The Secret to better ROI

So you want better ROI

• Hell yeah!

From what activity?

• Well, everything! My change programme, the M&A I’m leading, my employees.

Ah! I see… It’s possible of course, but ….

• But what?

…you don’t know enough.

• Excuse Me!, I’ve been in business 30 years, what do you mean I don’t know enough? Who the hell do you think you are? You can’t go around saying that kind of thing to people! It’s … it’s just … you just don’t do it!

Hmmmm, it’s not common … and probably not socially acceptable, but that’s not the same as being wrong is it... If I’m wrong you’ll be able to explain the Thalamus to me.

• The what?

The Thalamus.

• What’s a Thalamus?

OK, what about the Nucleus Accumbens?

• Never heard of it?

Dopamine?

• I’ve heard of it, but what the F*** has any of this got to do with increasing ROI?

Do you employ people in your business?

• Yes!

Then it has everything to do with better ROI!

Those things, are parts of your brain and the brains of every single one of your employees.

• And?

And they can’t feature in your considerations if you haven’t heard of them!

• Why do they need to feature in my considerations exactly? You’re making no sense!

They’re all linked to issues of goal seeking, reward, motivation … and consist of electro chemical signals passing through brains as a result of everything you and everyone around you does, from thinking to frolicking… if you want a change in ROI, you need a change in the ‘SOFT skills’ behind a high performance culture, like motivation, engagement, resilience.

But, I bet you talk about these things as if they are a tangible ‘something’ and have a shared meaning, but they’re proxy terms …

• What do you mean proxy terms, proxy for what?

Proxy terms for the activity in brain areas like the Nucleus Accumbens, and the amount of Dopamine hitting opiate receptors!

We talk about people being motivated as if it’s another hard skill, because that’s all our education allows us to comprehend... but the entire subject of organisational performance is limited by the language we use; this is why we talk about bonus’ and pay rises rather than the things that really sit behind a motivated individual … real root cause of behaviour … like their thinking patterns, self-talk and the chemical mix in their heads that changes in response to the thoughts they have.

• So you’re telling me bankers aren’t motivated by a multi-million pound bonus’

I think that’s an interesting and complex psycho-socio political issue, along with footballers pay… but it’s a bit of an anomaly and a distraction from the subject in hand .. unless you pay your staff multi-million pound bonus’ or hundreds of 1000’s a week?

• Well, no, but it’s a valid point, if you’re saying a bonus structure isn’t a motivator.

It’s much more complex than that, people who get paid obscene amounts don’t necessarily have a healthy balance of positive neural chemicals in their heads or particularly positive thought patterns, so at the level I’m talking about, it’s not necessarily a motivator no, but I can see how it might look like it is … in respect to your business, I’m more concerned with the majority of people doing a 9-5, how productive and positive they are vs. how stressed they are and the impact on the economy, national productivity and the costs involved in lost hours / days due to stress etc. .. you know, the stuff that leads to your ROI and informs your organisational culture … or detracts from it.

• OK, I still think I’d be motivated if I had to put up with a footballers wages, but I’ll concede the point, it’s not applicable to everyday existence for the vast majority … so what motivates if it ain’t money?

I guess where I’m going, is toward a different level of language that allows us to talk about the real root cause of individual and thus, organisational performance. If we get rid of the spurious terms like motivation and dig a bit deeper, we can talk about the Dopaminergic mesolimbic pathway and the nucleus accumbens as part of the reward mechanism in the human brain. Then we can expand the subject and consider the psychological constructs these neural regions influence. A good example would be 4 Drive theory, which is a good account of motivation that links that loose term to the neuro-science and psychology involved, while managing to provide a simple reference model … we, that is, me and thee, could be in your board room considering these reward circuits and what makes them fire the way they do with a different level of language introduced to your team … or more accurately, we could talk about the way they don’t fire and then we could consider what we do about it as a leadership team … but you don’t have the language! I guess that’s what I meant when I said you don’t know enough.

• OK, that makes more sense now you put it like that … so what do you mean? “the way they don’t fire?”

I mean, in many, if not most socio-cultural conditions created by leaders exercising authority over a team, be it in business, sports, the classroom or the House of Commons, the individuals don’t have this language register and therefore fail to create the prevailing conditions conducive to a positive neurological or psychological response. 

