Leaner, Healthier Company:

Excerpts from a conversation with

Robert Rosen, Ph.D.

by Joe Flower


This article originally appeared in The Healthcare Forum Journal, May-June 1992, Vol. 35, #3.
International Copyright 1992 Joe Flower All Rights Reserved
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For five years, psychologist Robert Rosen, Ph.D., talked to executives across America, collecting information, reviewing reams of research, trying to gather everything that is known about what makes a healthy, excellent, productive, happy, profitable company. Finally, in 1991, he and Lisa Berger published The Healthy Company: Eight Strategies to Develop People, Productivity, and Profits. The book pulled together research from the health and organizational sciences, and linked the findings to hundreds of real-life examples that together projected a new, comprehensive vision of the what the workplace of the future could be like.

His eight strategies are not based on the latest twist in technology, or some new house-of-cards style of financing, but on some pretty fundamental values, the kind of values that too often we seem to recognize everywhere but at work. The "eight strategies" are: 1) using the power of respect, 2) implimenting powerful and flexible leadership, 3) managing change, 4) developing lifetime learning within the company, 5) keeping employees healthy, 6) keeping jobs healthy jobs, 7) encouraging diversity, and 8) working in partnership with your employee's families.

Rosen's next step is even more intriguing: armed with his research and a major grant from the MacArthur Foundation, he has set up a nonprofit organization called "Healthy Companies" to try to make that vision a reality. He is building a team of nationally-recognized experts in many disciplines to undertake a multi-year project that will broaden and deepen the ideas that arose through his own research and writing. Healthy Companies plans to build a database of experiences with new concepts; build strategic alliances with other organizations focused on new business concepts; develop "collective learning partnerships" with the executives of a half dozen major multinational corporations; publish "Executive Guidebooks" and a newsletter exploring the changing relationship of employers and employees; and run a series of "leadership breakfast forums" around the country at which forward-thinking managers can compare notes and hear new ideas.

As Rosen says, "What we hope to do is to identify and understand what is healthy and unhealthy work. We're going to be looking for organizations who are leading the effort and to identify what they are doing. We will focus on looking at how healthy employees and healthy companies can work together around shared values in mutually supportive relationships inside the organization. That involves changing institutions and changing people at the same time."

Rosen is an evangelist for a way of working that he sees as both more satisfying and more profitable than the traditional fear-based hierarchy. We recently sat down with him and asked him how people could be working: what could we be doing differently?




Healthy Companies is an integrated and comprehensive approach to understanding people inside organizations, including:

Employees in this country report that they are more stressed and dissatisfied with work. They feel more alienated and shut out. Their personal values are at odds with their institutions' values. Cynicism and mistrust are at an all-time high.

Managers are experiencing the same stress, as they're pushed from above to produce more, and handicapped from below by employees who come to work without the right skills or attitudes to work.

Companies are experiencing increasing labor and benefits costs, and decreasing productivity and morale. We are having trouble competing internationally.

Two directions

There is a real problem, both human and economic, inside our work organizations. We can go two directions.

One direction I might call self interested, the "lean and mean" direction. It looks like this: our leaders become more arrogant, more controlling, and more focused on the short term. Our employees get angrier, more stressed out, and more self interested. The atmosphere gets more stressful and mistrustful, with little loyalty and lots of emphasis on covering your butt. People enter and exit as they please. Companies hire and fire at will. Many of the benefits that companies offer are perceived as entitlements and aren't responsive to the needs of people in the 90's. As a result, there are many lost opportunities, poor quality and high human capital cost.

The other direction, which I call "leaner and healthier," looks like this: Employees and employers work together. The leaders are there for the long haul. They're more empowering, they're more principle-driven. The employees are healthier, they're more accountable and responsible, and they act like adults. The atmosphere is one of commitment, loyalty and mutual interest. The relationships are fair, open and respectful. The employee and the employer manage the learning and the change together, as a partnership. The benefits are much broader. They're responsive to people's diversity, and the diversity of people's families. People recognize the importance of a healthy work environment. The result is a healthy, high-performing company.

People want to feel part of a community. People want to feel proud of what they do. People want to feel respected and trusted. They want to participate and be part of a process.

The most productive people

We are learning a lot about people as workers. The most productive people are healthy, ethical people - healthy in terms of their lifestyle, and the way they manage stress; in terms of their values, their ethics and their character development; in terms of their capacity for growth across their lifespan and how well they learn, how quickly they rebound, and whether or not they are willing to take responsibility for their behavior. Are they accountable, can they work together with other people? What kinds of relationships do they form? Are they people-sensitive and people-skilled? Can they make commitments to other people? How do they define success?

In this country for so long we Americans have defined success solely on the basis of how much money we make and how many materials we acquire. I think increasingly in the 90's it will become clear that definitions of success are broader than that - success means having a balanced life, having a good family, feeling a sense of purpose, being competent in a number of areas - technologically, the ability to think analytically, to be intuitive, to be creative.

