How Fear Destroys Companies from the Inside Out

How Fear Destroys Companies from the Inside Out

by Tom Rieger

The recession may be over, but the anxiety and fear that has spread has firmly rooted itself in "the new normal.”  Gallup has found that half of American workers feel like they are prisoners in their own company.  Regardless of industry, company size, job level, or function, a vast number of employees feel caught in a tide and powerless to do anything about it.  The resulting cost to organizations - in productivity, profits, and customer engagement - is exorbitant.

In his new book Breaking the Fear Barrier: How Fear Destroys Companies From the Inside Out and What to Do About It (Gallup Press; August 23, 2011), Gallup executive Tom Rieger draws on the company's global research across a dozen countries spanning six continents to identify the "fear barrier" and to show how and why fear destroys companies.  The book explains how to transform a fear-plagued organization into one that is courageous and unstoppable.  As Senior Practice Expert for Gallup, Rieger led the consulting effort to examine numerous companies that had, in their own words, "become stuck.”  In these companies, whether they were banks, manufacturers, retailers, or call centers, the story was the same.  Strategically, they were doing everything right, but something -- a "barrier" -- was getting in the way.  No matter what these companies tried, no matter what they did, they just could not stop a slow downward slide.  "It was like watching the same movie over and over again," says Rieger.

Given the uncanny similarities, Rieger began documenting and studying the barriers in each company.  His team dug into policies and procedures and interviewed people at various levels in the organizations.  Their research spanned different industries, functions, and job types in both the public and private sectors and uncovered one overarching factor: "What we found was that ultimately, fear leads companies to self-destruct," says Rieger.  With fear identified as the culprit, Rieger turned to psychology for answers -- specifically, the work of Daniel Kahneman and Amos Tversky.  Their research on the psychology of loss gave Rieger a breakthrough insight: Fear, specifically fear of loss, leads people to protect their entitlements, even if it clearly harms the overall organization.  The best way to protect what's yours -- whether it's a position of power, budget, or headcount -- is to put barriers around it.  It's human nature.  And while those walls may shelter one person or group, they leave others in the organization out in the cold.

In Breaking the Fear Barrier, Rieger identifies the three levels of the pyramid of bureaucracy:

Parochialism: a tendency to force others to view the world from only one perspective or through a narrow filter, when local needs and goals are viewed as more important than broader objectives and outcomes

Territorialism: hoarding or micromanaging internal headcount, resources, or decision authority in an effort to maintain control

Empire building: attempts to assert control over people, functions, or resources in an effort to regain or enhance self-sufficiency

Each level of the pyramid is a defensive response, and each creates rampant bureaucracy -- which in turn limits success, crushes employee engagement, and infuses a sense of futility across an organization.  Throughout his engagements with these companies, Rieger saw firsthand how easy it is for fear to crush people and break their spirits and how quickly barriers can kill enthusiasm and energy.  These may seem like insurmountable obstacles, but Rieger maintains that because these barriers were built internally, they can be destroyed internally.  Before they figured out the root cause, his clients were convinced that these were problems they could never solve.  But once they began dissecting and breaking down the fear, the changes were nothing less than extraordinary.  Business results skyrocketed.  Service rankings changed from worst to first, turnover dropped dramatically, and sales increased, and morale improved.

In Breaking the Fear Barrier, Rieger offers a cohesive and groundbreaking process for breaking down each level of bureaucracy to remove the barriers.  Next, by proactively fostering courageous behavior among employees and keeping insidious "courage killers" at bay, leaders can root out fear in their organizations and establish a culture of confidence, engagement, and long-term success.