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Leading Off
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‘A leader is a dealer in hope,’ Napoleon famously mused (presumably, before a career-ending defeat at Waterloo). Particularly in times of crisis, people rely on leaders to inspire and inform, helping them cope with uncertainty and combat feelings of fear and anxiety. Research reveals that people tend to pay more attention to messages that are framed in a positive way. But does maintaining an optimistic outlook help you lead more effectively? This week, let’s look at what optimism has to offer leaders—along with what happens when there’s too much of it.
Mountain peak
In a crisis, balance optimism with reality
People expect their leaders to deliver messages of hope and inspiration. But confidence, when untethered to reality, can make leaders appear out of touch or uninformed. If leaders appear exceedingly confident while ignoring obviously difficult circumstances, they can lose credibility. Instead, leaders should practice “bounded optimism”—hopefulness grounded in reality. They can project confidence that the organization will overcome the present crisis but acknowledge that the situation is uncertain. For example, making promises about a return to normal during the COVID-19 crisis may cause disillusionment as the pandemic lingers. Rather, if leaders acknowledge that things may not go back to the way they were, organizations can focus on how best to move forward and help employees regain a sense of equilibrium.
Even though a positive team climate is the most important driver of psychological safety, McKinsey research finds, just 43 percent of respondents in a McKinsey Global Survey say that their leaders act in ways that foster a positive workplace. When executives demonstrate positive behaviors such as consulting team members and showing support for employees, they create a work environment that is both safer and higher performing. Such organizations are also more likely to innovate quickly and adapt well to change.
“If you believe that positive things will happen, it boosts your motivation to try harder, and that can change the actual outcome.”
That’s Tali Sharot, neuroscientist and professor at University College London, on how optimism can create a self-fulfilling prophecy in our careers. In other words, merely anticipating success may make it more likely for people to attain it, since they will probably push harder for positive outcomes. If you’re a leader who looks on the bright side of life, you’re in good company: one study of more than 1,000 CEOs based in the US found that 80 percent were more optimistic than the average person.
A photo of Tata Motors CEO and managing director Guenter Butschek
Pulitzer Prize–winning writer Thomas L. Friedman wants you to know that he’s an optimist. In a video interview with the McKinsey Global Institute, the foreign-affairs columnist describes how a sense of possibility shaped his journey from growing up in Minnesota to working for the New York Times. “I grew up in this amazing middle-class neighborhood, Saint Louis Park, Minnesota,” Friedman says. “It gave us incredible optimism about possibility.” However, he cautions against taking American exceptionalism for granted: the responsibility lies with leaders to make the right decisions, he explains.
A photo of rope and carabiner clip
We’re much more likely to expect good things to happen to us than bad. Optimism bias accounts for our tendency to think that our kid is the most talented student in class, our marriage is more likely to last a lifetime, and we will always be in perpetual good health. But when leaders can’t (or won’t) accept how bad a situation is, they end up planning for a scenario that’s much less severe than the one that the company is dealing with. Competition for limited resources may also lead managers to present overly optimistic forecasts of their projects. To combat this, at the start of a project, the team should imagine it has failed and give the reasons why. This exercise might feel uncomfortable, since negativity can be seen as being disloyal. In this case, though, injecting a bit of pessimism may be just what’s needed to reveal potential stumbling blocks and put success within reach.
Lead optimistically.
— Edited by Belinda Yu, an editor in McKinsey’s Atlanta office
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