A sense of hope is different than being “optimistic,” which generally has a positive view of the future but not the desire or ability to create that future.
By Miriam Lacey
Approximately 42 million employees voluntarily quit their jobs in 2018, costing U.S. businesses $1 trillion dollars according to a recent Gallup study. Fifty-two percent of voluntarily exiting employees stated their organization or manager could have done something, other than a pay raise, to prevent them from leaving their job.
Today, entrepreneurs and organizations have tremendous pressure to maximize output while minimizing costs. They also must help employees adapt to changing market demands. This new business model has a negative effect on most employer-employee relations, causing employees to lose hope in a better future. The loss of hope creates an environment undermining employee engagement and productivity. In the end, long-term competitiveness and the organization’s bottom line suffers.
A sense of “hope” is different than being “optimistic,” which generally has a positive view of the future but not the desire or ability to create that future. Hope has two important components– being proactive towards achieving set goals and having “pathways” to achieve those goals. Recent research shows entrepreneurial startups that create a “high hope” environment can increase productivity and foster higher performing employees. Hope is the key success factor in entrepreneurial ventures.
High-hope organizations are led by entrepreneurs highly involved with employees in a formal goal-setting process. The process includes accountability sessions or check-ins between the leader and employees and instills clear and proactive communication. Entrepreneurs in a high-hope company have a strong physical presence, frequent supportive interactions with employees, seek teaching opportunities, and are highly aware of employee accomplishments and acknowledge them accordingly through words of encouragement. Flexibility to reach company goals is perceived positively, empowered employees to find creative solutions to problems, making the company more effective. Research has indicated a positive correlation between high-hope leadership and employee satisfaction and the likelihood of employee retention.
Conversely, entrepreneurs that lead a low-hope organization are not involved in the creation or achievement of their employees’ goals, nor are they aware of their perceived poor performance in this area. Entrepreneurs are frequently absent, and employees are not recognized for their achievements and view the leader with animosity. Lack of commitment to their successes within the company forces employees to be self-motivated and fearful of the consequences of failure. Flexibility to reach company goals are viewed negatively and as an affront to management goodwill and studies have indicated low-hope organizations have lower financial performance and higher employee turnover rates.
Entrepreneurs must recognize that behavioral changes can make a difference in the climate of their organization. In order to create a high-hope environment business, leaders must:
- Be physically present, regardless of the popular business practices such as virtual work teams, outsourcing, and over-reliance on communication technology.
- Create a proactive and ongoing communication channel. Offer personalized, supportive, and consistent interaction with employees.
- Jointly establishing and be accountable for goals, as well as celebrate accomplishments and give recognition when deserved.
- Use a mistake or failure as a teaching moment, examine the work process, seek ways to avoid such errors in the future, discover ways the company can improve, and share lessons with all employees.
Entrepreneurs who leverage this knowledge and the power of optimizing a high-hope environment not only create an efficient and thriving organization but reduce the number of voluntarily quits and the cost burden on an organization. A startup with a high-hope environment can be the key difference in whether the company succeeds or fails.
Miriam Lacey, Ph.D., is an executive professor of applied behavioral sciences at Pepperdine Graziadio Business School and works with Fortune 500 companies to implement change for greater quality, productivity, and employee commitment. Research was done in partnership with Charlotte Law, MSOD, founder of High Impact & Coaching Systems.