Seven Best Practices of Successful Organizations 8

Sharing Info, Workloads, Positive Feeback Boosts Productivity

By Daniel Butcher

Leaders who can install processes for effective, timely information-sharing, fair workload distribution, and civil communication—including positive feedback—foster the best collaboration and productivity among team members.

Academy of Management Scholar Peter Bamberger of Tel Aviv University said that lackluster productivity is often a result of poor information-sharing and workload-sharing behaviors.

“Team processes are hard; people can’t always pick up the signals that they need to,” Bamberger said. “For example, if they have a piece of information that someone else needs, when should they pass it on to this other person? A nurse has a test result; when should she pass it on to the to the team leader or attending physician?

“If she passes it on too early, she’s going to disrupt what they’re doing, which clearly affects their performance, but if she passes it on too late, it could be deadly, so timing and synchrony of such tasks are crucial,” he said.

Incivility and rudeness also undermine productivity, while civility and kindness tend to boost it.

“In research on medical teams, we demonstrated that when people experience gratitude at work it can often, but not always, have beneficial implications,” Bamberger said. “A lot depends on the source of the gratitude and the nature of the task at hand.

“In one experiment, we had the three teams: a control condition, one that viewed a video before they started the day from a senior neonatologist talking about how grateful he is to everybody in the field for doing the wonderful work they do to save these babies, which had nothing in terms of a productivity boost, but then we had a third group where we had a mother of a preemie talk about how grateful she was to the medical team that saved her child, and that had massive positive effects,” he said.

“We demonstrate what that does to the team interaction through the implications based on a theory in cognitive science called [Fredrickson’s]broaden-and-build, which explains how positive emotions have beneficial effects on people’s ability to be flexible in their thinking, to absorb more information, and things like that.”

Bamberger and colleagues also demonstrate that the effects were much stronger when a mother expressed gratitude than when a senior colleague did.

Sharing positive customer feedback

Business leaders and managers can leverage these insights to improve their effectiveness.

“They can demonstrate gratitude themselves; it does make intuitive sense that if managers and leaders behave with civility and politeness, then that may set an example for the rank-and-file employees to do the same, but they can encourage customers and clients or patients to say ‘thank you’ directly,” Bamberger said. “If you like the way a flight attendant treated you on a flight, you’re supposed to write the company, but what if you were actually put in direct contact with the flight attendant and were able to express the gratitude directly?

“Our evidence suggests that that’s going to have a much stronger effect than a manager saying, ‘You got three positive letters this week,’” he said. “Setting up systems for customers to directly express positive feedback has the potential to significantly boost employee morale and performance.”

Rudeness Doesn’t Motivate Workers—Quite the Opposite

By Daniel Butcher

Some business leaders and managers resort to barbs or even shouting to motivate staff members, but research shows that a coercive leadership style is counterproductive. In fact, civility leads to improved team cohesion and performance, while rudeness hurts workers’ performance.

Academy of Management Scholar Peter Bamberger of Tel Aviv University said that several research papers on the subject explore the implications that emotion-laden events in organizations have on interpersonal relations and team dynamics. In a nutshell, rudeness creates a huge distraction that undermines productivity.

“For example, why can’t you text and drive at the same time? When you’re driving, the reason you don’t text is because—aside from it being against the law—you’re distracted,” Bamberger said. “It’s a complex process to text—it takes your attention, so you have limited cognitive resources, and driving is also complex.

“Whatever goes to the texting is not available for driving, and the result could be death,” he said.

What’s the connection between texting while driving and leadership style, as well as interactions between coworkers? Rudeness and even mild incivility are actually highly emotional events that occur frequently in the workplace.

“Many, many employees experience rudeness at work, and it’s rather ambiguous,” Bamberger said. “It’s not like being bullied or attacked physically, but in response to rudeness, you’ve got to try to figure out what is threatening to some degree, but you don’t know how threatening it is.

“And precisely because of that, and largely unconsciously, your brain is engaging and trying to determine the degree of threat,” he said. “That’s not a mindset that’s conducive to analysis, attention to detail, or any type of thought-demanding work.”

