How much is a gallon of milk at your favorite grocery store? How much is a pound of butter? I’m going to assume that most of you don’t know the exact price. My confidence is based on research by Eldar Shafir of Princeton University and Sendhi Mullainathan of Harvard University. Shafir and Mullainathan are studying the effects of scarcity – in this case, it would be scarcity of money – on decision-making and how it can create its own psychology and set of cognitive traits.
Most of you likely don’t know the answers to my initial questions because you don’t have to. You are not faced with the necessity of scrutinizing small daily purchases. As David Brooks reported in his article, The Unexamined Society, which highlighted Mullainathan and Shafir’s research, “People with limited financial resources have to think hard about a million things that affluent people don’t.” These daily life decisions, imposed by financial scarcity, place increased demands on one’s cognitive and emotional resources.
Shafir and Mullainathan also found that scarcity negatively impacts IQ scores and attention span. The study measured farmers pre- and post-harvest and noticed that pre-harvest they possessed a scarcity mindset, which reduced their performance on tests, attention span and their ability to maintain a future orientation. This is understandable. Not knowing if your crop will yield the results you expect, one must be judicious in how resources are used. Once the harvest is in and it meets expectations, farmers are no longer burdened with thoughts of scarcity. And in Shafir and Mullainathan’s study, once the scarcity mind-set was lifted the farmers’ test performance and attention spans improved, as well as their ability to think and plan for the future.
Shafir and Mullainathan’s work led me to reflect on the psychological, emotional, physical and behavioral effects that scarcity has on employees and organizations. We’ve all felt and experienced the effects of scarcity. Scarcity of time, resources to complete a project, money, and even calories all impact our ability and capacity to perform at our best. Gallup reports that one of the top issues that fosters disengagement with employees is not having the right and or needed resources to do their job.
There is another scarcity that I am convinced is as impactful as any other and is implicated in every reason reported by employees as causes for disengagement with their jobs, managers and/or organizations. I call it Recognition Scarcity.
Before we look at what recognition scarcity is, I want to present a broader perspective that is directly linked to this concept. Workforce engagement is a relatively new way of assessing the level of vigor, dedication, absorption (the ability to fully concentrate) and productivity of an organization’s workforce, which has emerged as a critical driver of business resiliency and success.
National and global surveys of employee engagement provide what is akin to an x-ray of an organization’s workforce. What we are finding is that within organizations the levels of workforce disengagement are severely impacting the organizations’ ability to retain and recruit talented human capital, creativity, productivity and resiliency. The enormity of the problem is estimated to be 350 billion dollars a year in lost productivity, accidents and turnover!
Disengagement Surveys
BlessingWhite 2011 Employee Engagement Report
67% of employees are disengaged (North America)
Gallup 2008 Study
54% of employees are disengaged (North America)
Towers Perrin Global Workforce Study 2008
66% of employees are disengaged (Global)
If these surveys aren’t enough to persuade leaders of the internal malady that is affecting their ability to be efficient and productive, a recent survey by the consulting company Mercer found that half of this nation’s workforce is unhappy, and a third of the employees are so miserable that they are seriously considering leaving their jobs.
The job and talent market is tough and probably going to get tougher. Companies cannot become or remain competitive, attractive and successful if they don’t retain their talented and committed employees and convert as many of the disengaged as possible. It makes great business sense to invest in workforce engagement strategies; your organization’s financial performance could improve along with your employee’s performance. Towers Perrin claims that for every 15% increase in engagement there is a 2% improvement in operating margin.
It doesn’t matter what level or position you are on the organizational totem pole; ultimately you’ve seen and felt the effects and consequences of disengagement and recognition scarcity – a continuous lack of appreciation, respect and/or gratitude shown by management for an employee’s hard work. Recognition scarcity has many symptoms, but primarily it weakens the vitality, dedication and absorption employees have in their work, their team and/or their organization.
One of my coaching clients described his experience and perception of his boss’s management style as the mushroom style of management: “He keeps me in the dark and keeps tossing in more and more manure on me. I’ve never heard a thank-you or a hint of recognition for all the work I do and the additional work he keeps putting on my plate.” My client was suffering from recognition scarcity. His vitality, dedication and ability to focus on his work was diminishing rapidly. Mushrooms thrive in this type of environment, but humans don’t; in fact, they wither.
Humans have fundamental needs for social acceptance, increased self-esteem and self-actualization. The more they authentically experience these needs and feelings, the more their vitality increases, allowing them to better focus on their work – which only benefits their organization.
