Other parts of this series:
If you are reading this, chances are you feel burned out, at least some of the time. That’s how two thirds of US employees said they felt, according to J Pfeffer on the BBC in May 2018.
Burnout is caused by anxiety and fear ‒ two emotions that are particularly prevalent in the financial services industry in 2019. This is not guesswork; this is based on Accenture’s “Transformation GPS,” a research tool with a database of input from more than a million employees of some 220 organizations undergoing business transformations.
The financial services industry is going through a profound business transformation at the moment. Automation is changing how work is done. The overwhelming majority of employees (six or seven out of ten people) believe that intelligent technologies will create opportunities for their work. And they feel they need new skills to work with intelligent technologies. You can read the full report by clicking on this link, “Future Workforce: Reworking the Revolution”, Accenture, 2018.
Objectively speaking, the future is rosy for the industry. For companies that commit to investing in automation, there will be a 32% increase in revenue, and a nine percent increase in employment, according to Accenture’s research with the World Economic Forum.
So where is the fear coming from?
Automation may eventually drive an increase in employment as revenues rise, but the financial services industry is not there yet.
The truth is that automation has led to some rationalization and job losses. This naturally causes insecurity, anxiety, and fear. Many people are worried they won’t be able to provide for themselves and their families. They also worry they will be unemployable as their skills become irrelevant.
This taps into their most primal drives and fears.
And fear and anxiety cost companies money.
Those two-thirds of people who report being burned out, most or all of the time. They are more likely to call in sick; they are more likely to leave their current employer. High levels of stress in an organization dents its ability to attract top talent.
That’s not all. Fear reduces collaboration and creativity ‒ the very skills a 21st century bank or insurer needs to become a market leader. Subject matter experts start hoarding information in order to make themselves indispensable. The culture becomes risk averse. The stakes are high and failure is no longer tolerated. Fear of failure means less experimentation, more second-guessing and conventionality.
David Rock’s influential paper, SCARF, a Brain-Based Model for Collaborating With and Influencing Others, shows that we are constantly scanning the environment for stimuli that may threaten or reward us.
His research suggests the most powerful drivers for collaboration and influencing others are Status, Certainty, Autonomy, Relatedness (or sense of safety with others) and Fairness – SCARF in the title of his paper.
It’s easy to see how fear undermines Rock’s SCARF model. Job insecurity is the polar opposite of Certainty, and the prospect of unemployment threatens people’s sense of Status. Fear undermines Autonomy because people are double-checking everything they do ‒ or doing only what they are instructed to do, in case they fail. In high fear environments, the team feels unsafe and unstable, damaging the Relatedness driver. And with all this powerlessness, it’s natural that employees feel unfairly treated.
One last statistic. Even if only one third of your team feels fear, that’s an indication that fear has taken root in the organization.
Is fear present in your team or organization? If your team members are asking themselves one or more of these five “fear questions”, that’s a warning sign:
- What will my colleagues think?
- Will this even work?
- Will this be good for my job prospects, or will it get me fired?
- Is it worth saying anything controversial if my boss is in the room?
- Before I speak, do I have all the data and be 100% sure of my facts?
These questions indicate that people are frightened, and scared people spend a lot more time plotting their survival than working productively.
According to S. Keegan, Kogan and Page (2015), depending on its severity, fear can cost up to 50% in a company’s productivity. That means if fear is present in your company, it could be costing up to half of the dollar amount that your payroll costs.
By removing fear, companies could be increasing their bottom line by a number equal to half of what salaries cost per year. That’s a significant number.
The best news of all? Fear can be eradicated by building a high-trust organization. As Mastercard CEO and president, Ajay Banga put it, “If you want things to happen, everybody has to be open and trusting.”
Doug Conant, author and Chairman of the Kellogg Executive Leadership Institute, argues that the way to build a high-trust culture is to make every workplace interaction a building block of trust in the organization, both in leaders and in each other. Every person should know what they are doing, and do what they say they will do. This approach goes beyond the immediate team.
Interestingly, when teams compete with an external competitor, it builds prosocial behavior in the group. Competing internally, on the other hand, erodes trust.
By paying attention to the five fear questions, and by being a trusting, trustworthy leader, you can eradicate fear, build psychological safety, and increase productivity and bottom-line results.
If fear is present in your organisation, it is likely that two thirds of your staff feel burned out, at least some of the time. We’ve also seen how the erosion of collaboration and creativity can cost a significant amount in lost productivity, absenteeism and talent retention.
Coming up in this series, we will discuss how individual leaders can build a high-trust organization.
Read the full report on this topic, Fearless: How safety and trust can help.
In the meantime, if you would like to discuss the impact of fear in your organization and how to remedy it, please contact me.