AI, staff shortages and rapid change are placing significant demands on SMEs. The question is how to keep staff engaged and healthy, whilst stimulating their creativity. According to PhD candidate Desiree Meurs (Erasmus School of Social and Behavioural Sciences), informal forms of leadership – such as trust, appreciation and employee participation – play a key role in this. Her research shows that psychological safety helps prevent burnout, whilst[ko2.1] too much harmony can actually stifle innovation.
A medium-sized construction firm somewhere in the east of the country wants to chart a new course. The management decided not to determine the new strategy themselves, but to involve all staff. From the finance officer in the office to the tradesman on the building site: everyone is allowed to have a say in the direction of the company. This is just one of the examples Meurs came across during her PhD research. “The management didn’t just declare from an ivory tower: ‘This is where we’re going.’ No, they all set out together to determine where the company should be heading.”
According to her, that level of involvement made staff feel more connected to the new direction. This example illustrates her thesis. It is not about rules or procedures but about how managers interact with their staff. Trust, appreciation, participation and opportunities for development are also referred to as ‘soft controls’ or informal HRM practices.
Between the lines
Meurs recognises that protocols, appraisal interviews and job profiles are important. But the informal side of leadership is just as important. “Essentially, everything that isn’t written down, but which does ensure that you, as an employee, are more motivated.” Work is changing at breakneck speed due to AI, digitalisation and staff shortages. New systems or processes alone are therefore not enough. “You really need to involve staff in the whole process. Don’t just say: ‘AI is taking over part of the work, and that’s that.’ Discuss what’s changing and what new opportunities there are.”
Psychological safety prevents burnout
One of the key findings of her research is that a psychologically safe working environment is linked to greater well-being amongst employees. “Employees who feel safe at work are more engaged, more satisfied and less likely to take time off due to burnout.”
Too much harmony stifles innovation
Paying more attention to informal relationships is not always better. One of the most surprising findings of her research is that organisations can also go too far. “If you only socialise with one another, at some point you no longer dare to be critical of one another.” According to Meurs, this leads to a culture – particularly in relatively small companies – where everyone wants to agree with one another. That sounds pleasant, but it can actually stifle innovation. “We saw that people tend to gravitate towards consensus, which can stifle creativity.”
From factory to IT company
Prior to her PhD research, she worked with colleagues from Rotterdam University of Applied Sciences to develop an assessment tool for SMEs. This tool enables SMEs to assess how they currently apply soft controls and identify areas for improvement. To carry out this assessment, the PhD candidate conducted interviews with eleven SMEs. She also drew on data from around 200 managers who completed the assessment for her research. In addition, she analysed large European datasets to statistically test the effects on well-being and innovation.
In recent years, she has also visited numerous companies, such as a manufacturing firm and an IT firm. “People working on an assembly line have a great need for clarity. An IT professional, on the other hand, wants to know exactly what needs to be finished in two months’ time and wants to be able to organise the rest of their time themselves.” Both groups want autonomy, but to varying degrees. According to Meurs, managers must therefore always consider the context of their organisation.
Managers and staff see things differently
Employers and employees appear to agree on many issues, as revealed by the PhD candidate's interviews. A pleasant working atmosphere, opportunities for development and trust are cited by both groups. Yet there are also differences. Managers place particular emphasis on staff acting proactively and also cite their own openness and transparency as important aspects. Employees, on the other hand, are much more likely to cite receiving appreciation as important. “Managers didn’t mention giving appreciation very often, whereas employees mentioned it a great deal.” Ultimately, according to the PhD candidate, it comes down to managers listening carefully and showing interest: “That is sometimes underestimated, but it is actually very important. This research also demonstrates that.”
Desiree Meurs is a researcher at the Business Innovation Knowledge Centre at Rotterdam University of Applied Sciences (HR)
The thesis was made possible in part by a grant from HR. She was supervised by Professor Marise Born, Professor Joop Schippers and co-supervisor Dr Maaike Lycklama à Nijeholt.
- More information
Information about her defence of her thesis The Silent Force in SMEs: Managerial use, importance and effects of informal steering mechanisms could be found here.
Team Communicatie ESSB via: communications@essb.eur.nl
