"The smell of the place" Change company context on the front line and people will thrive and improve your company's bottom line

We all know that engaged employees are more productive and contribute more to the bottom line.  Their enthusiasm and motivation is also contagious.

We talk a lot about changing the people or even firing them, but perhaps we need to look at the system or environment in which they work.  Oppressive conditions create resilience; however, they don't help optimal performance. 

Leadership guru Sumantra Ghoshal calls this contextual environment " the smell of the place," and it shapes how individual actors inside a corporation are able to perform.  He notes that organizations that are about constraint, control, compliance, and contract will find that it's very difficult for people to give their best in this environment.  Organizations that value stretch, discipline, trust and support are building cultures of high performance.  Ultimately, the test of leadership quality of an organization is the context that shapes individual and team behaviors and performance.

See his inspiring 8-minute talk at the link below:

http://www.youtube.com/watch?v=UUddgE8rI0E