If You Do Employee Surveys, Listen to Respondents

By Daniel Butcher

Conducting regular employee surveys is a best practice that leads to better engagement, morale, retention, and productivity. But it isn’t enough to simply collect responses, according to Academy of Management Scholar Quinetta Roberson of Michigan State University. It’s important for leaders to actually listen to respondents’ thoughts and feelings and take action to correct problems.

Roberson said that she was working with a large organization as a diversity consultant to develop a strategic plan and objectives. A key step was to collect feedback from its employees, some of whom were ringing alarm bells.

“In their employee survey, they had people who were talking about interpersonal incidents with their coworkers, and they felt bullied and harassed,” Roberson said. “Particularly members of certain groups didn’t feel a sense of belonging and would project that they only had a year left in the organization.

“And so I said, ‘That is really bad; we’ve got to address this … let’s talk about how to address this problem that people say they felt bullied and harassed,’” she said. “I didn’t say this as my own personal opinion; I was literally looking at the responses to their employee survey.

“And they said, ‘We don’t want to say that because it might make other people feel like they are harassed or bullied, and so their whole communication approach was to say, ‘We’ve got some good stuff going on, but we don’t want to talk about the bad stuff.”

While focusing on the positive is an understandable impulse, by not prioritizing the negatives, leaders and managers miss opportunities to make improvements that boost employee engagement, morale, retention, and productivity.

“It isn’t easy work to do, but if you put in the time and the investment, it also isn’t rocket science, so people have to be willing to do the work and get into the stickiness of it,” Roberson said.

“That’s the kind of conversations that I have, because if they’re not willing to do that hard work of thinking about ‘What do we do to fix our problems? What should our goals be? How do we want to be better? How could we be better? And how could we measure that?’ then I’m not the person to work with them, because that’s where I do my work at that strategic level,” she said.

“And that’s just a personal thing from my research and my background where I say, ‘If we don’t have those conversations about formulating strategy, developing dashboards, and creating processes to drive change, then we’re not going to get anywhere; we’re just putting a band-aid on stuff.’”

The Evolution of Corporate Social Responsibility

By Daniel Butcher

Academy of Management Scholar Herman Aguinis of the George Washington University School of Business, one of the most influential management professors and researchers, said corporate social responsibility (CSR) is about three Ps—profit, the planet, and people—the “triple bottom line.” The following is an overview of how CSR has evolved, reflecting changing societal expectations and business practices:

1. Robber barons whitewash their image with philanthropy:

In the 1800s and early 1900s, ultra-wealthy industrialists such as Andrew Carnegie and John D. Rockefeller engaged in charitable activities. The idea of businesses having responsibilities beyond profit maximization was out of favor among the politicians and business leaders of the day, but began to spread among academics and social critics.

2. Businesspeople have social responsibilities:

In 1953, economist Howard R. Bowen wrote Social Responsibilities of the Businessman, recommending that companies should focus on business ethics, contribute positively to their community, and do good things for society, not just make money. Urging business leaders to consider stakeholders other than shareholders and look at outcomes beyond profits was out of step with the post-World War II era, but that concept gained influence in the following decades.

3. Strategic CSR and stakeholder theory:

In the wake of the publication ofR. Edward Freeman’s 1984 book,Strategic Management: A Stakeholder Approach, thathighlights the interconnected relationships among a business and its customers, suppliers, employees, investors, communities, and other stakeholders, and the U.N.’s 1987 report,Our Common Future, CSR started to become integrated into more companies’ strategic-planning processes in the 1990s. As the turn of the millennium approached, more businesses recognized that socially responsible practices could enhance reputation and boost profitability.

4. Globalization and standards:

As globalization accelerated in the 2000s and 2010s, businesses faced increasing pressure to adopt CSR practices to improve their environmental effects, pay and treatment of workers, and ethical governance. Frameworks such as the U.N. Global Compact (introduced in 2000) and the International Organization for Standardization’s ISO 26000 standard (released in 2010) provided guidelines for sustainable and socially responsible policies. In addition, corporate transparency and reporting gained traction as more companies began publishing annual sustainability and CSR reports.

5. Integration of CSR and ESG:

CSR has increasingly become intertwined with sustainable business management, emphasizing the importance of environmental, social, and governance (ESG) criteria. More investors, consumers, and regulators are demanding greater accountability in charting progress toward achieving CSR objectives and quantifying the effects of organizations’ operations on climate change, social justice, and sustainable development.

