategic importance. Has a link to business

decisions and doesn’t rehash well-known information; your article should be the type an HR reader might pass on to a business executive to educate him or her about a concept, provide the basis for a discussion, or to in� uence thinking.

• Impact. Has practical use for the HR executive reader, as well as a business reader; for example, does not just present research � ndings but also discusses applications.

• Actionable. Focuses on solutions, not just descriptions of issues.

• Grounded. Based on research, theory (with examples), or proven practice to provide a “proof of concept,” not just armchair observation; provides frameworks that can be applied in a variety of situations.

• Point of view. Makes a case for thinking about a topic differently.

• Readable. Nonacademic prose; active verbs and minimal jargon.

Publication Timetable and Submission Information All proposals should be sent electronically to Anna Tavis, Executive Editor, People & Strategy at: [email protected]. (No hardcopy submissions will be accepted.)

Please designate in your email that this submission is for the Fall 2015 Issue—HR’s Emerging Role in Corporate Governance. Please indicate if your article is based on any prior publication or is also currently submitted to another publication for consideration.

April 15, 2015–Proposals due: Submit a one-page overview of article concept and author’s bio.

May 1, 2015–We will provide feedback and direction on your concept.

June 1, 2015–Articles due: Submit a well-written draft ready to be edited.

July 1, 2015–We will indicate if the article is accepted, and, if so, what revisions are needed. If your article is accepted, we will work closely with you to shape and revise it to meet the � nal submission deadline. All articles are in edited � nal form by August 1, 2015.

Review ProcessContributions will be reviewed by a committee, and each paper will get at least three independent reviews, based on criteria including relevance, clarity, soundness, and power of the arguments, generality of results/claims, and novelty. Papers will be accepted based on this criteria and space availability. Accepted papers will be published in an attributable form in the Fall 2015 edition of People & Strategy.

Copyright PolicyHR People & Strategy retains the copyright to all content published in the People & Strategy journal.

CallPapersfor

HRPS People & Strategy Journal 38.4 (Fall 2015)

Elevating the HR Profession: Certi� cation and Assessment

Special Editors: Dr. John Boudreau and Dr. Richard Vosburgh

Executive Editor: Dr. Anna A. Tavis


Fostering Organizational Health and WellnessA Conversation with Dr. W. Warner Burke

Michael Bazigos: To begin, there are two terms in this special issue’s title: organiza-tional health and wellness. How do you understand each of those terms, and how would you defi ne them?

W. Warner Burke: I like the question because wellness is an outcome and health is a pro-cess, so that’s the fundamental difference between the two. Obviously, we are talking about the same domain of life, but I would think that from the standpoint of trying to understand those terms vis-à-vis an organiza-tion whose leaders’ ultimate objective is to make the organization as well as possible. So wellness is always a desired outcome and an objective. But to get there you have to focus on issues of health, and I don’t believe that most executives understand what that means, or are necessarily equipped to build and sus-tain the health of the organization. It’s interesting that people in organizations invoke the health metaphor, for example, “How sick can that decision process be?” or, “Well, last night when I got us into the won-derful land of wellbeing.” So, we do use the language. When I say “we,” I mean organiza-tional members in general.

For example, here at Teachers College, we use language like that all the time. The word toxic is now in vogue, and has been for quite some time. We talk about toxic leaders; we talk about toxic organizations and so forth. And so the antidote to all that is health and well-

ness, but we’re focused on the negative. This obviously contravenes the literature on posi-tive psychology which validates that we focus unduly on negative aspects of organization behavior and insuffi ciently on the positive aspects. We do need to focus much more on the positive.

Positive psychology research has shown unequivocally that when practiced, it leads to healthier organizations, and people feel bet-ter when they focus on positive things. Now, that can obviously go too far, and it can become tired and heavy. But it is nevertheless out of balance in most organizational life, meaning that negative aspects—toxic aspects take more of our time, energy, and effort than positive ones. To get the same benefi ts, we have to work almost two to three times harder under negative conditions than we do under positive ones.

MB: What would you describe as the charac-teristics of a healthy organization? Let’s take it from the positive side fi rst.

WWB: I think that anything that helps people in the organization avoid paranoia can lead to much healthier situations. When others are closed and not open—when we don’t know what’s going on and why people are making decisions that we can’t make, and things of that nature—that leads to “what” thinking: “What am I doing that people are trying to get me for?” and so forth, and that can indeed

lead to feelings of stress—the opposite of wellness. For example, I was just talking to a colleague yesterday who mentioned how stressed she felt and had, she said, one of the worst headaches she has ever had. So there is a direct connection between how we perceive what is going on in an organization and our feelings in terms of wellness.

That argues, from my point of view, for orga-nizations to be far more open than they are and allow people to express themselves with-out fear of retribution. It argues for an open system on the broad sense of that term where people can feel that what is being discussed is actually honest. And it argues for a system where people use the word integrity more often than they use the word toxic.

MB: Let me pick up on the word system. You just talked about an open system and you were talking about an open and trusting cli-mate. What can organizations do to foster that? What needs to go well at a systemic level?

WWB: We tend to talk about problems with respect to the culture. Well, you know, that means you are going to have to go into a huge effort of trying to change the culture, and that’s going to take years. So I think it is far better to concentrate at the local unit level in terms of the climate— how people are work-ing together and how they feel about their boss and things of that nature. That’s the level within the system where you get the biggest and fastest payoff, the work-unit level.

There are such things as clarity: how it’s just so important for people to be clear about what’s expected of them; that’s a climate dimension. [And] standards: are people man-aged according to standards, or does the management process come across as purely arbitrary? The difference between those two has a major effect in terms of how people feel about their work situation. Recognition informally, you know, the pats on the back

THOUGHTLEADERS

People & Strategy special editor, Michael Bazigos, Ph.D., recently had the opportunity to interview Dr. W. Warner Burke, Edward Lee Thorndike Professorship of Psychology and Education; education program coordinator for graduate programs in social–organizational psychology; and former chair of the Department of Organization and Leadership at Teachers College, Columbia University.

The interview was as wide ranging as the topic area, and touched on a variety of examples of healthy and unhealthy management—performance management, rewards and recognition, culture, climate and leadership—as well as the state of research linking organizational health to company performance and Dr. Burke’s view of a critical success factor in organizational transformations which CHROs will especially want to note.


