Newsflash: In Business, Healthy Beats Smart

Healthy companies win. This is not, however, an article about wellness or work-life balance, as important as those things are. This is about the health of the organization itself, not necessarily the people in it.

Patrick Lencioni, the consultant and author who brought us “The Five Dysfunctions of a Team” recently published “The Advantage,” which has a simple message – larger, well known companies thought to be run by very smart people often get beaten by smaller rivals who posses traits which he described as critical to organizational health.

In healthy organizations, the leadership team is cohesive and works well together. They are clear regarding strategy, direction and values, and they communicate their clarity to everyone in the organization. The leaders are humble and approachable which creates an environment where there is open and often passionate discussion. This ensures that ideas and solutions are put on the table, thoroughly hashed out, and the best are chosen. When implementation begins, everyone is on board and focused on the same goal.

According to Lencioni, the companies he calls “humble underdogs” beat their larger competitors because they didn’t allow dysfunction, ego and politics to take root and derail progress. In the less successful organizations, leaders who prided themselves on their expertise and knowledge weren’t open to learning from their own people. They also weren’t willing to admit their mistakes, which blocked progress and fueled political infighting.

When the leadership team has an open and healthy dynamic, the results flow through the entire organization. People naturally take their cue from those at the top and conduct themselves accordingly. Good health is contagious. When leaders demonstrate healthy behavior, expect their employees to follow suit, and hold them accountable, counterproductive attitudes that can submarine organizational success go away. Lencioni calls on leaders to rise to the challenge of holding others accountable as a critical factor to organizational effectiveness.

As with so many simple ideas, execution is the key. What makes healthy organizations work is living it every day, staying true to core principles in good times and bad. That’s the leadership challenge. But after all, challenge is what drives leaders.