Leadership   //   November 28, 2023

Why employer misunderstanding of psychological safety is hurting teams’ performance

Employers don’t have a grip on their staff’s psychological safety – and that’s very bad for business, experts warn. 

The term, which refers to the workplace philosophy that the best business results and employee performance are achieved when staff feel comfortable enough to flag that they believe mistakes are being made, without fear of reprisals, is being fundamentally misunderstood within organizations. And the knock-on effect on employee and business performance will be serious, experts say. 

Just 16% of HR executives say they are clear on what psychological safety actually means, according to a recent report by behavioural consultancy Behave, which surveyed more than 200 senior decision makers in HR roles in the U.K. this August. And several experts, who work extensively with business leaders on organizational strategy, spoken to for this article confirm that this is not a U.K.-only problem, but a universal one across continents including the U.S. 

Business leaders are mistaking it for “being kind or nice,” and fostering a culture of “bringing your whole selves to work,” stressed Dr Alexandra Dobra-Kiel, innovation and strategy director at Behave. Its core meaning – being comfortable with feeling discomfort at work – is being skated over. “I’m not saying it’s about the opposite – being awful to each other – but it has nothing to do with kindness. It is to do with candid honesty,” added Dobra-Kiel. “So if someone wants to speak up, and speaking up would actually contribute to twice the performance, that person should do it. So it’s that radical candor that’s truly at the heart of this concept.”

The term psychological safety gained traction after the coronavirus pandemic when businesses leaned in further to the importance of employee well-being. And during that time, it got stretched to relate to non-work issues too such as polarizing questions like whether to wear masks. And while some businesses, (Google and Microsoft are among those to have claimed success with embedding psychological safety within teams), have had success with it, the traction it gained within most organizations hasn’t yielded the expected results, because of its misapplication, added Dobra-Kiel. 

If left unchecked, this misuse of the concept will create yet more “yes-men and yes-women” cultures, which sail dangerously close to another workplace plague: toxic positivity. This often well-intentioned focus on being positive – at all costs – can have a seriously damaging effect on not only morale, but business outcomes. It confuses an employee’s desire to flag issues that may arise in order to improve the performance of either their team or a specific product, with their being negative or not a team player. But that undermines any balance that negative emotions bring with the positive. 

“A leader is someone who can recognize that they do not have all the answers, who recognizes that they are human, and that the only way that they learn and grow and bring people on a journey and mission with them is actually by listening, not hearing.”
Sope Agbelusi, executive coach and expert on cultural change.

Harvard Business School professor Amy Edmondson, who has studied the concept of psychological safety for more than two decades, agrees that it has been largely misunderstood across a large number of organizations. “The connective tissue here is that it’s being understood as ‘you will be comfortable, but really it’s about believing it’s OK to be uncomfortable,” she said. “It’s never comfortable to point out someone’s mistake at the bedside in a hospital, or disagree with the boss’s view in the discussion of an important new product launch. I think all of those things are inherently hard, but necessary in a dynamic world where continuous innovation and learning and improvement are required for success.”

To gain the benefits of psychological safety, leaders need to be comfortable acknowledging when they don’t have answers to a problem and invite ideas from everyone. Showing that vulnerability is a tall order for some – especially if there is a lack of trust that all their team members will get on board. “Psychological safety can be weaponized,” said Sope Agbelusi, executive coach and founder of leadership development company Mindsetshift. “It can be used against leaders because there will always be one or two people who think ‘this is too personal, or too vulnerable’ and they will challenge it.” This is particularly problematic once a company grows from being a startup to major player with thousands of staff. Keeping that same culture threaded through while growing rapidly, is tough and any efforts to embed psychological safety can easily be lost, he stressed.

