Corporate Denial: How It’s Killing Morale

by Jennifer Cross
Princeton Leadership Services

It’s time to stop ignoring the hard things and face our challenges to position our organizations for future success.

According to a May 2015 Gallup Poll, the percentage of U.S. workers engaged in their jobs was a mere 31.7 percent. One major negative influencer of employee engagement and organizational morale is corporate denial. Corporate denial is the classic “elephant in the room” of your organization: everyone in the company knows it exists, yet no one in a position of leadership is willing to address it. Here are a few examples and their consequences…

Case Studies in Denial
Company X is thriving, and business has never been better in terms of volume—but the volume far surpasses the capacity of the organization. Although leadership knows this to be the case, they keep accepting more and more work, promising outcomes that are impossible to deliver. The organization is left with an overworked and exhausted workforce, as well as dozens of unhappy customers as a result of missed deadlines and errors.

Company Y is having tougher times and has watched demand for its services drop sharply, leaving system-wide budgetary issues. A long-term and valued mid-level manager brings forward a way for the organization to save more than $60,000 per quarter, but the leadership of the organization won’t even consider the idea because “we’ve never done it that way” and it might upset some individuals in the organization. This employee leaves the organization for another position where they feel more valued, taking their experience and desire to make a difference to a direct competitor.

Finally, Company Z has volatile leadership and a culture of micromanagement from the highest officers in the organization. Employees walk on eggshells, operating purely in reactionary ways, and have no clarity of mission, planning or execution. The governing board that oversees this organization knows this to be the case, but refuses to make a change and decides to “ride it out” to avoid conflict and confrontation with the organization’s CEO. Good ideas from front-line employees never come to light because people are fearful and adopt a “don’t make waves” mentality to keep out of the line of fire and maintain their jobs.

Adaptive Leadership
What do these examples have in common? Employees throughout the organization (and sometimes beyond) know these dynamics exist, yet no one is willing to consider there are alternatives to maintaining these negative situations. Employees are fearful of calling out bad behavior because the organizational system is designed to protect itself, not its best employees.

In their book The Practice of Adaptive Leadership, authors Heifetz, Grashow and Linsky delineate the qualities of an adaptive organization. These include:

  1. The elephants in the room are named;
  2. Everyone in the organization shares responsibility for its future;
  3. The independent judgment of each employee has value;
  4. The company makes building leadership capacity a priority; and
  5. Reflection and continuous learning are institutionalized throughout the organization at all levels.

By embedding these five attributes into the core of your organization, you create an organizational culture that embodies open and honest communication throughout all levels of the company. Every idea has value, and people don’t make promises they can’t keep. The organization embraces an innovative mindset because there is no fear within the company. Problems and mistakes are met head-on and dealt with systematically, without the blame or stigma of shame for an individual making an error. Challenges are tackled with a team mentality where employees feel they are all in it together, rather than it being one department’s issue or failure. Employees are in the jobs that fit their skillsets, and they receive training, coaching and ongoing support to be increasingly successful.

Making the Change
Let’s face it, the problems you have left are big problems; otherwise you would have solved them already. And ignoring them isn’t going to make them go away; instead, like compound interest over time, they grow bigger. As they grow, more and more of your high performers will head for the door. A recent Gallup study supports this, indicating that one in two working adults surveyed has left their job to get away from their manager (to improve their overall life) at some point in their career.

As the saying goes, denial ain’t just a river in Egypt. Unfortunately, corporate denial is alive and well right here in our community. So it’s time to ask yourself the following:

  1. Where is your company “in denial”? What honest assessments need to be made and steps taken to transform the culture of your organization?
  2. What mistakes are you personally making that you need to accept responsibility for and take corrective action to eliminate?
  3. Who are the individuals in your organization that are barriers to positive change?
  4. What individuals exhibit unproductive behaviors that get in the way of company morale and success? Are they doing your company more harm than good?
  5. Who are the change agents in your organization that you can bring together to have these difficult conversations, strategically plan and collaborate to transform your organization’s culture?

It’s time to stop ignoring things that may be hard—yet are fixable—in our companies, and face our challenges to position ourselves for greater success in the future. Your company can be a high-performing organization with engaged employees, positive staff morale and a stellar corporate culture. It’s time to look in the mirror, be honest about what you see and address your company’s corporate denial. iBi

Jennifer Cross is the owner of Princeton Leadership Services, a consulting firm that specializes in custom-designed leadership development programs, organizational consulting and executive coaching.

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