• There you go again, more Neuro-bollocks! Speak straight man! If I’m hearing all your flash words properly, you mean ‘a person’ isn’t really motivated or engaged, rather, ‘motivation’ is a concept more accurately described as bits of a brain and how those bits respond to the stuff coming into ‘em, including, the boss, his or her attitude and other pressures... and the best we can do is talk about them in loose terms like motivation, engagement, autonomy, empowerment, ownership, alignment and whatever else happens to be the latest buzzword in business that can help consume a training budget.

Yes! Exactly! Kind of… it’s a lot more complex than that.

• Is it bollocks! I’ve had enough of all this namby pamby tree-hugging crap already and I’ve only been speaking to you for 3 minutes. If you want people to work harder, you pay them more. If that doesn’t work, you shout louder. If that doesn’t work, you find ways to punish them until they do!

Hmmmm, ok, a couple of things;

As we’ve just said, money isn’t, in and of itself, a motivator. The presence of Dopamine in the right parts of the brain can be considered a motivator, and the novelty of more money in the short term may act as an agent, that is, a sensory stimulus in the environment, which acts to boost dopamine levels, but the heightened level of dopamine in the brain won’t be sustained, it can’t be sustained!

In short shrift, as the dopamine rush reduces, one experiences what might be described as ‘a loss of momentary euphoria’. In that sense, money often acts as a de-motivator, it can also act negatively in other ways, provoking the release of cortisol, the primary brain chemical linked to chronic stress, where people perceive more money as more action required or more responsibility being dumped on them… usually in the form of targets imposed upon them to a large degree.

The reward circuits and goal seeking mechanisms of the brain are much more complex than your simple view of cause and effect … ‘Pay more = get more’ … most of the time, once you start looking into it in detail, is backwards. In fact, a lot of what we consider best-practice, has detrimental effects. Add in the workings of the brain and counterintuitive is a word you’ll start using a lot.

• OK, OK, I have actually seen that, people fail under pressure, when money is involved, even when little is changing around them, I get it, but …

And the second thing. What you’re describing when you talk about shouting is ‘imposed control through fear’. Specifically, the fear of failure and rejection most of us are imprinted by during our early years’ experience, specifically in our Bio-Survival, Emo-Territorial and Semantic imprinting phases, where issues of ‘threat to status’ and ‘threat to life’ are established … our brain forms in response to these things when it’s moving from 25-85% neural mass between the ages of 0 and 3, so it’s deeply imprinted from a time in our lives when our parents are exhausted, stressed and cock-up a hell of a lot in terms of ‘Good’ experience for a healthy baby brain … but that’s more to do with the neuro- psychology side of ROI and it can wait for another day.

Back to the shouty, money or otherwise subversive attitude modern man is educated to take toward leadership. With that, it’s often a mask for other deeper issues in the individual … the problem is, it leads to a ‘Blame Culture’… in a Blame Culture, the key soft-skill behind ROI, INNOVATION is massively reduced if not extinguished all together.

• I’ve just been told I can put my team on a course to learn how to become innovative, so carry on, I’m listening.

Ha! That’s funny. The way I perceive innovation, as a neural activity spanning experience over decades, I’d say it requires a different mental condition, i.e. what we’d loosely call a relaxed brain state, or in technical terms, a brain in Alpha rather than Beta brainwave patterns. What that actually means is, people (brains) innovate better when they are in a less cortisol-provoking behavioural backdrop, so it [the brain / the person] knows it’s ‘safe’ and doesn’t have to respond and defend itself… where ‘perceptions of safety / risk’ is another complex issue in its own right. 

In the more relaxed (less cortisol present) neural state, Alpha (slower) brain wave patterns can replace Beta (faster) brain wave patterns. In that state of operation, the brain does a much better job of connecting the pre-frontal cortex (conscious brain / executive function) with the deeply wired parts of our brain (i.e. our un-conscious or sub-conscious brain – to use those throw away proxy terms that we all use and fail to understand) to come up with novel solutions based on decades of past experience… there’s a lot to throw in the pot there too, like agonist / antagonist synaptic connections and the function of myelin, white matter vs. grey matter etc. etc.

• So you’re saying when we’re relaxed we think faster … or perhaps, deeper, broader, across time?

Exactly! So conversely, in a high pressure social environment, created by computer control systems, the boss’s attitude and market pressures, we see an increased release of stressor chemicals. The capacity for the brain to operate in Alpha plummets and with it goes Innovation. If people can’t think and react innovatively, they stick to what they know (as part of their defence mechanisms)… so as a leader, you could say, your low or negative ROI, is a result of the reaction to change that are provoked in people as a result of the conditions you’ve chosen to create.

