6 Ways a Toxic Work Environment Hinders Your Business’ Success

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Everywhere you look, organizations are facing a crisis that’s causing productivity to plummet. In fact, this crisis is having a profoundly negative impact on the bottom line of businesses in every industry.

What is this “silent killer?” Toxic work environments.

Far from just being a Human Resources issue, dysfunction in the workplace leads to a host of problems, each of which can hinder your business’ success. From lower productivity to avoidance of change, the following six outcomes—all of which stem from toxicity in the workplace—reduce your organization’s ability to grow, scale, and evolve.

#1: Lower Productivity

A toxic environment makes people insecure. When employees are insecure, their anxiety reduces their ability to focus on their work and increases procrastination and avoidance. Anxiety distracts us so work tasks take longer to complete, and productivity drops.

#2: Lack of Innovation

If employees are fearful, they will be avoidant of change and less likely to take risks or share their thoughts.  As a result, the generation of new ideas for innovative products or process improvements will be lower. On the other hand, when employees feel safe, they’re more likely to take risks. They have confidence that they will succeed and overcome any challenges. 

#3: Limited Succession Planning

An organization that doesn’t create a secure environment will face challenges with succession planning. Those who logically should be internal candidates may be nervous about accepting promotions. Additionally, in a toxic workplace, employees may not be willing to risk the blame or humiliation that could come if they fail or make mistakes—both of which are natural parts of learning and growth. As a result, they may avoid taking on new challenges that would prepare them for advancement. 

#4: Reduced Collaboration

Great business decisions emerge from discussions that engage all stakeholders. However, when work environments are toxic, collaboration is inhibited. Insecure employees become fearful of sharing their thoughts, plans and opinions with others. This can limit the success of change initiatives, which require collaboration for buy-in.

#5: Lost Opportunities

For businesses to succeed, employees have to recognize opportunities and have the confidence to take advantage of them. In a toxic workplace, employees will have a heightened  negativity bias. This bias makes it difficult to see opportunities as the brain is too focused on the risks. If employees do see the opportunities, the repercussions of failure in the toxic environment may make them too fearful to capitalize on them. 

#6: Reduced Awareness of Organizational Issues

In an unhealthy workplace, employees are less likely to share information with their managers and are more likely to omit or even lie about information that they feel may cause them harm. And in this environment, leaders may be avoidant, if only on a subconscious level, of seeing and hearing negative information. The combination of these factors may blind leaders to issues within an organization until it’s too late to make adjustments and the detrimental effects have already occurred.

This article was adapted from the book Detox: Managing Insecurity in the Workplace, written by Melanie Pump. Melanie, who is the Chief Financial Officer of Brane Capital, has spent more than twenty years studying the impact leaders and workplace cultures have on employee security and performance.

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