THOUGHTLEADERS

The healthy organization is one where the chief executive offi cer and the chief human resource offi cer get along and work together.

and stuff of that nature, are important. And mutual support: I don’t feel like my team members are trying to stab me in the back. I feel quite the opposite, that they’ve got my back!

Culture is the overall context for climate. Our culture is always in the background, and cli-mate is in the foreground. You can have an effect on climate in 24 hours. If people feel tomorrow much clearer about what’s expect-ed of them and they do it today, that’s you perfecting climate. So, that’s this part of the system, thinking where the major effort needs to be made.

MB: Are there system-level effects that can constrain or enable a climate? I recall a glob-al company where managers were famous internally for defl ecting blame upwards. For example, during the annual performance and salary review cycle, your manager would con-vince you that you, personally, were gold. But management had tied his or her hands with a forced distribution on performance scores and a tiny allocation for increases and bonus-es. That found its way into upward feedback survey results where the message at every job role level was, “I love my manager but I hate management.” Taking that as an example of a system-level constraint, what does senior management need to be thinking about in terms of making the organization healthier?

WWB: The reward system is a good example. It is the most important because people do what they are rewarded for doing and that’s one of only two or three truths in psychology! I think though that too many managers, too many executives think that reward has to do with money and so it’s the fi nancial incentive that drives the way of thinking about rewards rather than helping a person to change their job to another job that’s more challenging, one they would see as fun, that would take more advantage of their skills, and so forth. That can be extremely rewarding.

There is just too much emphasis on the dol-lars and not enough emphasis on helping people enjoy their work life better and enjoy-ing their work life better would mean having just a very interesting job and having oppor-tunities for movement in the organization to other jobs that are interesting and exciting, without necessarily it being a promotion. That’s a gap as far as I’m concerned with respect to how people think about rewards.

I’m amazed at how people in the corporate world don’t consider a brief sabbatical as a reward and how we in academia do—that’s one of the reasons we stay in academia.

MB: Is it still one sabbatical every seven years?

WWB: Yes, that’s right. It’s very biblical; it’s every seventh year. An old colleague and friend of mine used to say there are four won-derful things about being a professor: sabbaticals, and June, July, and August! In other words, time is precious, and giving people a little more fl exibility with respect to how they use their time and providing time for refl ection and learning can go a very long way with respect to building a healthier orga-nization in general, and providing fl exibility with respect to a reward process. In corpora-tions, a sabbatical can be one month—and that makes a difference. I have talked to people about what a difference it makes.

The other thing I would want to emphasize is—and this has to do with a broader concept than rewards but it can be very, very reward-ing—the need to operate more and more on a team basis so that people are not in isolated positions in terms of their daily jobs, but are perceived that what they are doing is a part of a group effort. The reward process of that can be, “I’m part of something that’s bigger than I am and more important than just what I do,” and it’s related to six other people that have offi ces close by, for example.

It is pretty clear now that the way to deter-mine the effectiveness of a person in a position of leadership is not so much what that person does on a daily basis but what that person’s followers accomplish. So, leadership, in my judgment, should be measured much more in terms of what the leader’s people do, not so much in terms of what the leader does.

You pay attention to what the leader does, of course, but the major objective with respect to making decisions about selecting a reward


THOUGHTLEADERS

should be what followers accomplish. The more you focus on that, the more you’re emphasizing teamwork and what followers as a group accomplish as a team.

An effective leader has two primary objec-tives for effectiveness and one is selecting the right people and paying attention to hetero-geneity in terms of the group that’s working with you. And then fi nding ways to help that group of people that work for you to work together. Those two things, selection and teamwork, are the two most important fac-tors, I think, in terms of assessing the effectiveness of an executive or manager.

But I’m also talking about what can be rewarding and as I have always said being part of something that’s “bigger than I am” is rewarding. For example, my life here at the college includes six or seven different pro-g r a m s , a l l u n d e r t h e l a b e l o f “social-organizational psychology,” and it’s that collective part that is the most satisfying for me. It’s what we all accomplish together to have a coherent look.

MB: That’s a good example. So many orga-nizations assess individuals at the end of the year and reward individuals on what their unique contribution has been according to some guidelines. Do you see potential for any disconnects when we look increasingly for teams to do the work effectively, but then reward individuals?

WWB: Well, that’s a very good point. And disconnect is the right word in that what that practice does is reinforce individuality rather than teamwork; it works against what it is that you are trying to do with respect to hav-ing a healthy organization and people feeling like they are part of something that’s impor-tant in their lives. So, yes, big disconnect.

MB: I think we’re agreeing that performance management and the line of sight from strat-egy to behavior to reward are important aspects of organizational health. An over-whelming majority of companies surveyed are dissatisfi ed with the effectiveness of that process, yet they are unwilling to drop their existing processes without a viable alterna-tive. I wonder if you have any thoughts about how that impacts health?

WWB: It’s the fundamental issue of the con-fl ict between performance and development: organizations err on the side of performance

and rarely pay attention to development. It’s development that gives you the biggest pay-off, rather than focusing on the individual manager’s bottom line. In other words, has he or she grown people? The people who worked for this person, what’s happened to them? We just do not pay suffi cient attention to devel-opmental kinds of activity and reward them.

So, you may have produced some dynamite people for the last two years, but they have moved on—because you helped that pro-cess—but you don’t get anything for that. There’s a disconnect when some people say, “I’d like to work for Michael,” but then Michael gets no reward or recognition.

MB: Warner, let’s just switch gears a little bit and talk about the relationship between orga-nizational health and organizational performance. At McKinsey, we’ve established a link between organizational health and long-term total return to shareholders.1

That’s just one example of a modest but growing body of research. Ben Schneider is a great example of academic researchers estab-lishing linkages between soft things like culture and health on one hand, and hard outcomes like return on investment, return on net assets, and sales. I remember you intro-ducing us to [J.P.] Kotter and [J. L.] Heskett’s book, Corporate Culture and Performance in the early 1990s.2 Donning your academy garb for a moment, what is the state of that linkage research today and what are we learn-ing?