Putting a human brain in a defensive state, increasing the levels of stressor hormone presence etc. we reduce the rate of neurogenesis (neural adaption to stimuli), and thus the rate of adoption of new tools and practices... which means change takes longer, costs more and undermines your ROI … and there’s your link to your ‘Change Programmes’, like IT implementation and ‘Lean’ tools and techniques … despite popular opinion to the contrary, organisational change is 80% people, because any ‘Change’ is ultimately a change in neural wiring and firing patterns in brains as a result of the socio-psychological and physical stimulus coming into those brains from the prevailing ‘control’ conditions created by leaders… which leads us into issues of internal vs. external locus of control and learned helplessness. That only leaves 20% of change coming down to the utilisation of defined processes, yet the world has been selling you on ROI from the hard skills and ignoring the people piece for decades!

• That’s true. It really is, I can see that, I’ve never heard anyone talk about people like this and I don’t know all the words you’re using, but it seems to make sense. In the IT project we did a few years back, the people piece was neatly addressed by the OCM (Organisational Change Management) part of the project management play-book. All the stuff you’re talking about got a couple of pages out of a 1000, it kinda realised it was shallow then, but, accepting what you’re saying, I can now see it was shallow in the extreme! It actually said at one point, “don’t let the people get in the way of change”

It didn’t?

• It did … in black and white! About page 7 if I remember correctly … I’m embarrassed to admit I thought that was a great sentence when I read it!

Wow!

Did you read that before you started the project or some way in?

• It was about 3 months before we got to see that in the Project Management play-book.

So, your employees were in the dark, or finding out about a big change coming at them for 3 months, before you even realised there was a communications piece in the PM play-book? And do you think finding themselves in that position might have been a trigger for stressor homones in their system?

• Yes … yeah … shit!

Hmmm … anyway, I interrupted, you were saying …

• Yeah … It then went on to detail the documents you have to have in place by a certain time to tick a box on the critical path, like, “by December 22nd, have the communications charter approved by 5 senior managers” … the communications charter … what a joke, it was a bit of paper put in place to tick a box, no-one read it or believed in it, people just did what they always do.
• Shit! At that point, given what you’re saying, we’d already been increasing stress by ‘communicating’ for 3 months through our actions, bringing in a team of 100 contractors to introduce a new system none of the people who used it had any say in defining … we brought in experts … a good move on the face of it, but based on what you’re saying, we needed a deeper approach embedded in our team so it actually made a difference to the way leaders led, before any IT consultant even stepped foot on our property!

Now you’re getting it.

• That OCM approach certainly didn’t address the people issues as you’re describing them! In fact, it did the opposite, my team were forced by the pressure I advocated to hit deadlines, even the kick off meeting was a joke now I look at it through this lens! We were actively encouraged not to put any effort into understanding people … we allowed the project manager to steam-roller through the place with multiple external agents … Target Operating Model people and other analysts from expensive consulting groups … and they were all pulling in different directions and damaging the capacity to adapt in my people from the start… I had no idea, how could I? None of this has ever been put on my radar before!
• If this level of understanding is available, why the hell hasn’t it been in all the training courses me and my team have been to?

The honest answer... it doesn’t sell, because the market doesn’t have the language and psychologically, anything new is a threat, which provokes defence mechanisms. Try selling knowledge about brain science to a hairy arsed MD and you don’t get far. Trust me I’ve tried.

Like I said a minute ago, leaders, even big IT System project managers, don’t have the knowledge or vocabulary required to really understand what sits behind a decent and sustainable ROI … and you can’t have this conversation with them … they’re only human and react the same to any perceived threat as anyone else does, defensively… the irony is, it’s knowing more about their emotional responses and the impact of their defence mechanisms on the bottom line they purport to want to improve, that they’re defending against.

• Wow! That’s scary … like we’re destined to remain locked into a way of thinking that is fundamentally flawed … like those IT PM’s and consulting companies … None of them had change in people as their primary or central focus through brain language … they certainly were NOT looking at themselves or how they were provoking defences in others, they were there as experts to do what they do! They were there to sell us on the hardware. Shit! We got it wrong before we even started … my workforce must have wondered what the hell they were having dropped on them. I created the conditions in which they were stressed, shut-down and unable to feel valued or innovate. And then I shouted even louder because it all went over time, over budget and didn’t deliver what was promised in terms of efficiency or effectiveness

That’s quite normal… it’s also because it’s ‘New’ and therefore (psychologically) a threat … that’s where resistance to change comes home to roost and your project time-lines extend incurring cost… reducing ROI.