Tips for Managers to Avoid Team Burnout

By Daniel Butcher

Managers should be on the lookout for signs of burnout in their team members, and a sudden decline in work performance, missed deadlines, or increased errors could be an indication that an employee needs help. Burnout leads to reduced productivity and increased turnover, which is expensive for organizations and causes headaches for managers.

Academy of Management Scholar Sean Martin of the University of Virginia said there’s evidence that many people’s views of the workplace are pretty bleak right now.

“I saw some statistics indicating a lot of folks are feeling a high level of burnout—two-thirds of people would rather get a new boss than a pay raise; they’re just tired of dealing with their boss,” Martin said. “I recently saw another poll that said more than half of people would trust a stranger more than their boss.”

Worker stress has remained at record high levels since the pandemic, with 52% of employees in the U.S. and Canada reporting that they experienced a significant amount of stress on the previous day, according to Gallup. Managers who want to help avoid or mitigate burnout on their team need to realize that people are dealing with stressors both in and out of work and, in response, demonstrate flexibility and empathy.

“There’s a lot of things that are going on in someone’s life like managing family dynamics, extracurriculars, maybe they have care duties for young kids or older parents, so burnout is likely to be present in some form on your team,” Martin said. “If that’s the case, recognize that it’s not always just because of what’s going on at work, although it certainly could be.

“We could either be the kinds of leaders who say, ‘I don’t care—this is work—check all of that stuff at the door and do your job, ’or we could say, ‘I want to deal with a whole person and be the kind of leader that, when people are finished working with me, they view their time with me as time well spent and believe that I had a positive impact on their life and their career,’” he said.

“If you want to be that, then you have to recognize that burnout is an ever-present threat, and when you see people starting to experience it and start seeing the telltale signs of stress, such as retreating into oneself and performance issues in terms of objective measurables, be willing to ask, ‘What can I do? How can I help? ’to start mitigating the burnout that people can feel.”

Performance Management Needs to Be Well-Defined

By Daniel Butcher

As crucial as performance management is to make sure that organizations’ decisions about compensation, promotions, hires, and cuts are aligned with organizational goals, it can be difficult to define. Leaders first must define performance before they can measure it and evaluate their organization’s performance-management processes and procedures.

That’s according to Academy of Management Scholar Herman Aguinis of the George Washington University School of Business and author of Performance Management for Dummies, who said executives at various organizations have asked him about performance issues, complaining that their employees weren’t performing at the level they should have been. In response, when he asked them how they define performance, they typically fell silent.

“Sometimes leaders don’t do a good job of measuring performance because they don’t define performance well, so the first advice I would offer is to be able to make sure that you define performance in alignment with the strategic goals of the organization, the performance goals for individuals, units, teams, and departments all have to be aligned with the strategic goals of the organization,” Aguinis said.

Aguinis argued that performance evaluations shouldn’t be a once-a-year event. Organizations need to train supervisors on how to provide good feedback, measure performance in an unbiased way, have honest professional-developmental talks with employees regularly, and use performance management as a tool for spotting star performers, skills development, and performance improvement.

“If you’re a manager, your top responsibility is to manage the performance of the people in your unit, because if they do well, then the company does well, and you look good, so performance management should not be pushed by HR only; rather, it should be something that every manager and supervisor is doing,” Aguinis said. “Performance evaluations shouldn’t be just as a tool for punishing and rewarding past behavior, but also as a tool for motivating future outstanding performance.”

Many Execs Talk a Good Social Responsibility Game but Fail to Walk the Walk

By Daniel Butcher

Whether it was the board, the CEO, or others in the C-suite who decided to put a corporate social responsibility (CSR) plan in place, it’s instructive to examine their motivations. Do their ideologies and values cause them to legitimately prioritize business ethics, sustainability, and CSR? Do they want the company to look good in the eyes of consumers and convince shareholders they’re doing the right thing? Was it a self-serving or cost-saving decision to implement a CSR program? The answers are keys to understanding whether organizations’ CSR initiatives will be perceived as genuine or contrived.

