A Consultant's View

Prairie Trail Software, Inc. ............................................................. March 2009

Is your business being affected by fears?

Layoffs, stock market crashing, foreclosures, etc. Our people are hearing a lot of news that make them afraid. While having fear is normal for entrepreneurs and business owners, it is something new for most people. Some researchers have found that the fear of job loss has more impact on us than actually losing a job. People don't know how to handle all this fear and often react with the wrong results.

People react to fear without thinking, literally. Our brains are wired so that we will react to fear faster than we can think about the situation. Our eyes and ears send signals directly to that part of the brain that reacts. Only after we have reacted do the signals go up to the part of our brain that can reason. However, our bodies have already started to react and we have adrenaline flowing in our veins. Often, once we are in a fearful situation, we will continue to react without having the capability to think.

While there are some bosses that like their workers afraid and not thinking, in most cases that is very counter productive. People who are afraid do not make good decisions and often take wrong actions or take no action when the situation calls for action. The "whistle blower" at Enron, Sherron Watkins talked about her days there, "The corporate culture was such that most people didn't have time to focus on the problems because they were too focused on job security." People were too worried about their jobs to do the right thing.

That is not the only way fear can cause problems for a company. The man who showed the Japanese towards how to compete with Detroit, W. Edwards Deming, has 14 points of how to build a quality organization. His number 8 point is, "Drive out fear, so that everyone may work effectively for the company." He also points out that where there is fear, the measurement data will have errors. It is dangerous to rely on data contaminated by fear. In case after case, people have "fudged" the measurements, adjusted the settings, and misread instruments while under fear. Deming says that people will do what ever they have to do "even if they have to destroy the enterprise to do so." People will make serious mistakes that sometimes compound into major problems for the business.

Fear can be picked up from others. Children pick it up from their parents. When the bosses are afraid, the workers often pick it up and pass it along to others in the company. In such a situation, a panic can spread in the company and progress on problems slows to a halt.

Not only does fear cause us to make mistakes, fear keeps us stuck in the old ways of dealing with situations when the business situation calls for us to take new steps to remain competitive.