Management by Fear is Not a Successful Strategy in Business

Business managers and other leaders of people hold great power over many individuals and some are in a positions where they have near absolute authority. Some of these people, way too many, believe fear is a useful tool when it comes to business management, and some even believe fear is a necessary component of business success. The temptation to use fear as a motivator is high. First, it is relatively easy. When you have power over other people, especially when that power directly impacts their ability to provide food for their families, pay their bills, etc., the easiest thing you can do is scare them. Simply imply their jobs are on the line either implicitly or explicitly and watch profits soar as formerly slacker employees suddenly become energized go getters putting in 12h days and crushing all their performance objectives. Or, so the thinking goes among the fear management true believers. This thinking is wildly incorrect, and management by fear never leads to successful outcomes in the long term. It is guaranteed to fail, and to fail every single time. It may appear effective in the short or even medium term, but the appearance of effectiveness is not the same thing as effectiveness. Unfortunately, despite endless lip service to the virtues of long term business strategy the vast majority of senior business leadership are short to medium term thinkers, thus they are easily tempted by fear.

Why exactly is management by fear such a counterproductive approach to business management? Below I discuss just some of the reasons.

Management by fear leads to error/mistake cover ups

To have a successful and healthy business it is imperative that employees feel empowered to report when they are responsible for an error or other mistake that has happened. Reporting errors and mistakes is the only way to learn from them, correct them in a timely manner, and put in place systems to prevent them from happening again. It is obvious I think that hiding or errors can lead to disaster as they may be simply patched over/not fixed properly or worse yet not fixed at all. Certainly the idea of preventing the same mistakes from happening again by learning from them is ruled out. There is a reason that root cause analysis and the implementation of corrective/preventative actions is a cornerstone of business quality systems. That process cannot happen, or at least cannot be effective, if people are too scared to be honest about mistakes.

Management by fear leads to blame shifting

This and the above go hand in hand, and if employees do not feel capable of reporting when they have made a mistake they will more likely try to shift the blame to someone else. This leads to all sorts of terrible consequences such as personal enmity, destruction of team cohesion/unity, and generates a general climate of distrust of others. Winning teams are built on a foundation of respect and trust and blame shifting destroys trust and actively erodes respect.

Management by fear leads to sandbagging

Why should an employee work as hard as they possibly can for a boss they fear may discipline them for the smallest of mistakes? Much better to set expectations at something less than 100% so they are certain to always meet or exceed their goals. There is a risk in stretching one’s abilities and risk taking is not something anyone will do willingly in an organization that is managed by fear. This leads to the next point.

Management by fear cripples innovation

Innovation requires risk taking. Risk taking requires that one be willing to fail. If failure is actively punished why would anyone want to take any risks at all? They would not, and thus management by fear fosters an environment in which risk taking happens rarely or never, thus innovation rarely or never happens.

Management by fear leads to more worker absences

This one is patently obvious but if people are unhappy at work they are much more likely to be absent from it. There is a direct relationship between job satisfaction and worker absences. As satisfaction goes down absences go up and vice versa.

Management by fear in any one part of a company can and almost certainly will, have negative consequences for all parts of the company

All of the above negative consequences of management by fear can metastasize like a cancer and move to other parts of the organization. If those other parts have strong management and happy people they may be able to fight off the infection and be minimally or completely unaffected, however if management is weak or worse yet also fostering a fearful environment those negative consequences will be amplified and spread even further. In very large (global) organizations when leadership by fear is practiced by top leadership, it is sometimes possible for parts of the organization to be shielded by factors like geography or by sheer numbers. In many large global organizations management of each global region is totally isolated from management in the other regions and from central leadership, at least to a degree. If good people run those regions they can sometimes hold back the tide of fear or, if they are lucky, avoid it altogether. However, it can't and won't last forever. It is the nature of leadership by fear to spread from the top down, in addition to side to side. Leadership by fear in any part of an organization, be it small or large, will always eventually spread if it is not caught and immediately stopped. It is imperative that leaders everywhere in any size or type of organization be always on the lookout for the use of fear based management tactics and immediately put a stop to them by whatever means necessary, up to and including termination of the individuals involved. Stopping fear requires vigilance, determination, and courage, but it can, and should be the goal of every success oriented, right thinking company, and company leader