• But you know what! The project milestones were all signed off! Fooling us into thinking it was working. Wow! It’s scary how much we missed. Shit!

Hey, don’t beat yourself up too much, this is de facto stuff; Neuroscience only really took off after Elizabeth Gould identified NeuroGenesis in the adult human brain in 2009, it’s early days yet… it takes a while for a new way of thinking to overcome the beliefs of the past. Project management methods aren’t up to speed yet, but they’ve been the best we’ve had until now

• But it’s so important to build this into our approach, anyone can see that!

HA! You’d be surprised. Few people can emotionally overcome their current conditions and expand their thinking in this direction. It poses a threat to the pre-conceived ideas indoctrinated around the subject of making money, so most say they get it in conversations like this, but few, if any, do anything about it. The world keeps on keeping on. You’ll probably do the same to be honest … you have a lot of years-experience forming the wiring and firing patterns in your head … one conversation isn’t going to be enough to suddenly map a new view of the world … you’ll ponder, life will carry on, you’ll forget and find yourself doing all the same things as you do today in a years’ time, because your brain won’t change with only this level of stimulus.

But back to the project you just mentioned, and other change initiatives, like Lean etc. the sad thing is, the people involved learn their opinion isn’t of any importance, because their boss, or experts, always know best, or worse, ‘The System’ doesn’t allow them to have a voice.

Then, a socio-psychological condition called learned helplessness sets in… people stop trying, stop thinking, feel shut down, depressed… and then you shout at them to ‘Get on-board with the new Continuous Improvement project … IT System … what have you’, because you went to a Seminar and from now on, “that’s the way we’re going to do things around here!”

• Yeah! when you put it like that, that’s me all over… it’s a difficult language register, but it does all strangely make sense, even when you don’t really know the words being used, but it’s all so obvious once you start thinking like this.

Yeah, I hear that a lot. It’s like Wittgenstein said …

• Wittgen who?

Stein … he’s a philosopher.

• So you want me speaking philosophy, psychology and neuroscience?

It helps.

• Shit! Really! I was joking… damn … what did he say?

He said “The limit of my language is the limit of my world” … he had a point.

• He certainly did!
• As you talk, I’m getting little light bulb moments of realisation. I see people shutting down, giving up or shouting all the time in my business; but there’s only so much anyone can do in a 14 hour day. At the end of it all, if people are insecure and lacking the balls to shout back, that’s their problem, they need to get a grip, not have a namby-pamby boss who wants to wrap them in cotton wool!

OK, a couple more things, 1. in a couple of your responses in this conversation, you’ve pretty much said ‘Yeah, But…” which is a bit of language common to people in the ‘Denial and Resistance’ phase of responding to anything new … and then you’ve slipped into language that constitutes blame and projection when you belittle others.

• No I didn’t! Did I?

You did, using the phrase ‘That’s their problem’ backed up with the belittling term ‘Namby Pamby’, you’re in the realms of justification and association, allowing you to blame, which is the same in reverse, as failing to take responsibility… you’re projecting the problem onto others when, as the boss, the buck, as they say, stops with you. It’s your attitude … that attitude … that belief, a belief formed through the lens of capitalism, democracy, an education system that filters people through siloes and Keynesian economics which influences your wiring and firing patterns in your head, which determines your actions and the reactions of others to you.

That’s also an aspect of the psychological side of leading by example, and leading change, that you and your extended team need to have in mind (if you’ll pardon the pun) … if you want to lead change more effectively and efficiently … i.e. to improve ROI … people have what are known as ‘Mirror neurons’ and they help with issues of empathy and reflecting another’s emotional state … or psychological maturity … if you’re blaming, they ‘mirror’ your actions and blame as well… how do you think we ended up with phrases like ‘a blame culture’?

• Shit!

And 2. You have to create the conditions in which people can have a voice. If you command and control through fear, you can’t sensibly expect people to stand up to you. You’re the boss; they could lose their job and they have bills to pay. That’s the power game people play, especially in corporate life. You can’t have it all ways... you can’t take a command position in your own behaviours and elicit an autonomous response in others … it’s simple transactional analysis really, just on a social scale.

• I’ll take your word for that, transactional what? Lol … but I get what you’re saying, my leadership style … my behaviours will determine results.