WWB: My impression is that the state of that research is dormant because I have not run across any lately. By the way, I don’t read every journal article that comes across my desk. But I do look at the contents of every journal.

You know, maybe we should look at the pro-fessional literature in Denmark and some other places where they are doing research like this.

MB: Specifically, Denmark or you’re just using Denmark as an example?

WWB: Well, they are enlightened people in that matter, that’s for sure, as they are in Swe-den and the Nordic parts of the world in general. I don’t know specifically, but I’d speculate that’s a great place to look.

MB: Do you believe that this research is now dormant because it’s now a received message that leaders are either predisposed to believe or not, and will continue to use correlational studies to reaffi rm their biases until a defi ni-tive cause-and-effect study is published one day?

WWB: Well, that’s a good point because the Kotter and Heskett study, as much as I admire it, was really hard to draw direct links between cause and effect from. It had more of a correlational nature in terms of their research design, but it was very suggestive. I have referred to it many times over the years, but boy, you just can’t fi nd any other studies like that.

I think another factor here is obviously what research gets published, because there are probably some informal studies that have gone on. They never got published, but we would love to see them. What gets published, of course, are those things that are method-ologically very rigorous, but the more rigor that exist in the study, the less relevance.

MB: To business folks, is that what you mean?

WWB: Yes, that’s what I mean. Most of the articles that are published in top-notch jour-nals are written by people who are trying to get tenure, and that tenure process drives what gets published, not so much what might be really needed.

MB: Do you believe that there is a link between organizational health and perfor-mance?

WWB: Yes.

MB: What is the evidence base that you think of when you think about that linkage?

WWB: There is that study by Sonnenfeld and some others published in the Administrative Sci-ence Quarterly about the work of the top team—and how they worked together at the top had a direct infl uence on the bottom line. 3 And the more they modeled, so to speak, working together and enjoying one another’s company rather than a big competitive process, the bet-ter and the higher performance. That’s about the only study I can think of that comes close to what you are talking about.


THOUGHTLEADERS

MB: What did you observe in your consulting and your own research with the Burke-Litwin Model of Organizational Performance and Change4 over the years?

WWB: I’m thinking of the SmithKline Bee-cham merger, and the degree of attention that was paid to representativeness of the two companies as they merged—in terms of posi-tions of power and infl uence— with respect to appointments of people. I worked with the top team to get them to be more of a team, and I think that the objective of the merger—to make these two companies really become a global player together—was realized. That meant transcending the American part of it and the British part of it, and going beyond that. I was there for about three and a half years and did multiple surveys, using the Burke-Litwin Model for understanding what was going on. The data always seemed to point to leadership having a direct effect on how the other elements of the model worked.

I can’t point to many successes I’ve had with respect to culture change and mergers and acquisitions, but I had three successes, British Airways, SmithKline Beecham and Dime Sav-ings Bank. Those were three that worked. And a common denominator across all three was the combination of the chief executive offi cer

and their chief human resource offi cer work-ing together. What I did in many respects was to facilitate that engagement of the HR head and the CEO and not get in between, because the CEO listened to what the chief human resource offi cer had to say, and what I would do is reinforce that as much as I could. Suc-cessful organization change has to be a combination of not so much the CEO or chief fi nancial offi cer, but the CEO and the chief human resource offi cer also have to have a reasonable amount of savvy about organiza-tion change currently out there.

MB: And what do you think the state of that is?

WWB: I don’t think it’s great. There has almost been an antagonism between HR and OD (organizational development) in many organizations and where that is not the case, the companies seem better run or to operate better. The power of the HR position is so overlooked in terms of its potential. There hasn’t been a whole lot of competence in terms of organizational development, but where there is, it pays off.

The healthy organization is one where the chief executive offi cer and the chief human resource offi cer get along and work together

absolutely. I think there is a direct effect in terms of that relationship and the health of the organization. Can I prove that? No. But would I put money on it? Yeah.

In each of the successes that I mentioned, the chief human resource offi cer was highly edu-cated and knew a lot about change. The CHRO at Dime had gone through our Advanced OD/HRM Program. That’s how I knew him.

So, there is a contingency in terms of my state-ment and that contingency is that chief human resource offi cer needs to be pretty savvy about change.

References1 For more on this fi nding, see feature article in this issue of the People & Strategy journal, Securing lasting value through organizational health, by Bazigos, De Smet and Schaninger, 36–41.

2 Kotter, J.P & Heskett, J.L. (1992). Corporate Culture and Performance. NY: The Free Press.

3 Barsade, S.G., Ward, S.J., Turner, J.D.F., and Sonnenfeld, J.A. (2000). To your heart’s content: A model of affective diversity in top management teams, Administrative Science Quarterly, Dec. 2000, 45 (4): 802–836.

4 Burke, W.W., & Litwin, G. H. (1992). A causal model of organizational performance and change. Journal of Management, 18(3), 533–545.


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Anna Tavis: How do you defi ne “healthy or-ganizations,” and why does it matter?

Chris Gagnon: Here’s the key thing: organi-zational health doesn’t just mean ensuring that “people are happy.” Nor is it about cor-porate culture for culture’s sake. The underly-ing concept is that performance and organizational health are inextricably linked. There is no lasting, long-term performance without real organizational health. It’s all about driving performance.

So I’ve said what it’s not. I should say what it is! We define organizational health as the ability to sustain performance over the long-term by having employees who continually demonstrate three key competencies. They understand where the organization is going and how it plans to get there – in other words, they “get” the vision and the strategy. They have the tools, capabilities and motiva-tion to put those plans into action, helped by the fact that the organization has the right processes in place. Last but not least: they’re encouraged to innovate and adapt to change in order to keep the organization ahead of the game.

Let me push harder on the point about per-formance, and give you some numbers. Too often, the tendency is to look at fi nancial per-formance only, but that’s only half the equa-tion. You have to manage financial performance and long-term organizational health with equal rigor. Our research under-scores that: the healthiest companies in our database have total returns to shareholders

What if there were a way to measure and track the elements of organizational effectiveness directly related to financial and operational performance that also offers actionable insights into areas of improvement? Turns out, there is. People & Strategy executive editor Anna A. Tavis, Ph.D., interviews Chris Gagnon, M.B.A., solution partner at McKinsey & Co.’s Organizational Health Index, about healthy organizations.