This modern approach to working can often be looked down on by seasoned workers in particular, who may push back on a manager who wants to trial it. But to achieve the best performance, leaders need to stand firm and keep their eye on the business goal, added Agbelusi. “A leader is someone who can recognize that they do not have all the answers, who recognizes that they are human and that the only way that they learn and grow and bring people on a journey and mission with them is actually by listening, not hearing,” he said. “I think what we have are a lot of managers masquerading as leaders. And those are people who know how to like do tasks, or those who have been rewarded by their technical prowess.”

Changing the language to get buy-in from skeptics

Part of the reason why psychological safety is being misunderstood or misapplied is that it’s been outsourced to HR departments by business leaders who are more preoccupied with the numerous business headwinds they’ve had to grapple with over the last few years, than worrying whether their employees feel comfortable or not. Their belief that this is “HR fluff” and a nice-to-have, rather than a business imperative, highlights the depth of the misunderstanding. 

And in a way, the language used to describe this workplace ethos is partly to blame, according to Per Hugander, strategic advisor to Swedish corporate bank SEB, who has helped the organization define a new leadership philosophy and a strategy to change the leadership culture, which heavily featured establishing a foundation of psychological safety. Part of this involved months of workshops and leadership coaching, where employees learned how to leverage psychological safety to make progress on important challenges. 

Hugander, who was hired by SEB in 2017 to make these changes, believes that the term itself is holding many executives back from seeing it for what it really is – a work construct that cultivates innovation, heightens performance and is a crucial part of strategic decision making. “It’s very easy to outsource this to HR, but you can’t expect HR representatives to be very comfortable giving executives advice on how to make strategic decisions,” said Hugander. 

The language used to describe this workplace philosophy is holding back many executives from buying into it. Words like “psychological” and “safety” can get dismissed as being “soft” and appear alien to the “hard language” of executives – especially the more cynical executives, stressed Hugander. 

HR and chief people officers, who work in the realm of employee well-being, tend to lean into the elements of psychological safety that benefit employee wellness, and improve talent retention. But for Hugander, these are positive “side effects” of applying psychological safety correctly, and make it easier for other C-suite executives to dismiss it as not critical for business. 

“If someone wants to speak up, and speaking up would actually contribute to twice the performance, that person should do it. So it’s that radical candor that’s truly at the heart of this concept.”
Dr Alexandra Dobra-Kiel, innovation and strategy director, Behave.

“The way I solve it is that I don’t talk about the positive side effects. For me, psychological safety is about getting the right information on the table so we can make good decisions,” said Hugander. “So people need to dare to challenge their superiors and each other and they need to dare to be vulnerable about shortcomings, and if they don’t, we don’t get the right input. If we can create that atmosphere, which is psychological safety, we’ll get the right input, then we can start solving problems but without that input, we have no chance of solving the problems.” 

And with that, the positive side effects – employee well-being, less stress and more fun at work, enjoying achieving good results, people feeling comfortable being themselves – all happen organically.

In Psychology Today, Hugander and Edmondson co-authored an article that references how SEB worked on integrating psychological safety. In the article, they quoted an SEB executive anonymously. “The results came quicker than we expected, and they came in the shape of quicker decisions, better decisions. You slow down to speed up. Strategic problems that had been around for a while, we were able to solve them relatively quickly. Internally and with external stakeholders,” this exec said. 

This summer, SEB was named one of the top five innovative banks by Global Finance Magazine. For Hugander, who works as a strategic advisor in the risk organization within SEB, psychological safety is fundamental to its competitive success. “We’ve identified that psychological safety is very important to the [making of] high-quality decisions that we need,” he said. 

To improve performance and bottom-line results, it’s critical to create a psychologically safe work environment that tease out the best quality decisions, stressed Hugander. “But if you’re a skeptic you will only hear the stuff that makes it easy to shoot this down, which is that it’s all about those side effects. You don’t have to convince HR of the benefits of psychological safety. And you don’t have to convince a person who goes to all the self-leadership courses that’s in your management team. You have to convince the CFOs, the skeptics, the engineers, and to them you can leave out the side effects, and talk about the importance of good, high-quality input to your decisions,” he added.