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Psychological Safety and Taking the Right Kinds of Risks

7 November 2023

This week Geof read Amy Edmondson’s The Fearless Organization: Creating Psychological Safety in the Workplace for Learning, Innovation, and Growth, an overview of psychological safety as well as a common-sense framework for leaders to encourage an environment in which employees are comfortable expressing and being themselves.

Tags: geof read, leadership

The Layer of Clay

Years ago, I worked for a small business innovation consulting company based in Richmond, Virginia. We were fortunate enough to have a roster of client’s way above our weight class, including one of the big US automakers. We were invited to Detroit to pitch for a piece of culture transformation work, meeting with the Global Vice President of Human Resources. During our meeting he described a lack of candid communication between the “front line employees” and the leadership. He continued to describe, in general terms, a “layer of clay” at the middle management level that had “become very sophisticated at sanitizing information up the ladder to senior leaders.” This sanitizing of information severely limited leadership’s ability to develop a feasible strategy. Leadership was instead building a strategy on inaccurate information, essentially building a strategy for a company that did not exist outside of the story told by middle management.

In her book The Fearless Organization, Amy Edmondson would describe the “layer of clay” as an organization that lacked psychological safety. A culture that, for whatever reason, created a belief that speaking up could be a career limiting behavior. That belief is an important distinction. The senior leaders at this automaker were eager for accurate information. However, there was a belief, not necessarily an action, that created a fear of sharing accurate but negative information.

Defining Psychological Safety

According to Edmondson, psychological safety is “the belief that one will not be punished or humiliated for speaking up with ideas, questions, concerns, or mistakes. It is a shared belief that the team is safe for interpersonal risk-taking.” In other words, it is a business climate in which employees are comfortable both expressing and being themselves.

The Right Kinds of Risks and Failures

Psychological safety is important because it is a key factor in creating a healthy work environment that fosters creativity, innovation, and growth. When employees feel safe to speak up, they are more likely to share their ideas, ask questions, and provide feedback. This leads to better decision-making, improved performance, and increased productivity.

Edmondson introduces three types of failure to help leaders create an environment in which employees feel safe taking risks. This for me was the most valuable lesson of the book and provides the conditions under which to foster an environment for risk taking for innovations sake, as well as when not to tolerate risk taking.

  • Preventable Failures: These are deviations from processes that produce negative outcomes and are often the result of behavioral or skill failings. Think of these as the unwanted risks employees take as short cuts, such as funny accounting, short cuts in safety measures, or less than above-board hiring practices. They have the potential to end in terrible, yet preventable, outcomes. Preventable failures are not included in the realm of psychological safety in that employees should not be permitted to take risks in established processes designed to minimize failures.
  • Complex Failures: These are systems failures that occur during unpredictable combinations of events and circumstances that lead to unwanted outcomes. These are when our normal systems or ways of working break down because of volatile, unpredictable, complex, and ambiguous conditions. Think of these as the unwanted headwinds an organization might encounter, such as a global pandemic, civil unrest, or a weakening economy. These situations require new, novel, and untested (read risky) solutions. An environment of psychological safety will encourage employees to share ideas or solutions to complex problems without fear of punishment or humiliation.
  • Intelligent Failures: These are ventures into new business territories and growth strategies. These require experimentation and iteration to reduce uncertainty. Think of these as the new product launches, new service offerings, new social innovations. These situations require trial, iteration, and prototyping – both successful and unsuccessful. An environment of psychological safety will encourage employees to treat unsuccessful trials not as failures, but as successful learning opportunities filled with valuable insights on how to iterate and improve.

The Leaders Toolkit for Psychological Safety

Edmondson outlines a “leader’s toolkit” to help foster a culture of psychological safety. The toolkit, or framework is organized into three categories:

  • Setting the Stage: Leaders can work to create shared expectations among the team, and clearly outline the team’s purpose and goals. Leaders do this by “framing the work” and clearly setting expectations about success and failure and clarifying the need for candid and transparent input from everyone. Leaders should also identify what’s at stake for the team.
  • Inviting Participation: Leaders can constantly and consistently invite share of voice and participation from everyone with important and relevant information to share. Leaders do this by “practicing inquiry,” and asking open-ended questions that invite input, and listen intensely to responses. (There is a great story in the book around hospital and patient safety in which the leader asks the patient care staff, “Was everything as safe as you would have liked to have been this week with your patients?” and “What do we need to create a work environment of care and respect?”)
  • Responding Productively: Leaders can orient the team to a mindset of continuous learning and uncovering insights that reduces risk and failure. Leaders can do this by “destigmatizing failure” AND “sanctioning clear violations.” Destigmatizing failure is especially important when faced with complex and intelligent failures in which the leader and organization need candid, accurate information to help guide decisions.

Through the Layer of Clay

Leaders can help create an environment of transparent candor that is comfortable sharing accurate (good and bad) information that can guide an organization to make decisions based on accurate and timely information. Psychological safety is an important factor in creating such an organization capable of addressing complex and intelligent failures by creating a work environment that fosters creativity, innovation, and growth that dissolves the layer of clay described by my former client.


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