In First Person: Leading Healthy Organizations Anna A. Tavis, Ph.D., in conversation with Chris Gagnon, M.B.A.

findings. So far, OHI has helped literally thousands of companies to perform better, allowing them to see how they stack up against industry averages—and more impor-tantly, how they compare with the healthiest organizations in the world.

Over time we came upon the realization that we could leverage big data, software and expertise, rather than capital, to help our cli-ents make better decisions about that “soft” side of their businesses—and take more deci-sive action on those issues. That led to the formation of our Solutions offerings—which enables us to serve clients in a variety of ways with both McKinsey consulting teams and independent of them.

You can probably tell that measurement of organizational health is a real passion for me. You know, the only way to manage some-thing like this is to measure it. So the Solution tool is not just a great way to do research, get insights, and understand an organization’s health, but also a way to manage and improve health so it helps to deliver sustained perfor-mance and competitive advantage. I’d go so far as to say we’re on a mission to get orga-nizational health measures widely accepted as drivers of long-term performance.

AT: Could you please say more about the Or-ganization Health Index and how you use it?

CG: The OHI has four elements to it. First, we’re able to give a single score for how healthy an organization is. This is a single number that boards, management teams, and fi nancial markets can all look at—a measure that quantifi es the overall performance capa-bility that an organization is building for the long term.

This is a really crucial point. As I said, anyone who’s looking only at the raw fi nancial met-rics is getting only half the equation. Dominic Barton, McKinsey’s worldwide managing

(TRS) that are nearly twice the TRS of com-panies in the middle of the pack.

AT: So, tell us how McKinsey came up with the idea of organizational health. What was the motivation?

CG: Well, over time, our consultants had been getting more and more questions from our clients about how they should tackle the nontechnical, “softer” aspects of their busi-nesses. Increasingly, we were hearing CEOs and other business leaders say things like “We know there’s more to achieving and sustain-ing performance with our people, but we don’t know exactly what it is or how to make it better.”

In answering this quandary, McKinsey was really fortunate to have two people with Ph.Ds. in management and organization as statisticians, each of them deeply trained in quantitative methodology. They set out to devise a tool that would help us talk about these issues in a way that top executives could relate to. They built the tool called the Organizational Health Index (OHI) that my Solutions team now runs. The fi rst version was designed more than a decade ago; as we got more performance data from our clients, we refi ned the tool to get better and better at both describing the situation and predicting performance. We’re getting really good at knowing what organizational health looks like; we’re gathering more and more OHI data to help us deeply understand the linkage between performance and health, and to make it easier for companies to act on those


There are different ways to run companies, not just stylistically, but in terms of the actual mechanics of management practice and running the organization on the day-to-day basis.

director, put it well in 2011 in an essay in Harvard Business Review. The essay was titled, “Capitalism for the Long Term.” He said today’s governance systems are biased toward short-termism; the unintended upshot of striving to meet quarterly targets is that executive teams manage for only a small por-tion of their companies’ value. I’ll quote him here: “If the vast majority of most firms’ value depends on results more than three years from now, but management is preoc-cupied with what’s reportable three months from now, then capitalism has a problem.” In other words, we’ve got to use metrics that reward the long-term view of performance.

The second element breaks that single num-ber down into nine sub-scores called outcomes—measures of how well an organi-zational approach is doing at different aspects of organizational success. It might be the way the company drives accountability through-out the organization; it might be how it inno-

vates. We use a proprietary algorithm to combine those nine outcomes into the one number: the company’s OHI score.

The third element is actually the meat of what we do with our clients. It’s what we call practices. There are currently 37 practices, each developed as a way to fi gure out how management teams spend their time. This is really the key to how the OHI works. It doesn’t ask questions about how people feel, where the answers are often clouded in indi-vidual perception bias. Instead, we ask how people spend their time. That way, we’re talking about the actual work of running

organizations—not about personal work styles or preferences.

The fourth element of OHI is the ability to learn from the best models out there. We’re serious about our focus on performance; we continue to compile statistics, and we have to say they’re getting pretty interesting. The sta-tistics we’ve published broadly so far clearly underscore the connection between organiza-tional health and performance. They tell us that the upper quartile of public companies in our database—the upper quartile measured by their OHI scores—have extraordinary total returns to shareholders (TRS): 26 per-cent a year over nine years. That’s three times the TRS of those in the bottom quartile, and almost twice as much as the TRS of the mid-dle 50 percent. We’re not talking about a few examples; this is representative of a large number of companies. We’re doing this with hundreds of companies a year; OHI is prob-ably the tool that McKinsey uses most widely with clients.

AT: So is everyone at McKinsey using the same tool? And do all clients use it in the same ways?

CG: Yes, this is how McKinsey discusses orga-nizational health with our clients all around the world. We can use OHI to produce some fascinating performance metrics, starting at the micro level. Let’s say a company has got 10 plants. If we get the OHI scores for each of the 10 plants, we can tell the company’s busi-ness leaders how the 10 plants are going to do next year. We rank them, and we are getting very, very close to correct.

That’s not to say that all companies are fol-lowing every facet of OHI. A few of the best-performing companies did track against all 37 organizational health practices, but what was interesting was that none of the healthi-est companies we looked at used all 37 prac-tices at a high level. As a matter of fact, none of them did even 20 with great frequency. So it looks like companies only need to get seven or eight practices ‘right’—just those practices that hang together in a consistent management philosophy.


AT: Have you had subsets of your client com-panies talking to each other about organiza-tional health?

CG: We’ve been pretty good at putting com-panies together one-on-one. We haven’t yet created the community that I think needs to exist; that’s definitely on our agenda for 2015. It could be a really powerful learning mechanism. Imagine having two companies in the same room: one is pursuing employee involvement and continuous improvement strategy, and the other is winning the war for very high-priced specialized talent. Those two companies approach the world in radically different ways. Think what they could learn from each other!

AT: So if companies are leveraging data to im-prove their organizational health, how do their CHROs pull it all together into a coherent nar-rative? Can’t there be a hybrid HR professional who is very conversant with the technology and data and yet eloquent on the storytelling side?