We are learning a lot about organizational development. We are learning about what makes healthy work, work that is meaningful and safe and supported by technology. We are learning how to create learning institutions, and why it is important to create an environment where people can make mistakes, can learn and grow on the job personally and professionally - and aren't scared to death through fear-based management.

We're learning the importance of reasonable job security, and fair pay for contribution. We're learning about healthy relationships at work. And the fact that people need information. We know it's important for companies to help employees balance work and family, to be sensitive to the lives they have outside of work.

What it means to be healthy

The fields of human and organizational development are creating a vision of what it means to be healthy. Unhealthy companies beat people down. They undermine them. They depreciate the value of their human assets.

The study of healthy companies brings a number of disciplines together to think about the relationship between people and institutions in a deeper and better way. It brings together education, the health sciences, the behavioral and organizational sciences. It brings together economics and the legal system in rethinking the accounting of human assets.

Some people and some parts of companies are innovating in a number of these areas. They may not be doing all of these things, but they may be doing four or five or six things well. They're moving toward an ideal.

These things pay for themselves. Far from being expensive frills, things like compassion, ethics, balance, and the health of the work force are essential elements of success. Research has shown that some specific practices are not only good for people's health, but also good for productivity. That's how I define a healthy company practice: something good for both the company and the employee.

There are a number of examples of companies who have introduced a true participative process and significant profit sharing and/or employee ownership, and are doing better then their counterparts. The research is pretty strong there.

At the same time that we look at the employees, we are redefining what it means to be a successful leader. Our models in the past have been the man as warrior and controller, the dominant competitive individualist, the John Wayne model. The new model is much more of a team player, a leader who has a deeper understanding of people, of their own strengths and weaknesses and of the human enterprise that they run, a leader with a much greater respect for the balance between producing results and managing the process of producing results.

New model leaders

The new model leaders have a deeper awareness of the relationship between their business problems and human productivity. In fact, one of the obstacles to this new vision is the arrested development of employees and their managers - they're just unaware of the fact that their productivity problems derive from undermotivated, undercommitted people. And when they do understand that link they often lack the maturity, the confidence, or the human skills to do something about it.

Often they're scared. The pressures and the incentives inside the company are such that these people may not be rewarded. There may not be any role models in their company who articulate these very essential values. To be out front on these issues is to be a maverick in your company. Right now the companies who are out front on these issues are seen sometimes as mavericks - the Herman Millers, the Levi Strausses, the Just Desserts, and the Meridith Corporations of the world. They are seen as a little bit flaky.

Many people feel powerless in bureaucratic organizations, especially in unhealthy organizations, especially if they are not the CEO. They feel that they can't do anything to change it. And sometimes that is the case. But in my experience, most often that is not the case. If you are a manager of some type, running a department of five people, a factory of 300, or a division of 3000, you are in charge of your own workplace. There is some leeway to create your own healthy or unhealthy work environment. There is some room to innovate and do what you think is right inside institutions.

Over time, the good companies will notice those innovators, and those people will move up within the organization. There has been research out of the Center for Creative leadership that show that executives with good people skills do rise to the top. Hopefully in the 90's it will become clearer that the healthier managers and executives will be rewarded for acting that way.

Time to leave?

However, at some point an individual may need to make a decision to leave a company because their boss, or the corporate environment, is not conducive to their own growth and development. Increasingly you are seeing people, especially younger people who are not getting their needs met, leaving companies. You see it in people in their 40's and 50's, and in working mothers whose companies were not responsive to their family needs.

Some people say, "How can companies be concerned with these things during a recession when people are just trying to hold on to their jobs?" Yet these trends are going on quietly behind the scenes of the recession. The recession, although a terrible thing for people who do lose their jobs, is also an opportunity for this country. This country needs to bleed more in order to understand these issues.

We have gotten too ethnocentric, too arrogant, and too disrespectful of people who are working around us. The recession is forcing individuals and institutions to take a hard look at the way we do business in this country. My hope is that when the smoke dissipates we will come to realize that all we really have are our people and that we need to figure out how to create work environments that truly inspire them to be the best that they can be. We need their quality performance, we need their adult initiative taking, we need their responsibility, we need their creativity, we need their health, and we need the support of their families.

The recession is not unlike what happens to an individual when he or she goes through a difficult personal time in their life, whether a divorce, the death of a loved one, or the loss of a job. Basically, it's an opportunity to re-think your personal map, where you're going. Hopefully, people inside companies are also re-thinking that during the recession.

The recession forces some people to look for a different way to work - it is a catalyst for change. Large numbers of people still fall into the "Type A," stressed, insensitive mode. But other people step back from a difficult time and they say maybe we should do it differently. My hope is that the healthy organization approach is one they'll consider.

