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Psychological safety: Why some companies thrive on innovation while others freeze in time

Published on May 30, 2024 by Author photo Rūta Bakanaitė
Psychological safety: Why some companies thrive on innovation while others freeze in time

The term ‘psychological safety’ has been widely used by CEOs, HR specialists, and others within the wellness industry, so much so that it has become a buzzword — often seen as a psychological alternative to the ‘Health and Safety at Work Act’, focused on protecting workers’ physical health. However, the concept of psychological safety is specifically related to communication within the workplace, which has a significant impact on company culture and the occurrence of critical mistakes. It explains why some organisations thrive on innovation, while others freeze in time or get involved in various scandals.

Chernobyl: The origins of psychological safety research

In the organizational context, the term ‘psychological safety’ was first used to describe team dynamics before the nuclear disaster in 1986, after the release of the Chernobyl Accident Report. The report explains that there was a growing concern among employees about the ongoing experiments, but their warnings were repeatedly ignored and remarked by statements such as:

  • “I’ve been doing this job for a lot longer than you.”
  • “This is a directive from above; do you really think you know better?”
  • “If you can’t follow orders, maybe this isn’t the job for you.”

The report states that there was pressure from the generals to complete tests on a tight schedule, prompting Chernobyl’s chief engineer to deliberately bypass and disconnect important safety systems. On top of this, power plant engineers weren’t aware of a critical design flaw — control rod tips were made of graphite — which, when attempting to shut down the reactor in unstable conditions, led to a dramatic surge in power.

Hans Bethe, a member of the committee of experts who analyzed the incident, said, “The Chernobyl disaster tells us more about the deficiencies of the Soviet political and administrative system than about problems with nuclear power.” This disaster provides a gruesome reminder of what can happen to an institution when there’s a lack of psychological safety, namely:

  • Employees can’t voice their concerns out of fear that they’ll be fired or humiliated.
  • Critical information within the organisation is hidden or concealed.
  • Upper management continues to put pressure, unaware of growing problems.

Although numerous factors contributed to the Chernobyl disaster, such as design flaws and inadequate staff training, the accident report reveals that a toxic workplace dynamic was a crucial enabler of the unsafe and unfair conditions to which the employees were subjected.

Boeing: A modern case study of psychological safety 

According to Amy Edmondson, a Professor of Leadership at Harvard Business School, the workplace dynamic observed at Chernobyl is not an isolated incident; such a culture can emerge anywhere, at any time, and in any organization. A recent example is Boeing, an American multinational corporation that designs, manufactures, and sells airplanes, rockets, satellites, and missiles worldwide.

“Before the McDonnell Douglas acquisition, Boeing was the best plane maker in the world. But new executives emphasized profitability and return of investment (ROI) over engineering quality, leading to a cultural shift over time.”

Charles H. Gessner, investigative reporter and airline consultant.

For years, Boeing’s culture has been described as “broken,” filled with “secrecy and intimidation.” Employees were notoriously afraid to speak up about internal problems, whilst management continued to cut operational costs. One senior manager at the Boeing factory sent an email listing his concerns about excessive schedule pressure, worker fatigue due to too much overtime, and managers not role modeling desired behaviours. Just four months after this email, the Boeing 737 MAX aircraft crashed into the Java Sea in 2018, followed by another crash in Ethiopia in early 2019. Due to these accidents, Boeing’s reputation was ruined, and its revenue has yet to recover as of 2024.

Annual losses/earnings of Boeing: company reports, Macrotrends

How toxic work culture can occur anywhere

The examples of Chernobyl and Boeing are well-investigated, high-profile cases that illustrate the deadly consequences a lack of psychological safety can have. That said, similar workplace dynamics can easily occur on a smaller scale.

“The greatest fear as a CEO is that people aren’t telling you the truth.”

– Mark Costa, CEO of Eastman Chemical Company.

It’s not hard to imagine a scenario, where a project manager is presenting a flawed strategy that could lead to costly mistakes. An employee notices the flaw but is too afraid to speak up. As a result, the project moves forward, mistakes happen, leading to lost revenue and damage to the company’s reputation.

Or, imagine a tech company that has gradually developed a hierarchical and rigid corporate culture. In team meetings, creative and out-of-the-box thinking employees aren’t given the space to share their ideas, or are quickly dismissed. This discourages team members from proposing new, potentially game-changing solutions. Over time, the company begins to lose its edge in a competitive market.

Looking at these examples, we can easily see how such dynamics can occur anywhere, regardless of industry, country, or economic situation. Sometimes, they can lead to scandals and even fatalities, but in most cases, they simply result in a decline in the company’s performance.

How to measure psychological safety at work

Ask yourself these questions:

  • If employees make a mistake on my team, will it be held against them?
  • Do the members of this team often hide the truth or attempt to conceal negative information?
  • Do members of this team seem hostile toward others for having different opinions?

Only by recognising a lack of psychological safety in your team is it possible to shift company culture towards openness, innovation, and creativity. One way to do this is to gather your team’s opinions through anonymous online surveys. At WorkThrive, we offer a scientifically validated survey that can systematically measure psychological safety in your team. Reach out to our team to learn more. 

About WorkThrive Consulting

WorkThrive is a boutique consulting firm made up of consultants who apply their expertise in business psychology to initially support company leaders and subsequently their workforce.

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