CG: Sure there can. At McKinsey, we think of it in two parts: one is the reliance on fact-based analysis and the other is using that fact-based analysis to tell compelling executive stories. One of the most important things we’ve done in our group is develop ways to “storyline” the information that comes out of OHI or other survey data. So every client we work with knows the answer to three ques-tions: how healthy their organization is; why it’s healthy or unhealthy; and what’s the struc-tured, evidence-based narrative case for doing something to improve organizational health.

If the CHRO can’t make that fact-based nar-rative case and be passionate about it, he becomes the one who, at the end of the meet-ing when all the important stuff has been discussed, says, “Now, let’s talk about our culture or our employee engagement survey” – and you can hear the crickets chirping. We fi nd that the HR chiefs who really “get” orga-nization health are true performance partners within the business, eager to use the best tools to improve their companies’ performance.

AT: How big is your unit? And do you and your team take the medicine that you dispense to clients?

CG: We’re about 60 people. And yes, we absolutely do take our own medicine here.

The fi rst year we measured our unit’s orga-nizational health, we found three things to work on. Two of them improved dramati-cally in the following year; we got better at strategic clarity – our own big vision – and at translating that vision into specifi c objec-tives for our people. We’ve always scored high on bottom–up involvement, where we spend time pointing people in the right direction or helping people form groups to discover innovations around our product and services, and sharing the knowledge and supporting them.

But on one measure—role clarity—we did not improve. The score didn’t go up because I, as the group’s leader, didn’t really believe in it. I’m naturally a very “ad hoc” kind of leader. But this bias toward fl exibility was causing some issues for some of our team, and I hadn’t been sensitive enough to that.

When we hadn’t made progress on role clar-ity during the fi rst year, people came to me and said, “Chris, you don’t get it. Here’s what we need and why, and here’s how your mindset is causing us problems.” So we talked about it until I understood them and they understood me, and we came up with a ver sion of role clarity that worked for us.

And the next year that measure improved dramatically.

I’m not telling that story to say, “Look how well we did,” but to illustrate how the process of a disciplined discussion was able to lead us as a group. It gave us a way to have a struc-tured conversation. That’s the kind of conver-sation we need to allow to happen. It really is the hallmark of a healthy organization.

AT: You mentioned that organizational health metrics allow companies take more decisive action on those issues. Say more about how companies do that.

CG: Yes, the metrics are not just for putting up on a plaque. They are meant to give the execu-tive team a dashboard—a set of instruments that point them to the actions they have to take to make their organizations healthier. But there’s a virtuous cycle at work here. Our OHI studies show that companies that work on this stuff soon see real change in the metrics. In fact, changes to organizational health happen much faster than the three- to fi ve-year time span you hear about a lot. We now have a growing library of cases where companies are seeing real improvements in relatively short

That’s the kind of conversation we need to allow to happen. It really is the hallmark of a healthy organization.


time frames. So business leaders should now expect fast improvements in organizational health. Good, timely metrics allow rapid experimentation; good leaders are never afraid to experiment.

AT: What is your advice to senior-level HR professionals? What is the role of the CHRO in designing for and managing organizational health?

CG: I talk with CHROs about several big pri-orities. First and foremost, you’ve got to be a partner in performance. The business unit lead-ers are accountable for business performance; the CHRO must be too. In fact, she must be seen to be a performance partner. That puts her on the right side of the table; anything she then proposes is going to be better received.

Next, the CHRO has to be very conscious of how the top executive team spends its time.

That time is the most precious resource a com-pany has. The ways it is spent send crystal-clear signals about what’s important and bring attention to critical issues. So it deserves every bit as much focus as you would put into man-aging your manufacturing processes, your ser-vice operating processes, your sales processes.

I also urge HR leaders to systematically mea-sure every relevant factor that moves, wheth-er it’s for OHI or some other tool. Opinions about organizational health are great, but CHROs have to use data and systematic mea-surement and assessment to tackle the key questions if they are to deliver answers with the same level of rigor as the rest of business management.

Last but not least, CHROs must fi nd ways to learn from and with others. In some ways, the management process is more universal than the manufacturing process or service opera-tive process. There are literally tens of thou-

sands of organizations facing the same challenges of how they run the place, and all are trying to bridge those gaps and build those communities.

AT: Thanks for this advice for HR leaders, Chris. So what’s next? How will the business of organizational health evolve?

CG: There are several ways in which I see this evolving. One is that “solutionized” delivery will become a bigger part of organizational health metrics. Another is that these measures will improve naturally as they absorb more usage data and as companies participate more actively in those measures—as they become active in the business conversation about organizational health.

AT: Will there be an underlying technology platform that brings all these diverse activities together?

CG: Yes, that’s the third way I see this all evolving. I see increased integration and I would expect much of it to happen on top of the HRIS. But let’s be clear: I’m not talking about an all-singing, all-dancing HRIS system that perfectly manages organizational health. What I do anticipate is that the pace of inte-gration will pick up, with more organizational health tools being integrated into HRIS.

AT: Chris, thanks very much for your time and your perspectives. Very informative. We look forward to hearing about how organizational health practices are being adopted. You’ve made a very strong business case for why CHROs should care about it

CG: Delighted to talk. I’m passionate about this topic. As I mentioned earlier, we’re on a mission to make these metrics part of every-day business discourse. I really do believe the day is coming when boards of directors and other stakeholders start asking for those kinds of metrics because they’re hearing about organizational health’s impact on long-term performance. I’ll be glad to share the next installment of our OHI story!

ReferencesCapitalism for the long term, March 2011, Harvard Bus ine s s Rev i ew . h t tp s : / /hbr.o rg /2011 /03 /capitalism-for-the-long-term.

But there’s a virtuous cycle at work here. Our OHI studies show that companies that work on this stuff soon see real change in the metrics.


1STIN

Alison Romney Eyring: What should our read-ers know about CBRE as a company?

Laura O’Brien: CBRE is a Fortune 500 and S&P 500 company and the largest commercial real estate and investment services fi rm in the world. Our company has approximately 44,000 employees and serves real estate own-ers, investors, and occupiers through approxi-mately 350 offices worldwide. We offer strategic advice and execution for property sales and leasing; corporate services; property, facilities, and project management; mortgage banking; appraisal and valuation; develop-ment services; investment management; and research and consulting. As a company, our strategy is to produce distinct advantages for our clients, employees, and shareholders by creating real estate solutions that drive value and growth.