That’s according to Academy of Management Scholar Herman Aguinis of the George Washington University School of Business, who has conducted research for more than 20 years looking at how individuals decide to be involved in organizations’ CSR mission and who actually participates in CSR initiatives, from the C-suite to rank-and-file employees.

“In some cases, there are external stakeholders who see the organization’s CSR initiatives as genuine, while others complain that it’s just ‘CSR-washing,’ an attempt at PR on the part of a company to burnish its reputation,” Aguinis said. “We recently wrote a paper on how to avoid being labeled as a CSR-washer, which is important because it can take a lot of money and time and effort to overcome an incorrect perception, so we describe things that companies can do to minimize that risk and avoid being unfairly labeled as a CSR-washer.

“One is to involve employees: You should not have a top-down process, but rather a bottom-up process to encourage employees to participate actively, not just enacting the CSR process and intervention, but also in strategizing and creating it, because then they will be the best supporters of the CSR initiatives,” he said.

“They will talk to their families and friends about how good the company is, and that will help attract employees to the company, and its CSR efforts will be seen as more genuine and not just a PR [public-relations] plot.”

Translating CSR strategics plans and goals into action

As crucial as it is for leaders to make strategic plans and set objectives informed by CSR, it’s challenging to translate policies or missions into practice.

“Usually these nice, big strategic goals don’t cascade down, because, in many cases, frankly, it is a statement on their website or some memo or email about a strategic plan that employees don’t read, aren’t aware of, or don’t really care about,” Aguinis said. “In fact, if you ask employees about their companies’ strategic goals, not just about CSR, but in general, they typically don’t know them.”

One way to raise awareness about CSR objectives throughout an organization is through performance management. Leaders need to ask themselves, what are the specific goals regarding CSR for each of the organization’s units? And what are the specific CSR goals for individuals in terms of behaviors and results? Then leaders can start measuring key performance indicators (KPIs)and rewarding employees who perform well on those specific criteria.

“A lot of companies need to do two critical things to improve: number one, involving employees bottom-up in the design of CSR initiatives, and number two, embedding CSR goals within the performance-management system,” Aguinis said. “If you do just those two things alone, you will go a long way in ensuring that CSR is taken seriously and embedded, not just peripheral.”

How Sustainability and Corporate Social Responsibility Became Intertwined

By Daniel Butcher

As scientists’ warnings about climate change have become increasingly urgent, environmental issues and sustainable business practices have become more central to corporate social responsibility (CSR). Now, there is much more pressure on companies to track environmental, social, and governance (ESG) metrics, including their carbon footprint, and consider other environmental factors affecting the climate and ecosystems as part of their CSR commitment.

That’s according to Academy of Management Scholar Herman Aguinis of the George Washington University School of Business, who noted that 99% of companies in the S&P 500 report ESG information to some degree, most annually, including:

• 452 that align with the Sustainability Accounting Standards Board (SASB);
• 395 with the Taskforce for Climate-related Financial Disclosures (TCFD); and
• 346 with the Global Reporting Initiative (GRI), with some following more than one set of standards.

“That dimension has become so, so critical that CSR-ESG and sustainability are key aspects of it,” Aguinis said. “In the 1980s, there was a big emphasis on making the business case for CSR, and now, things have changed a little bit, because many companies are saying, ‘This is the right thing to do—if we make money, great, but if we don’t, that’s not that critical—we need to do the right thing.’

“But CSR and sustainability work best when you do good and do well simultaneously,” he said. “For example, by embracing sustainable practices, you can actually save money and make money, and at the same time, you can look good in the eyes of the community, consumers, and very importantly, your own employees, who are your best ambassadors.

“In fact, if you do CSR and sustainability right, you can use that as a recruitment and retention tool.”

Leaders who want to embrace CSR and sustainability as an honest, genuine, strategic core aspect of the business need to embed them throughout the organization, Aguinis stressed.

“If you do not measure these things at all, and if you don’t reward them, then all employees are not likely to take them seriously,” Aguinis said. “They can’t be evaluated as something you do on this side, as a nice-to-have, so it is critical to embed CSR and ESG within the strategic goals and the organization’s operations.”

