Today we are lead into Chapter 5 in Carol Dweck’s Mindset: The New Psychology of Success (buy your copy and read along). In Chapter 5, we explore the impact of mindsets in the business environment. The impact of mindsets can be seen in positive and negative business outcomes. Dweck begins this section with a focus on the negative impact of the fixed mindset at the C level in business.
One of the primary examples used in Chapter 5 is Enron. Enron, (watch the movie Enron: The Smartest Guys in the Room for background) represents one of most egregious examples of excess, corruption and the impact of leaders of the modern age. Some, if not a majority, of the poor behavior described can be ascribed to the fixed mindset, both individually and collectively. The fixed mindset culture of an organization creates an environment in which employees are forced to look and act extraordinarily talented rather than focusing on outcomes. In organizations with fixed mindset, people protect their egos and how they perceived rather than learning from any potential bump in the road. A quote that illustrates Jeffrey Skilling’s fixed mindset drives the point home, “my genius not only defines and validates me. It defines and validates the company. It is what creates value. My genius is profit.” In Skilling’s mind, he was more important than the business. Dweck also uses the example of Lee Iacocca as the big fish that that would only tolerate helper fish around him. For example, Iacocca used saving Chrysler recover his ego but then was not able to stop burnishing his ego, which nearly lead to nearly destroying Chrysler when things got difficult a second time around. None of those around Iacocca were able to shift his focus back to the organization rather than his reputation, and the board had to finally force him out. Iacocca, like Skilling at Enron, is an example of someone who makes decisions based on their own good rather than the good of the organization
Jim Collins, author of Good to Great found that organizations that were continuously trying to improve performance through learning and were self-effacing about their progress prospered. These attributes are a reflection of a growth mindset at the organizational level. One of the reasons organizations with a growth mindset prosper is that leaders with a growth mindset usually surround themselves with great teams rather than having to be the big fish with helpers.
Another negative outcome of a fixed mindset is brutal managers. Brutal managers (I chose not to use the word leader) believe that the needs or feelings of others can be ignored. A fixed mindset allows brutal managers to dehumanize those they manage.
Another danger for organizations (or teams) that are affected by a fixed mindset is groupthink. It is an affliction where no one will criticize or provide outside information to the leader. This form of fixed-mindset groupthink needs to find some mechanism to bring in other information so that you don’t fall prey to thinking within a bubble.
On the other hand, growth-oriented leaders peruse a journey of learning. Dweck’s examples of growth mindset oriented leaders include:
- Jack Walsh, GE, was devoted to the concepts of team and growth. Walsh is not my favorite example because of concepts like cutting the bottom 10% yield negative behaviors. However, this does not reflect a mindset issue.
- Lou Gerstner, IBM, opened lines of communication, attacked elitism, accepted that everyone has a lot to offer and focused on customers.
- Anne Mulcahy, Xerox, reshaped the company to believe in growth even though it required cutting and suffering. Mulcahy worried about the morale and development of her people.
In each case, the growth mindset CEO helped to lead their companies from near failures to highly innovative growth phases.
The chapter concludes with a set of questions and activities that help grow your mind. For instance: Reflect on whether your workplace promotes groupthink while eschewing information that might challenge the status quo.
Organizational Transformation: The prevailing organizational mindset, generally set by senior leaders will directly affect how and why change is introduced into an organization. When helping to introduce change into an organization lead by someone with a fixed mindset, the change has to be perceived to burnish the leader’s ego and has to fix the leader’s world view. This does not sound like a huge amount of fun; however, the knowledge of mindsets is an effective tool to help introduce change or to challenge groupthink.
Team Coaching: The most valuable takeaway for a team-level coach is the added ability to recognize mindsets based on the impact they have on the team. In addition, helping teams understand the mindsets around them is also useful for helping the team understand the possible considerations and consequences of changes they attempt.
Previous Entries of the re-read of Mindset:
- Basics and Introduction
- Chapter 1: Mindsets
- Chapter 2: Inside the Mindsets
- Chapter 3: The Truth About Ability and Accomplishment
- Chapter 4: Sports: The Mindset of a Champion