One of the most severe tortures a human can experience is to be deprived of human interaction. Studies have shown that this type of deprivation can cause physical, emotional and psychological problems in all mammals. Tom Hanks in the movie Cast Away gives one an empathetic experience of isolation and desperation when, while deserted on an island, he befriends a soccer ball he names Wilson. There is a wrenching scene in which Hanks and Wilson become separated at sea
Although torture and Hanks’ film are extreme examples of the effect of isolation, how one perceives their situation is what is critical. My client felt confused, angry and disillusioned, which was taking a toll on his work and his self-esteem. He said in one session, “I’ve got to get out of this situation before I go crazy.”
In their book, Winning with a Culture of Recognition, Eric Mosley and Derek Irvine refer to recognition as psychic income, which they additionally point out is more affordable, flexible and immediate than the traditional “carrot and stick” motivators of salary, benefits and awards.
In his book, Carrots and Sticks Don’t Work, Paul Marciano says, “The most important job of a leader is to increase the value of the company’s human resources. Recognizing employees increases their discretionary effort and, in turn, increases the human capitol of the organization.”
I think the message and case are compelling; recognition scarcity is a virus that sucks the vitality, dedication and psychological capacity for employees to be creative and absorbed in performing their work to the best of their ability. Eldar Shafir and Sendhi Mullainathan’s research indicates that a scarcity mindset reduces mental capacity, performance capacity and attention span. When recognition is scarce – or worse yet non-existent – in teams and organizations, you can expect overall workforce engagement to decrease, which increases your organizational susceptibility and vulnerability to effects of the fast-paced, demanding and competitive business environment we all live in.
There is another positive benefit to recognition beyond its critical role in building employee engagement. The mood and climate today is pessimistic, polarized and cynical, therefore it is easy as a manager to become a victim of recognition scarcity when it is difficult to find anything positive worth recognizing – but by practicing the Recognition Strengthening exercises below you can bring balance and vitality into your life as well as those closest to you, in or out of work. There is a reciprocal ROI to recognition. It’s not just for them; it’s a gift for you also.
Strengthening Your Recognition Muscle
· Everyday think of 3 people or things you are grateful for or appreciate and write them down. As you think and write you will feel an increase in vitality.
· Write one personal note a week to someone thanking him or her for a contribution they made to your team or organization.
· Recognize effort as well as outcome and give recognition for it as well as a job well done.
· Practice giving feedback that is balanced by providing what you liked with what needs to be improved.
· At every team meeting be conscious of what each member contributes to the agenda and the process of the meeting, and as soon as possible after the meeting make a point to touch base individually with him or her to let them know what it is they contributed.
You can prevent Recognition Scarcity from incapacitating your team and organization and start building your recognition muscle and culture of engagement with the Creating High-Performing Relationships the EQ Way program. See the Events section for the next program
© The Renewal Group 2011, All Rights Reserved
Most of you likely don’t know the answers to my initial questions because you don’t have to. You are not faced with the necessity of scrutinizing small daily purchases. As David Brooks reported in his article, The Unexamined Society, which highlighted Mullainathan and Shafir’s research, “People with limited financial resources have to think hard about a million things that affluent people don’t.” These daily life decisions, imposed by financial scarcity, place increased demands on one’s cognitive and emotional resources.
Shafir and Mullainathan also found that scarcity negatively impacts IQ scores and attention span. The study measured farmers pre- and post-harvest and noticed that pre-harvest they possessed a scarcity mindset, which reduced their performance on tests, attention span and their ability to maintain a future orientation. This is understandable. Not knowing if your crop will yield the results you expect, one must be judicious in how resources are used. Once the harvest is in and it meets expectations, farmers are no longer burdened with thoughts of scarcity. And in Shafir and Mullainathan’s study, once the scarcity mind-set was lifted the farmers’ test performance and attention spans improved, as well as their ability to think and plan for the future.
Shafir and Mullainathan’s work led me to reflect on the psychological, emotional, physical and behavioral effects that scarcity has on employees and organizations. We’ve all felt and experienced the effects of scarcity. Scarcity of time, resources to complete a project, money, and even calories all impact our ability and capacity to perform at our best. Gallup reports that one of the top issues that fosters disengagement with employees is not having the right and or needed resources to do their job.
There is another scarcity that I am convinced is as impactful as any other and is implicated in every reason reported by employees as causes for disengagement with their jobs, managers and/or organizations. I call it Recognition Scarcity.
Before we look at what recognition scarcity is, I want to present a broader perspective that is directly linked to this concept. Workforce engagement is a relatively new way of assessing the level of vigor, dedication, absorption (the ability to fully concentrate) and productivity of an organization’s workforce, which has emerged as a critical driver of business resiliency and success.
National and global surveys of employee engagement provide what is akin to an x-ray of an organization’s workforce. What we are finding is that within organizations the levels of workforce disengagement are severely impacting the organizations’ ability to retain and recruit talented human capital, creativity, productivity and resiliency. The enormity of the problem is estimated to be 350 billion dollars a year in lost productivity, accidents and turnover!