Actually, your behaviour is just an outward expression of your brain activity. It starts with your beliefs. What you’ve fundamentally been imprinted to consider ‘Good’, i.e. what you believe to be good for results, will determine your every thought, word and deed. If you believe a working knowledge about the workings of the brain will give you a competitive advantage, you’ll find out more and adopt it into your thinking and language register. If you don’t, you won’t.

Then there’s the issue of a self-fulfilling prophecy, which takes in issues of assumption and how it provokes a response in others, usually confirming your assumption ... an aspect of this is called ‘Collusion’ … psychologically we keep each other in the place in our heads that we’ve assumed we have to be when interacting with others … and it stops us challenging each other … it’s another aspect of what we just said about people not shouting back at a shouty boss … it’s some of the science and technical jargon behind old sayings like “Effective communication is the response you get back”.

• OK, I’m listening. I’ll stop saying Yeah but and justifying my own position on this stuff.

Swap it for ‘Yes, And’ … so you’re expanding on a subject rather than shutting it down to your own world view. It’s funny, these things are small, but our culture in organisations pivots on the language we use … or more accurately, the psychological inference behind simple terms… if you change the language of leaders, through education of broader issues, you illicit more sustainable positive change than ever … and you’ll get people to adopt new practices faster, and innovate, because you’ll create the right conditions for the brains at work.

• Lol OK … Yes … I’m interested … and… just how good is all this stuff in practice? What’s the benefit of understanding more about people and the language behind culture then? What’s in it to attract me to the idea of learning a new language? Surely it has to translate to the bottom line at some point?

Well, there are any number of studies out there, but perhaps the best is Kotter and Heskett’s which, studied 207 companies in 22 industries over 11 years and stated “companies that managed their cultures well saw revenue increases of 682% versus 166% for the companies that did not manage their cultures well; stock price increases of 901% versus 74%; and net income increases of 756% versus 1%.

Is that enough for you?

• They’re just ridiculous numbers, how can anyone talk about 100’s of percent increases in established businesses? They must have been start-ups.

There go your defence mechanisms again, why deny the possibility rather than explore the potential? That almost sounded like, ‘Yeah, but … there must have been something different about them’ … which would allow you to project blame onto some indiscriminate thing (a non-descript difference) and allow your world view to remain in-tact … you asked me what the benefits were, then rejected them out of hand … don’t you find that odd?

• Damn it, you're annoying.

I hear that a lot too.

• So people really don’t see the connection between ROI and all this brain science and psycho-bollocks.

Lol, no they don’t … and it’s because they use terms like that for it, rather than seriously considering it as the pivot point for culture, strategy and change.

You don’t have to move a muscle to improve ROI … you just have to move your mind.

• What a load of softy nonsense, you’ll have me hugging a tree next and talking about Karma. J

I’m pleased you’re joking … but unfortunately, the worlds of psycho-therapy and self-help have sold us a pup there, it does sound like ego-stroking bollocks, I’ll give you that, the marketing surrounding this subject has been structured to make sales to individuals facing personal issues rather than CEO’s, but there’s a deadly serious side to all this … I’m not talking about mantra’s and sitting in circles, I’m talking about the very real science of Neurogenesis and how long, in what conditions, the adult mammalian brain takes to re-form to reflect choices, thoughts, emotions, new information and new principles of operation, personally and in respect to adopting a new (scary) process and procedure … and how this can be considered by leaders looking to get a competitive advantage integrated into their culture.

• OK, you got me … can you come in and help me change the language I use … we use, around the business?

It’d be my pleasure, and once I introduce your team to the basics, you'll quickly see how and why the application of Yoji Akao's Hoshin Kanri method has been the real advantage at Toyota and not the tools promoted to the market.

How are you fixed for time next month?

FOOTNOTE

There is an argument that says the language surrounding the neuroscience and psychology of change, culture and organisational performance improvement, is too complex and it needs to be kept simple. I agree in some respects and not others. I agree that language which doesn't pose a threat to Ego or Status is more readily adopted, and therefore is easier to sell / buy ... however, I also recognise that many 'simple' versions of complex subjects actually misinform leaders and damage progress, for the benefit of the seller and not the buyer. In the long run, operating in our own self interest and not for the benefit of others isn't good for brain health. It's for this reason, I've been promoting this level of language for the last 10-15 years. I hope one day it will be the norm, not just in business, but also in education, parenting, politics and all walks of life.