Leading from Joy vs. Leading from Fear

How to Demoralize People When You are Aiming to do the Opposite

It was January of 2010. Our team came back after the holidays excited to get started. Right away we were under tremendous pressure. We had just raised our Series A sixty days earlier and we were already off track. Later, a VC friend joked to me that all companies have a bad first board meeting after their Series A, when the venture investors who backed the company realize that the assumptions in the model were rooted in hope rather than reality.

It wasn’t funny at the time.

Riddled with stress, burning the Series A capital way too fast, and flummoxed by a number of challenging personnel situations, I was at a loss. Worse still, we had a culture where some people were working harder than others. I knew that regardless of what path we chose, we all had to be pulling together and working our tails off. I struggled with what to do to inspire that outcome.

Then a brilliant idea hit me.

I would get up in front of the group to salute those who had worked their tails off for the company and who were no longer with us, including our cofounder and a handful of early employees.. I’d also provide perspective on how good our lives were compared to others in the world, how fortunate we were to be doing this work, and get everyone pumped up on how we all had to work harder together. By showing how much we need to respect those who had invested both time and capital in the company, and reflecting on how lucky we were building a startup in New York City, we would all be motivated to dig in deeper.

By providing these reminders, the goal was to instill an element of productive fear about what failure would look like and how it would feel. How can we let the people down who came before us? How can we let our investors down? How can we let ourselves down? We need to fear oblivion to succeed. The speech was inspired by one of the executives who reported to me who would complain to me about the lack of “respect” in the troops for me and for what we were doing. He urged me to do something about it.

The presentation was called “23.” Drawing from my roots as a passionate Chicago sports fan, I contrasted the Hall of Fame speeches of two of my favorite players who had donned that number: Chicago Cubs second baseman Ryne Sandberg and Chicago Bulls shooting guard Michael Jordan.

Sandberg’s speech is a thing of beauty. It’s about how he had too much respect for the game to ever do anything but run out the trip to first base. Whether you are a sports fan or not, it is a truly remarkable speech and it is worth a listen, or a read. It ends like this:

I dreamed of this as a child but I had too much respect for baseball to think this was ever possible. I believe it is because I had so much respect for the game and respect for getting the most out of my ability that I stand here today. I hope others in the future will know this feeling for the same reason: Respect for the game of baseball. When we all played it, it was mandatory. It’s something I hope we will one day see again. Thank you, and go Cubs.

Sandberg’s speech hit the nail on the head. I thought our team didn’t holistically have enough respect for what we were doing to give it their all. I was working 24/7 — including on the weekends — and some others were, too; but most were not. I was terrified we’d go out of business, and people who loved their jobs seemed to take it for granted that the company even existed. Frustratingly, some of our most highly paid employees were working the least. As 5pm would hit, they’d be out the door. You could feel the energy sucked out of the room for those staying on till midnight, folks who’d worked twelve hours on their day jobs before switching to fulfilling orders after dinner.

Who is to opine on the schedule that is kept by those who have families? Who is to opine on the fact that few of us had families at the time? Who can comment on the schedule that is kept by those who are working less so that they can be having more fun? Who can solve the challenges of unfairness that are felt by some doing more than others, and who can stomach the cultural malaise when those who are working less are also not delivering?

Such answers are elusive. They definitely eluded me at the time. All I knew to do was to try to get more out of people and the speech seemed like a potential watershed.

Excitement built the morning of the presentation. Twenty five people gathered round. I delivered the speech. It included a photo of a woman pulling rice from the ground from a backpacking trip I took to Burma, to draw out how lucky we were to be building a startup in NYC versus toiling in a muddy field. I showed photos of my co-founder and early employees, admonishing the crowd: Would we want to let them down? When the speech closed, people turned away and headed to their desks, dejected. Only the leader who had suggested it clapped. Within two days, two of the people at the company came to me to quit.

It had gone terribly.

What happened?

Rather than feeling inspired to work more, people felt looked down upon. Rather than being energized and creating a sense of possibility, what landed from the speech the implication that the team was complicit in setting the company up for failure. Rather than creating a spirit of teamwork, it fomented the suscipicion that some employees were perceived to be working harder than others and were more favored citizens of the company, ultimately disrupting and eroding trust. Rather than getting everyone to row together, it sewed more divisiveness. Rather than feeling recognized, people felt overlooked and under-appreciated. Yes, I succeeded at instilling a fear of failure, but also the dejection and disappointment that comes with it. It was not a catalyst for action and motivation, but rather the opposite.

As I did the post mortem on what happened, I realized I was making four huge mistakes as a leader.

1. Other people are not motivated by the same things you are. While the founding CEO of the company obsesses about running out of cash, your employees don’t. They expect you to take care of that, which is why you are the CEO. It’s your job. While stress and anxiety can be helpful to bring out the best in a CEO, and perhaps other senior leaders, it’s not motivating for the troops. Instead, it makes them afraid and they wonder if they should look for a new job. The company is not their cross to bear, it’s their place to work.
2. Don’t criticize people. Instead, celebrate the people who are doing the best work and others will yearn for and lean into that sunlight. In Little Bets, Peter Sims talks about the culture of plussing at Pixar. The idea is to only point out the positive and ignore the negative. They use the word ‘and’, never ‘but’. As Jedi Joel always said, you catch more flies with honey. Feedback creates a sense of opportunity to get better; criticism creates shame and is experienced as castigation for not being better to begin with. In my limited experience, it’s best when feedback observes the John Gottman principle of the magical relationship ratio, 5:1 positive to constructive.
3. Model gratitude. If you want people to work harder, don’t look down on them. Show them your gratitude towards what you do by modeling gratitude towards them. Create a culture of equals where people want to love their coworkers and belong to something great, rather than a tale of two cities with favorites and wannabes. Why would your employees respect you when do you don’t respect all of them?
4. It’s all your fault. At the end of the day, remember your job as a leader is to inspire people. If you fail to do so, it’s not their fault; it’s yours. You have to figure out how to create culture. It’s in your control. Painful self-investigation into why you suck at motivating people is required, and blame for that needs to be internalized, not externalized, on other people.

Ultimately, inspiring people comes from joy, not fear. Some of my foundational experiences come from consulting and finance, where it’s about who can outwork others and get promoted. In the fashion industry, it’s typical for leaders to berate their employees. It’s owners versus workers. CEOs are proprietors, not stewards. Proprietorship — where there is one owner and everyone else is “labor” — is the wrong mode At great companies, everyone takes an ownership mentality. Everyone has equity. In the stewardship model, the leader serves the team rather than the other way around. The leader is at the bottom of the org chart, not the top. People feel free to fail, because by risking failure they can experiment their way into a brighter future. The feeling in the halls is one of optimism and joy, not dejection and worry.

The beautiful part is this: if you get it right, people will love what they do. They will feel valued and celebrated. They will have fulfilling personal lives as well, and feel that the company values the human being behind the professional. They will find balance, even if you don’t. That’s why CEOs get paid the most. Entrepreneurs and CEOs make too much money anyway, so we had better earn it.

Leading from fear is the easy route. Leading from joy is pure magic. When you realize your job is to show up and love your job, to project pure positivity even on one your worst days, to love the people that work for you, you might find that even during difficult times, you start enjoying it more too.