Disengagement Surveys
BlessingWhite 2011 Employee Engagement Report
67% of employees are disengaged (North America)
Gallup 2008 Study
54% of employees are disengaged (North America)
Towers Perrin Global Workforce Study 2008
66% of employees are disengaged (Global)
If these surveys aren’t enough to persuade leaders of the internal malady that is affecting their ability to be efficient and productive, a recent survey by the consulting company Mercer found that half of this nation’s workforce is unhappy, and a third of the employees are so miserable that they are seriously considering leaving their jobs.
The job and talent market is tough and probably going to get tougher. Companies cannot become or remain competitive, attractive and successful if they don’t retain their talented and committed employees and convert as many of the disengaged as possible. It makes great business sense to invest in workforce engagement strategies; your organization’s financial performance could improve along with your employee’s performance. Towers Perrin claims that for every 15% increase in engagement there is a 2% improvement in operating margin.
It doesn’t matter what level or position you are on the organizational totem pole; ultimately you’ve seen and felt the effects and consequences of disengagement and recognition scarcity – a continuous lack of appreciation, respect and/or gratitude shown by management for an employee’s hard work. Recognition scarcity has many symptoms, but primarily it weakens the vitality, dedication and absorption employees have in their work, their team and/or their organization.
One of my coaching clients described his experience and perception of his boss’s management style as the mushroom style of management: “He keeps me in the dark and keeps tossing in more and more manure on me. I’ve never heard a thank-you or a hint of recognition for all the work I do and the additional work he keeps putting on my plate.” My client was suffering from recognition scarcity. His vitality, dedication and ability to focus on his work was diminishing rapidly. Mushrooms thrive in this type of environment, but humans don’t; in fact, they wither.
Humans have fundamental needs for social acceptance, increased self-esteem and self-actualization. The more they authentically experience these needs and feelings, the more their vitality increases, allowing them to better focus on their work – which only benefits their organization.
One of the most severe tortures a human can experience is to be deprived of human interaction. Studies have shown that this type of deprivation can cause physical, emotional and psychological problems in all mammals. Tom Hanks in the movie Cast Away gives one an empathetic experience of isolation and desperation when, while deserted on an island, he befriends a soccer ball he names Wilson. There is a wrenching scene in which Hanks and Wilson become separated at sea
Although torture and Hanks’ film are extreme examples of the effect of isolation, how one perceives their situation is what is critical. My client felt confused, angry and disillusioned, which was taking a toll on his work and his self-esteem. He said in one session, “I’ve got to get out of this situation before I go crazy.”
In their book, Winning with a Culture of Recognition, Eric Mosley and Derek Irvine refer to recognition as psychic income, which they additionally point out is more affordable, flexible and immediate than the traditional “carrot and stick” motivators of salary, benefits and awards.
In his book, Carrots and Sticks Don’t Work, Paul Marciano says, “The most important job of a leader is to increase the value of the company’s human resources. Recognizing employees increases their discretionary effort and, in turn, increases the human capitol of the organization.”
I think the message and case are compelling; recognition scarcity is a virus that sucks the vitality, dedication and psychological capacity for employees to be creative and absorbed in performing their work to the best of their ability. Eldar Shafir and Sendhi Mullainathan’s research indicates that a scarcity mindset reduces mental capacity, performance capacity and attention span. When recognition is scarce – or worse yet non-existent – in teams and organizations, you can expect overall workforce engagement to decrease, which increases your organizational susceptibility and vulnerability to effects of the fast-paced, demanding and competitive business environment we all live in.
There is another positive benefit to recognition beyond its critical role in building employee engagement. The mood and climate today is pessimistic, polarized and cynical, therefore it is easy as a manager to become a victim of recognition scarcity when it is difficult to find anything positive worth recognizing – but by practicing the Recognition Strengthening exercises below you can bring balance and vitality into your life as well as those closest to you, in or out of work. There is a reciprocal ROI to recognition. It’s not just for them; it’s a gift for you also.
Strengthening Your Recognition Muscle
· Everyday think of 3 people or things you are grateful for or appreciate and write them down. As you think and write you will feel an increase in vitality.
· Write one personal note a week to someone thanking him or her for a contribution they made to your team or organization.
· Recognize effort as well as outcome and give recognition for it as well as a job well done.
· Practice giving feedback that is balanced by providing what you liked with what needs to be improved.
· At every team meeting be conscious of what each member contributes to the agenda and the process of the meeting, and as soon as possible after the meeting make a point to touch base individually with him or her to let them know what it is they contributed.
You can prevent Recognition Scarcity from incapacitating your team and organization and start building your recognition muscle and culture of engagement with the Creating High-Performing Relationships the EQ Way program. See the Events section for the next program
© The Renewal Group 2011, All Rights Reserved
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