ARE: It seems that health and well-being at CBRE has more meaning than in most multi-national corporations. When did this become a part of your company’s culture?

LO: World-renowned doctor and best-selling author Dr. Deepak Chopra has said that “our environment is an extension of our body.” As the global leader in commercial real estate, we have taken that philosophy to heart by creat-ing and implementing workplaces designed to optimize health, wellness, and productivity as part of our innovative workplace strategy ini-tiative called Workplace360. In addition to wellness, each of our 21 Workplace360 offi ces

As companies look to improve their environments and attract the best talent, there’s been a focus on promoting organizational health and wellness. Alison Romney Erying, Ph.D., met with Laura O’Brien , global director of client care and development and head of sales management for the Americas at CBRE, to discuss CBRE’s workplace strategy initiative, Workplace360, and its effect on employee well-being and overall workplace satisfaction.

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IN

Health and Well-Being at CBREAlison Romney Eyring, Ph.D., in conversation with Laura O’Brien

Human Resources is about attracting, developing, and retaining great talent, and our workplace is about providing a productive environment for people to flourish.

and wellness play in a happy and successful work life.

ARE: You led the implementation of a cutting-edge workplace transformation in your Los Angeles headquarters offi ce and many other offi ces around the world over the last couple of years. What were you trying to achieve?

LO: When we began planning the implementa-tion of Workplace360 in our L.A. offi ce—our first in the U.S. and, up until recently, our largest in the world—wellness wasn’t one of our primary focuses. As we delved deeper into some of the core elements of our Workplace360 initiative—like “free address-ing,” where no one has an assigned seat—we started thinking about things like the transfer of germs and how we were going to ensure a healthy environment for our employees. From there, we established a health and wellness

committee and, as we researched and learned more, health and wellness became increasingly important to our employees who would be liv-ing in the space and to our leadership. In a very short amount of time, we became avid believers that promoting the health and well-being of our employees through our offi ces was of primary importance.

Based on Delos research, insight, and improve-ment methodology, we committed to the im-plementation of more than 50 health and wellness features in our downtown Los Ange-les offi ce, including circadian lighting, hydra-

around the world features a balance of private and collaborative workspaces designed to support the way employees work through enhanced flexibility, mobility, technology, and productivity.

ARE: For the last few years you have served as CHRO—in addition to heading Global Facili-ties and Workplace Strategy for CBRE. What influence did your workplace strategy role have on the evolution of your thinking about health and well-being?

LO: I see HR and workplace strategy as being inextricably connected. Human Resources is about attracting, developing, and retaining great talent, and our workplace is about pro-viding a productive environment for people to fl ourish. As a professional services and invest-ment fi rm, our most important asset is our people, so providing a workplace environment that improves the way we work today, while enhancing our overall health and well-being, is a top priority. By incorporating these features into our workplace, we are sending a message to our employees that we value the role health


Eighty-three percent of employees feel more productive in the new space.

tion stations, plant life, treadmill desks, ergonomic sit/stand desks, energy-absorbing fl ooring, advanced air purifi cation, and anti-microbial coatings on all surfaces. In 2013, this offi ce became the world’s fi rst commercial offi ce building to be certifi ed under the WELL Building Standard.

ARE: How have these changed made a differ-ence at CBRE?

LO: After a year of working in our offi ce in downtown L.A., we asked our employees to tell us if they felt our health and wellness initiatives were making a difference. An in-credible 92 percent of employees said the new space has had a positive effect on their health and well-being, while 50 percent of employees reported that they use the height adjustable (sit/stand) desks and 74 percent prefer using the stairs to move through the building as opposed to the elevators. Of all the wellness features, hydration stations, plant life, and the circadian lighting—an ar-tifi cial lighting system that changes through-out the day to match natural human circadian rhythms—ranked as the most well-liked among employees.

ARE: What is the evidence that you achieved your objectives?

LO: We took a bold step in bringing this new way of working to the U.S. with our downtown L.A. offi ce, and one year after moving into our new work environment, more than 90 percent of employees report that, if given the choice, they would not re-turn to their previous, traditional way of working. Eighty-three percent of employees feel more productive in the new space, and 93 percent say that the new space has had a positive impact on their business perfor-mance. These results not only validate our workplace approach, including the role health and wellness play in overall perfor-mance, but they serve as a tremendous re-cruitment and retention tool that will help drive the growth of our firm into the future.

ARE: What were some key insights you gained from this experience about how a workplace impacts health and well-being?

LO: The office is a place where people spend a lot of their time, and investing in employees—especially in their health and well-being—is one of the most important things we can do as a company. The wellness aspect of our Workplace360 initiative adds a critical ele-ment to our work environments by creating places where people feel energized and want to be every day, and where they are able to be focused and productive.

ARE: From an HR standpoint, what is CBRE doing to create a workplace and workforce that is healthy and well?

LO: We now have 21 Workplace360 offi ces, and many more are planned. While each will have its own unique expression of wellness, this is now part of our strategy around the world. Each offi ce has a wellness commit-tee made up of our employees, and they design the local wellness programs in conjunction with leadership.

ARE: What are your words of advice to other CHROs who might be wondering why this matters?

LO: The physical environment is an important enabler of culture; don’t overlook this magic bullet.

ARE: What can HR leaders everywhere do to lead improvements to the health and well-being of their workplace and workforce?

LO: Give people choice in the workplace. Give them the freedom to collaborate, team up, socialize, focus, and meet. And give them a healthy, safe, energetic, and dynamic work-place in which to do all of it.


book reviewsA Must Read Worthwhile Skim It Over Bottom of the Stack

Using a Positive Lens to Explore Social Change and Organizations: Building a Theoretical and Research Foundation

Authors: Jane E. Dutton and Karen Golden-Biddle

Publisher: Routledge, 2012

Reviewer: David Bright, Ph.D., professor of organizational behavior and organization development at Wright State University.

