This latter approach, showing the financial benefits of attaining both sustainability initiatives, is far more valuable to the organization in the long run and also protects the company's most important asset, its people and the knowledge they have.
Further study of the litany of pains and costs driven by a lack of human sustainability does little to bring valuable solutions to bear on this critical problem. Instead there needs to be more of a focus on how apply transformational leadership skill sets to the parallel progress of environmental sustainability and human sustainability at the same time. The need to quantify this dual compliance strategy has been attempted and shown promising results, with the combined effects of each generating cost savings from more effective product development and recycling strategies (Hahn, Figge, Pinkse, Preuss, 2010). The payback in terms of reducing turn-over, medical costs, and increasing morale and trust that leads to higher performance are significant, and needing further research as well (Hahn, Figge, Pinkse, Preuss, 2010).
The path to accomplishing human sustainability globally has to be more focused on the economic benefits to first and less on legislating them into compliance. The reliance on transformational leadership is critically important in this regard. The following are the essential components of transformational leadership and how a focus on this aspect of changing leadership is more important that legislating compliance. The organizations who don't see the value of human sustainability in the least will forced to pay attention to them as their competitors over time gain greater competitive advantage as a result.
To attain human sustainability in organizations each of these four attributes of transformational leadership must be present, and the effects quantified and published in scorecards over time. Managers and leaders will be much more motivated to focus on these four areas if their performance is widely known by their peers and superiors.
The first of these four dimensions of transformational leadership is idealized influence, which measures the level of trust a leader is capable of attaining over time. Studies indicate that the leadership qualities including the ability to create trust, grow and keep credibility, and being accountable and transparent with peers, subordinates and superiors is critical. The human factors of sustainability are much more accomplishable in company cultures that have this attribute.
The second of the four transformational leadership attributes is inspirational motivation, which seeks to reward employees for accomplishing exceptional difficult tasks both on their own and in collaboration with others quickly. How this factor relates to human factors sustainability is that sets in motivation employees' motivation to continually learning on their own about techniques and approaches to doing their job. This is often called self-efficacy, and studies indicate that when organizations seek greater productivity from workers, giving them the necessary training and tools significantly improves morale over time. This second attribute also underscores how critical it is for companies to shift away from draconian cost cutting and the knee-jerk reduction of cutting costs and instead focusing on creating organizational cultures where motivation is not forced through fear but from the desire of employees to excel in their specific roles. This is a huge shift in perspective yet one that attains human sustainability while also creating greater trust over time.
Intellectual stimulation is the third attribute of transformational leadership. Rather than just focusing on the lack of intellectual stimulation as has been done in studies in the past that point to burn-out (Pfeffer, 2010), it is far more effective to concentrate on changing how leaders manage. This is especially the case in the areas of intellectual stimulation. To the extent any leader can nurture and guide employees to see an intersection of their personal interest and their jobs, significant gains in productivity, self-efficacy and job ownership occur over time (Hahn, Figge, Pinkse, Preuss, 2010).
Creativity and innovation is the third attribute or characteristic of transformational leadership and has also been shown to increase the long-term profitability and innovation of companies. Compare the innovations of Apple with their latest two and most innovative products the consumer electronics industry has seen in decades, the iPad and the iPhone 4G. These products would have never been invented and brought to market without transformational leadership styles dominating the Apple culture. The heavy reliance on innovation within the Apple culture also necessitates human sustainability at the highest levels. The ideas of its employees are what transforms the company. Additional research needs to be done to evaluate the extent to which human sustainability, when treated as a best practice and enabled through transformational leadership, fosters greater innovation over time. Certainly if employees are treated as expendable and being scrutinized as expenses, there will be little to no innovation occurring. This is perhaps the greatest hidden cost of not having human sustainability in organizations. Consider how many excellent products are never designed and fully developed due to a lack of human sustainability and as a result, a lack of trust as well. These are the most egregious losses from not having human sustainability initiates in place and setting a strong foundation for them using transformational leadership as its catalyst. Imagine how many billions of dollars are being lost by companies who take a short-sighted, draconian view of their employees and as a result miss out on innovations that could transform their organizations. This is a very large loss, one that is incalculable.
The last of the four attributes of transformational leadership is individualized consideration including the development of customized development plans. This has a very significant effect in getting employees more focused on their contributions to productivity and also promotes greater task ownership as well. This strategy in teaching is called scaffolding (Najjar, 2008) and has been used for decades in organizations seeking to turn themselves around and grow.
It is relatively easy to create a litany of why human sustainability is bad, yet much more challenging to define a strategy to overcome it and create positive growth (Pfeffer, 2010). The intent of this analysis is to show that legislating human sustainability will certainly fail, and to ignore it completely in these turbulent economic times is to risk a company. Organizations need to wake up and see that attaining sustainability form an environment standpoint can be attained in parallel with human sustainability (Hahn, Figge, Pinkse, Preuss, 2010). This isn't being kind or altruistic, it's being smart about taking care of the most critical resources a company has, which are its people.
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