The optimistic organization: Leadership lessons from neuroscience

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By Dino Signore

Recently I’ve been reading “Buddha’s Brain,” a book by Rick Hanson that looks at the relationship between neuroscience and our mental states. In a nutshell, it discusses how individuals can take an active role in altering neural activity to achieve greater happiness, love and wisdom.

This has led to me think about the impact of optimism in business. Researchers have shown a correlation not only between optimism and being healthier and happier, but also being more effective at leading others.

Yet being optimistic is no soft skill because the human brain is wired to be negative. This bias served our ancestors well, for the Earth is a hostile place where humans are part of the food chain. To continue to live and reproduce, we need to be able to eat — and avoid predators that want to eat us.

Our brains have evolved in such a way that information about threats is processed faster than information about rewards and opportunities. Negative events have more impact on our memories than pleasant ones. Even fleeting thoughts of anxiety and fear can activate our sympathetic nervous system to initiate the fight-or-flight response in our bodies. Granted, a little stress can be a good thing, yet too much causes physical damage (ranging from ulcers, colitis, heart problems) along with mental problems.

OK, now for the good news: Neuroscience shows that our brains have plasticity, and synapses (neural connections) can be re-formed. People can use their minds to restructure their brains to be more positive and reap the benefits of optimism.

The corporate brain

This matters from a higher level because optimism is contagious. The business leaders’ mental state significantly affects people around them: customers, suppliers — and especially subordinates. By being optimistic, a leader encourages a culture of:

  • Creative thinking and generation of new ideas.
  • A tendency to act, which is important in executing strategy.
  • Persistence in a chosen course of action that is difficult.
  • Resiliency, your ability to bounce back after a failure.

Just to be clear here, I’m not talking about being overly optimistic and embracing Pollyanna-like thinking. In fact, research studies also show that extreme optimism can be harmful as we may underestimate a risk and make poor strategic plans. Yet moderate, authentic optimism appears to be a critical ingredient in effectively growing a business.

I asked Dave Galbenski, who is one of the most positive entrepreneurs I know, to what degree optimism has impacted his ability to lead. Founder of Lumen Legal, a legal staffing company in Troy, Michigan, Dave has built an organization that generates more than $10 million in annual revenue and has offices in six states.

Dave says he views optimism as a precursor to success — whether it’s success in business, relationships, or making an impact on the world. He also has an interesting definition of optimism: “the ability to manage yourself in a crazy environment.”

He points to 2009 when his industry shrank by 40 percent. Major clients went bankrupt, leaving Lumen Legal with significant receivables that went unpaid. In response, Dave asked everyone to take a pay cut so they could maintain as many jobs as possible. He also managed relationships with suppliers and vendors from a cash flow standpoint. “Yet in addition to facing the brutal reality and confronting these things head on, we also spent a lot of time re-thinking our business model and painting a positive picture of what our company would look like when things got better,” Dave says.

Within a year, Lumen Legal was not only able to rebound from a 33 percent plummet in annual revenue but also to achieve a significant increase in profits.

Dave admits that even though optimism comes easily for him, there are still times he has to work at it. “Even the most positive person is going to have some bad days,” he says. “What I do is consciously try to shrink the time that I’m in any kind of negative thought process. If a setback happens, I recognize it and understand the negativity, but then minimize the time I spend in that mental state. I can’t completely eliminate the experience — but I can use my mind to quickly move beyond it.”

I really like what Dave is saying here. He’s thinking about his thinking — and how he can change it. He recognizes that he might become angry or upset, but then separates his thoughts from those negative feelings as soon as possible.

Practice makes perfect

 With that in mind, here are some exercises that can help you and your team think about your thinking and generate greater positivism for the organization: 

  • Think about where you want to end up.
  • Imagine what reaching those goals would mean for everyone. (Focusing on future positive events has powerful effects on the brain — and it makes those events seem closer and more accessible.)
  • Revisit those expected positive outcomes both by yourself and during conversations with team.
  • When dealing with people who are in conflict, have them imagine what it would look like if they both got what they wanted and it helped the organization.
  • Think of something you are glad about, either currently or in the past. (Simple ones work best.)
  • Bring to mind someone you like.
  • Think of things that make you feel strong.
  • Be thankful for what you have. Wish for good things for others.
  • Appreciate the little things — especially something pleasant you may be experiencing now.

Running a growing business is fraught with complex challenges, and it’s not unusual to feel pessimistic or anxious when faced with challenges. Yet the optimistic leader understands that most challenges are external. They cultivate a healthy sense of resiliency that is intrinsic — and transfer that resiliency throughout the organization.

Back to Dave, who believes there is an important link between optimism and being able to paint a picture of what the future looks like. “Because you see things a little differently,” he says, “you can articulate a vision in a way that connects with other people and inspires them.”

 

Copyright © 2018 by Edward Lowe Foundation

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Dino Signore, PhD
Manager of Entrepreneurial Education
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Second stage is an important inflection point for entrepreneurs, says Dino Signore, the foundation's manager of entrepreneurial education. On the plus side, second-stagers have a proven product or service under their belts and have attracted initial customers, so survival is no longer a daily concern. Yet as they strive to gain a stronger foothold in the market and win more customers, second-stagers now face more strategic issues, such as building infrastructure to scale, honing their competitive edge and expanding into new markets.