CSR, ESG, and sustainability becoming intertwined strategically also relates to reimagining the purpose of the corporation. For example, in 2019, Business Roundtable issued a Statement on the Purpose of a Corporation signed by 181 CEOs who committed to leading their companies to benefit all stakeholders, including customers, employees, suppliers, communities, and shareholders.

“The goal of the business in a publicly traded company is to make money and create value for shareholders, but even if you’re not publicly traded, you have a responsibility to serve your customers,” Aguinis said.

“We have expanded the concept from shareholders to stakeholders more generally—not only the customers you serve but also the communities within which you’re embedded. So, to what extent are you adding value—both financial and otherwise—to all of these stakeholders?”

How CSR Became Table Stakes for Good Leadership

By Daniel Butcher

Corporate social responsibility (CSR) has evolved significantly since 1953 when economist Howard Bowen published Social Responsibilities of the Businessman, in which he wrote that companies should focus on business ethics, contribute positively to their community, and do good things for society, not just make money. Urging business leaders to consider stakeholders other than shareholders and look at outcomes beyond profits was out of step with the post-World War II era. However, fast-forward 70 years, and there’s been an explosion of interest in—and research on—CSR as it has influenced many organizations’ mission, strategic planning, and investments.

That’s according to Academy of Management Scholar Herman Aguinis of the George Washington University School of Business, who said that CSR is affected by society’s expectations. Aguinis stressed the need to define it so that the effectiveness of organizations’ CSR initiatives can be measured.

“In the ’70s and ’80s, there was a trend toward first asking, ‘What is CSR, and how do we define it specifically?’” Aguinis said.

Overall, there’s consensus that CSR is about the three Ps—profit, the planet, and people—and that businesses should take care of those different dimensions affecting all stakeholders, not just profitability.

“The concept of CSR has evolved over time as society has evolved—the processes, the measures of success,” he said. “The concept of CSR has become clearer, but also more complex.”

Shifting from Either/Or to Both/And Thinking Benefits Leaders

By Daniel Butcher

“The test of a first-rate intelligence is the ability to hold two opposed ideas in mind at the same time and still retain the ability to function,” American writer F. Scott Fitzgerald wrote. That quote crystallizes related wisdom from Eastern schools of thought such as Taoism and Western philosophers, including Zeno of Elea and Søren Kierkegaard, who explored the implications of shifting from binary black-or-white either/or categorization and decision-making to both/and thinking, also known as a paradox mindset.

Academy of Management Scholar Wendy Smith of the University of Delaware said that understanding the concept of paradox and applying it to creative thinking and decision making are key competencies for effective leadership.

“We face tensions every day in society and our personal and professional lives, making decisions, serving in a leadership role, and spurring innovation,” Smith notes. “Paradox theory invites us to reframe the tensions from problems to opportunities.

“Philosophers have been highlighting the paradoxical nature of our world for over 2,500 years,” she said. “Yet we are only now returning to these ideas to help inform our key tensions in life.”

For years, leaders and academics have sought clear, logical, either/or choices. This analytical approach has advanced scientific discoveries but limited our understanding of complexity.

“Over the last 200 years or so, as our world and challenges become more complex, science is turning to understand paradox,” Smith said. “For example, quantum physics is all about paradox, and it’s hard to get your head around, but essentially, a particle is both there and not there at the same time, and photons are both a wave and a particle at the same time.

“Psychoanalysts argue that the human psyche depends on holding opposing pressures, both being expansive and restrictive, focusing on both the self and the other, engaging the id and the ego,” she said. “Scholars studying leadership and organizations, and all the research that we publish in the Academy of Management journals—we are late to the paradox party.”

Smith believes that it’s now time for us to embrace the paradoxical nature of organizations and leadership. She noted that the Association to Advance Collegiate Schools of Business (AACSB) recently released a new set of competencies that professors need to teach their students, who include future business leaders. AACSB states: Leaders who exhibit a paradox mindset accept that there are multiple ways of knowing and being and welcome such contradictions in their decision-making. In the context of business, paradox requires leaders to refrain from instinctually resolving contradictions, as doing so can eliminate critical differences in thought.

“Leaders are facing more complex challenges,” Smith said. “Both/and thinking offers the opportunity to effectively navigate these issues.”