HOW SELF-AWARENESS DELIVERS BETTER SHAREHOLDER RETURNS
Companies with a higher rate of return (ROR) for shareholders also employ professionals who exhibit higher levels of self-awareness, according to Korn Ferry research.
“Self-awareness can directly translate into better choices, and result in more fulfilling careers,” said Joy Hazucha, global vice president of the Korn Ferry Institute.
“On the other hand, those with low self-awareness tend to scramble the messages they receive concerning improvement, interpreting them as a threat rather than an opportunity.
“They often have an ‘I am what I am’ mentality and continue doing things the way they always have.”
The Korn Ferry Institute analysed almost 7000 self-assessments from professionals at 486 publicly traded companies to identify the “blind spots” in individuals’ leadership characteristics.
A blind spot is defined as a skill that the professional counted among his or her strengths, when co-workers cited that same skill as one of the professional’s weaknesses.
The frequency of such blind spots was then gauged against the ROR of those companies’ stock, and the analysis demonstrated that, on average:
- Poorly performing companies’ professionals had 20 per cent more blind spots than those working at financially strong companies.
- Poor-performing companies’ professionals were 79 per cent more likely to have low overall self-awareness than those at firms with robust ROR.
“Poorly performing companies’ professionals had 20 per cent more blind spots than those working at financially strong companies”
“This confirms what HR leaders suspected: that better self-awareness helps job performance,” said Hazucha.
“It is a lever to help business leaders put their immediate tasks aside once in a awhile to get feedback.”
Stephen Johnston, senior client partner at Korn Ferry Australasia, also observed that the implications of a self-aware organisation can be profound.
“When we understand our strengths, weaknesses, blind spots and the causes of our feelings and moods, our conversations tend to be much more ‘honest’ and our interpersonal interactions are much more productive,” he said.
“I don’t think you can achieve high performance in teams and organisations, when there are insufficient mechanisms devoted to raising the overall level of self-awareness.”
How to improve self-awareness
A person’s level of self-awareness can be increased through 360-degree performance appraisals paired with effective coaching, according to Hazucha, who said that this in turn drives improved performance and greater work satisfaction.
“Feedback helps leaders to identify their blind spots,” she said.
“We have known that feedback was important for personal improvement, but this shows that it also pays off in the organisation’s performance.
“A collective focus on personal improvement leads to improvements in the organisation.”
“This confirms what HR leaders suspected: that better self-awareness helps job performance”
In contexts where feedback is infrequent, Hazucha said it is helpful to start with a formal process, and also to start at the top so that leaders can start as role models for their own development, and then support others’ development.
“Feedback is especially infrequent at the top of organisations: people are more willing to say that a vassal has no clothes than to give the same message to an emperor or his court,” she said.
Johnston said that developing self-awareness also comes from doing something with the feedback one receives.
“Mindfulness mediation and journaling are useful techniques to help us reflect on the feedback we receive and focus on what we need to do in order to gain real benefit from the feedback,” he said.
Hazucha also said that a focus only on results with no time for reflection or feedback is likely to result in poor performance.
“Building regular feedback into the culture will help the organisation to be more successful,” she said.
This culture of feedback can be applied to both project debriefs (ie, what did we do well? What should we do differently?) and people (ie, what did I do well? What can I improve?).
An environment of fear and threats (such as. layoffs or other negative consequences) also decreases feedback, Hazucha added.