Doing more of the same?

I see a number of healthier companies that are doing what they never would have done ten years ago. Costs are tight, we're in a recession, and they are doubling their training budget. They're asking employees to share in health care costs and doubling their prevention budget. They're having to downsize a division, but going to their employees and asking them about how to do it. They're building a new factory and asking employees to have input before the blueprints are even signed off. Some companies on the verge of bankruptcy are reaching out to their employees through employee ownership plans that bring them back into financial health.

Financial ill health is forcing some companies to take a more participative approach, but not all companies. There are large numbers of companies that are just doing more of the same. When they get more stressed they get tougher and meaner and they close off communication. That may succeed in the short term, but I don't think it succeeds in the long term.

And there are still big barriers to this vision becoming an everyday reality. We have the attitude that work is supposed to be onerous, and that families are supposed to be separate from work. We have the attitude that the hard things, the day-to-day numbers, the bottom line, the land, the capital, the bricks and mortar, are more important than the people, the relationships. These values have been traditionally seen as soft.

Our accounting systems are also a barrier. We have very little calculus to measure human beings as appreciating assets that add value back into the organization. Our lawyers often times get in the way by preventing companies from even talking about such issues as stress, unhealthy work, and bad bosses for fear of litigation and liability - if you talk about them then you're acknowledging the problem, and somebody might sue you.

The swift and the slow

For a small but growing percentage of companies at the top, this is all so obvious. They have been managing this way for years. They are convinced this is the reason why they have been successful. And they continue to do it.ĘThese innovators are not necessarily the large fortune 500 companies. There are innovators in the small business arena, in the health care market, in non profits, and in the public sector. Non-profits can teach large for-profit businesses a lot about cultivating commitment around a common purpose and mission. There is learning to be done across the sectors around these issues, and each sector specializes in one or another areas.

Then there is a growing number of companies who recognize that they need to do something different and they are trying new things. They are playing around with some of these ideas.

Then there is a group of companies who have learned that by articulating these issues you are going to attract and retain the best and brightest and you're going to get good public image in the press. So they are great at talking about these issues but there is a big gap between the rhetoric and the reality.

Finally you have a large number of companies at the other end of the continuum that basically don't get it. They think it is psychobabble, they think its soft, and they don't understand how any of this relates to making money.

Even in the health care industry, I find people often feel that they can either be nurturing or survive, but not both. They are struggling on one side with what once was a core set of traditional caring values, and on the other side with the reality of their external environment in a tough, changing, dynamic marketplace. Many of the discussions that I have with top executives in health care organizations center around the search for a way to integrate of those two sets of values. They wonder whether it is possible.

From love and dimples to Attila

It is not unusual for people who have been solely caring in their management approach to throw that out totally when they feel that doesn't work anymore, and become tough, another Attila the Hun. Then they come back to some new place that integrates the two.

These are hard issues for health care organizations. It is just as hard to find that balance of tough and caring behavior from a position of being traditionally caring as it is from a position of being traditionally tough. It's just as hard to strike that balance. You have to get realistic and tough on performance. You've got to demand quality. You've got to make tough decisions around the allocation of resources. You've got to be comfortable with people being angry, and people not getting what they want, and people making sacrifices within the organization. Teaching caring people those skills is just as tough as teaching hostile, "Type-A" people to learn how to share, how to be nice, and how to be more trusting. The learning occurs in different ways in different kinds of organizations.

Re-design is important: you've got to change the structure of the systems, the policies, the practices, and the design of jobs. But re-design doesn't work alone. You can take an unhealthy person and put them in a healthy environment, and they still may be unhealthy. We have to talk about changing the way we think and the way we work. We have to talk both in terms of how we lead and manage and also how we act as employees. We have to talk about changing organizational structures and their systems, as well as about changing the way people think and relate. And I don't think you can do one without the other.

Not just icing

It has to become part of how the organization does business - business decisions are passed through a value sieve that informs the company about what kind of business decision they should make.

This isn't something you layer on top like icing on the cake. If you try to do that it doesn't work. Instead you have to create a shared vision in the organization.

Becoming a healthy company is a continuous commitment, a vision. You never get there. It's a way of doing business that never leaves you. It's extremely difficult. It not only requires the company to incorporate the concept of health into their strategic thinking at the top of the organization, it also requires employees to be responsible accountable adults.

This idea of a healthy company is lying dormant inside the hearts, imaginations, and guts of Americans. They are in search of a new way of working that allows them to own a piece of the pie; that gives them true participation; that allows their families to coexist in a healthy way with their work organization; that respects the diversity of who they are; that involves them in the process of work and change; and that supports them in learning. The real opportunity is to figure out how to tap that potential, that desire for people to work in healthier jobs and healthier companies. It's a huge resource, and you can't manipulate it. It has to be honest.

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