Using a Positive Lens to Explore Social Changes and Organiza-tions: Building a Theoretical and Research Foundation is a contribution from the movement of positive social science. The “positive lens” highlighted in the title refers to a research orien-tation in which scholars “focus on understanding the elements in the change process in and of organizations that build up, increase, enable, and foster benefi cial outcomes associated with social change.” The “social change” aspect of this book refers to the study of changes that come from social movements or from other attempts to create shifts in society.

At fi rst, it may be hard so see the relevance of social change theory to the HR professional. Yet social movements can be a powerful source of positive energy, and social change theory

provides insight into the practices that can be used to engage employees and encourage them to participate in the design of organizational change.

The book has four main sections that explore various areas of social change: change agency, environment and sustainability, health care, and poverty and low-wage work. Each section includes several papers on a focused topic, followed by an ana-lytical chapter that summarizes key themes and patterns. Most of the chapters include interesting, relevant cases that provide an effective illustration of the key ideas.

The most interesting insights in this book all provide perspective on the conditions for creating change:

• The opening chapters highlight examples of both bottom-up (self-organizing) and top-down (directed organizing) approach-es to change. Successful changes comes about when leaders provide general direction while inviting employees to partici-pate, to have voice, and to be engaged.

• A handful of competencies seem to be particularly important to positive social change: overcoming adversity, discerning alternate possibilities, and managing tensions.

• An environment of hope activates both the cognitive and emotional resources that can become a guiding force for change.

• Leaders can encourage social change by amplifying resourc-es (time, funding, team development, and so forth.) and buffering demands (limiting distractions, managing the scope

continued on page 64

The Advantage: Why Organizational Health Trumps Everything Else in Business

Author: Patrick Lencioni

Publisher: Jossey-Bass, 2010

Reviewer: Michael N. Bazigos, Ph.D., global head of product development, data analytics, and research at McKinsey & Company’s Organizational Health Solution

In the fog of war that is contemporary corporate life, soldiers move silently through shadows, glimpsed as fl eeting silhouettes while re-enacting scripts they inherited from corporate predecessors. They may or may not know the terrain, nor how close they are to the last frontier of competitive advantage: organizational health.

A senior leader enjoys a close relationship with Fred, a member of his team, and creates tension in the group by giving Fred a free pass for “destructive behavior.” The leader confesses to a consultant that he is afraid Fred will quit if he holds him accountable, and lose that technical expertise. It is possible that he was re-enacting the “results trump all” script passed down through the ages.

The leader is subsequently confronted by his team in a meeting facili-tated by the same consultant. After the team discussion, the leader and his team begin to hold Fred (and one another) accountable for their mutual commitments. But a short time later, the leader’s worst fears come true when Fred leaves.

But something curious follows, perhaps unexpected by our leader. Fred’s leaving invigorates the team, and their performance improves—a result the leader attributes to the new culture of real, not espoused, accountability the team embraced. The vignette ends here, but we can reasonably assume that more junior managers, perceiving alignment between their senior leaders, embrace the same norm, improving execution and results. continued on page 63

A Must Read Worthwhile Skim It Over Bottom of the Stack

Moral: By holding even favored colleagues to their agreed responsi-bilities, the leader gained credibility, which fostered alignment around a cultural norm of peer accountability. The ensuing clarity became contagious, prompting healthier interactions and better performance.

In his tour de force, The Advantage: Why Organizational Health Trumps Everything Else in Business, Patrick Lencioni makes the case for effec-tive organizational functioning in compelling style. Drawing on critical “moments of truth” from his consulting career, like the story of Fred, Lencioni illustrates the principles that drive organizational health using accessible, plain English anecdotes.

Lencioni does not equivocate, stating, “The single greatest advantage any company can achieve is organizational health. Yet it is ignored by most leaders even though it is simple, free, and available to anybody who wants it.”

To achieve health, there are five success factors he holds as critical. These define the chapter structure: building a cohesive leadership team; creating clarity; over communicating that clarity; then, reinforcing that clarity. The fifth chapter puts forward a framework for meetings to support alignment, including their function, participants, timing, cadence, and rationale.

As with most research and writing around organizational development, it’s easy to dismiss any such list as obvious, and even trite. But under-standing the items is far different than actually performing them. The latter can be challenging because of the personal discomfort they prompt.

For example, on the topic of building a cohesive leadership team, five behaviors are put forward as critical: building trust; mastering conflict; achieving commitment; embracing accountability; and focusing on results.

While the book, by design, favors anecdotes to quantitative evidence, the latter is brought forward in the tea-building chapter to make a strong point. Based on 12,000 responses to his online group effectiveness survey of teams, peer accountability—the focus of this review’s open-ing parable—is the hardest. Lencioni writes, “… a full 65% of teams scored ‘red’ on accountability—or lowest on [the] three-tiered rating scale of green-yellow-red. Other red scores for the remaining four behaviors include trust (40%), conflict (36%), commitment (22%), and results (27%).”

It may well be that the culture of accountability at the top of the house sets the tone for the wider organization. Analysis of McKinsey & Co.’s Organizational Health Index (OHI) conducting more than 1,800 organi-zational surveys with nearly 2 million responses shows that management practices that drive accountability, like role clarity and personal ownership—combine to predict 90% of the health score, which in turn has been linked to long-term total shareholder return (TRS) . Considered together with Lencioni’s finding that 65% of teams have trouble with peer accountability, the business benefit of achieving that alone, as a reliable and repetitive way of working, may draw the senior leader’s interest as a hidden performance differentiator. (It is likely a necessary but insufficient condition for sustained health over

the long term, though, because although perhaps less challenging, the other factors are important, too.)

When leaders struggle with confronting peers and direct reports on behavioral issues, the book notes, they rationalize it with their desire to be kind. “But an honest reassessment of motivation will allow them to admit that they are the ones who don’t want to feel bad and that failing to hold someone accountable is ultimately an act of selfish-ness.”

Resonant quotes like this suffuse the book. For example, on the topic of performance management systems, a well-documented source of pain in many organizations (and what senior leaders often admit are completely ineffective), “That’s why a one-page, customized perfor-mance review form that managers embrace and take seriously is always better than a seven-page, sophisticated one designed by an organizational psychologist from the National Institute for Human Transformation and Bureaucracy (there is no such thing).”

Quotes like this, and narrative descriptions that take the reader into the executive suite, make this a page-turner in a genre not renowned for easy reading. Every senior leader will benefit from what Lencioni calls “the Playbook” which is essentially a short document (a few pages) that codifies the otherwise “invisible” shared assumptions of the leadership team around the matter of why they exist at all, the methods by which they believe they will succeed, and the three priori-ties they commit to apply as criteria in any major decision. It is the hard discussions that create the document—not the document itself— that move teams to health. A checklist at the book’s end makes important considerations easy to review, depending on where the team is on its health journey.

Readers should be cautioned that leading exercises like the ones described in The Advantage is not for everyone. Serious group dynam-ics training and senior-level facilitation skills and experience are required to move smart, driven executives out of their comfort zones and achieve a constructive outcome. For example, a truth-telling exer-cise described in a chapter on trust building could go seriously awry in inexperienced hands. For another, the practitioner who is uncomfort-able with pregnant pauses at critical points in a team conflict may squander real opportunities to get the team to a different (and better) place.

Finally, the book is packed with practical examples of principles applied with real teams. As such, it is nine parts recipe, but it is also one part credo. Practicality does not obviate a crystal-clear viewpoint about the activities’ rationale: “As more and more leaders come to the realization that the last frontier of competitive advantage will be the transforma-tion of unhealthy organizations into healthy ones, there will be a shift in the mindset of executives away from more technical pursuits that can be delegated to others and toward the disciplines outlined in this book. Whether that takes place over the next five, 10, or 20 years, I don’t know. But it’s coming.

For the early adopters of organizational health, the advantages that they will reap will be amplified as they achieve even greater differen-tiation from their lagging competitors.”

THE ADVANTAGE continued from page 62



of responsibility, etc.), thus keeping the focus on forces for

change, rather than on forces of stability.

• Relationships are an important catalyst for social change no

matter if the change occurs in the African countryside or

within a community health initiative.

• People are more likely to initiate change when they under-

stand the interaction between the individual and an

organization and are able to think refl ectively about their

contributions to an organization.

Together with the introduction and conclusion, the four sum-mary chapters provide a good synopsis of the key insights. The reader who wants a deeper dive can explore the individual chap-ters. HR practitioners may be most interested in the sections on change agents and on health care, given that these seem most relevant to an organizational context.

In sum, this is a theoretically oriented book that may be of interest to HR professionals who are seeking ideas about how to engage and empower employees. Most important, this book offers many insights into how to create the conditions for social change, wheth-er inside or outside the boundaries of an organization.

USING A POSITIVE LENS continued from page 63

Overworked and Overwhelmed: The Mindfulness Alternative

Author: Scott Eblin

Publisher: Wiley, 2013

Reviewer: Susan H. Gebelein

Never has an audience for a book been so well defi ned. Scott Eblin, executive coach, speaker, and author, has written a book that express how so many people feel: Overworked and Overwhelmed. Scott pro-vides a clear recipe for people to redirect the course and pace of their lives so that they are more present, more effective, and more intentional in their personal, professional, and community lives. And as a byproduct, they may actually live longer—and certainly with more purpose and probably joy.

Clearly, the book is not for people who believe they thrive on stress and multi-tasking, who thoroughly enjoy being over scheduled and busy, or who take pride in being “on” 24/7, 365. Eblin provides research on how busy and stressed people are these days and the merits of mindfulness. There is less focus on research to convince the reader that this overstressed life is not a good idea or that due to the continually activated stress response in the brain, people actually make poorer and poorer decisions. So, for those looking for greater understanding of what neuroscience knows about leadership and organizational performance, this is not that book.

What Eblin does do well is to introduce the concept of mindfulness as a key practice to break out of the cycle of feeling overworked and overwhelmed. He defi nes mindfulness as “awareness plus inten-tion.” He illustrates that mindfulness is not passive; rather, mindfulness provides the ability to be more conscious, more present, and more intentional. He also defi nes performance as “potential minus interferences.” Eblin views people who are not living intention-ally or with mindfulness as limiting their potential by the “interference” in their lives.

Scott then provides information about Life GPS, a personal planning model that he and his wife developed to help focus on what is impor-tant. The book shares the steps to take to refocus one’s life and develop routines that enable people to “show up at their best.” It

begins with fi guring out what you are like “at your best person,” and then explores what prevents us from showing up at our best.

Eblin provides routines in the physical, mental, relational, and spiri-tual domains to help a person live their life “at their best person.” He uses clever images like personal operating rhythms and “killer apps” to categorize his recommendations, and then provides stories and examples to illustrate them. He even includes tips to keep the promise to one’s self to pay attention to and follow through on these important routines.

As any book on mindfulness, breathing takes center stage as a way to reduce clutter and stress. The value of breathing has a long and rich history of research behind it. It is to Eblin’s credit that he presents deep breathing—or mindfulness breathing—as a key, useful routine, but does not succumb to the excess of other popular writers and the media that claim most of the world problems would be solved if everyone practiced mindfulness. Eblin is also wise enough to know that simply telling a person to breathe deeply does not make it hap-pen. He sheares a number of resources to help the reader learn this practice.

Sories about people who have been helped by this approach or who have something to share about living intentionally are a strength of the book. A favorite lesson learned was told by U.S. Coast Guard Admiral Thad Allen, an excellent example of someone who deliber-ately approaches situations intentionally, whether it was dealing with Katrina or other diffi cult situations he has been called in “to fi x.”

Eblins’s anecdotes come primarily from business situations, mainly CEOs and HR executives, but he also shares some oldies. And quite frankly, if you do not know the Chinese farmer story that illustrates you never know how things will turn out in the long run, I’d recommend reading the book for that story alone. It provides perspective at times of challenge and celebration.

Overworked and Overwhelmed is an easy read, good for an airplane or the beach. You will get more from it if you take the time to use the resources built into the structure. In addition to the GPS tools and the tips and routines, the book is structured with learning points and questions for refl ection for the reader to use.

So if you want to feel less overworked and overwhelmed, or if you’re looking to recommend a resource for others who want to refocus their lives, this book is it. It’s not rocket science, but the book provides practical methods to become more mindful and focused about one’s life and, in doing so, feel less out of control of it.

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Volume 38 Issue 1 Organizational Health and Wellness