Why good manners are good for business

By on March 27, 2013

Rudeness may make for great TV, but politeness helps employees perform better and reduces churn, writes Philip Delves Broughton.

Manners matter. For anyone on the inside of a particular culture, they are simply assumed. Lawyers know how to deal with other lawyers, investment bankers with investment bankers, clerics with clerics. But for anyone trying to enter these worlds, manners can seem like a secret code barring entry to an elite group. They help define the lines between ‘them’ and ‘us’.

Access to certain professions is often confined to those who understand the social codes of business. It is not enough for a candidate to have the right education; they also have to possess social skills such as articulacy, the ability to work in a team, and tact.

Many business executives have been taught to eschew manners, in the sense of politeness, as a waste of time. Manners are often seen as grit in the machinery of capitalism. Those who practice or demand them are regarded as soft. The tough-talking CEO with no time for niceties has become a heroic figure. Bluntness is considered a virtue.

Television seems to love the boss who borders on the psychopathic. The chef Gordon Ramsay may now be more famous for his expletive-laden tirades against quailing underlings than he is for his food. Alan Sugar has built a media brand as the blunt, impatient boss in The Apprentice – a reflection, one assumes, of his off-camera persona. “There’s only room for one big-mouth in my organisation, and that’s me,” he has said. He seems to relish the power to fire hapless contestants.

Ryanair CEO Michael O’Leary is another boss who has made rudeness an entrepreneurial art form. He has called the Irish government “spineless retards”. He has said of the media: “Most of them hate me because I’m a loud-mouthed, arrogant, rich bullyboy. Some of them think I’m great because I’m a loud-mouthed, arrogant, rich bullyboy.” Sugar and O’Leary have each amassed fortunes worth hundreds of millions of pounds. In financial terms, their rudeness, bluntness, honesty – call it what you will – has been highly effective. The lasting consequences of this bullying culture, however, may be more than a just a few raw feelings. US professors Christine Pearson and Christine Porath, co-authors of The Cost of Bad Behavior: How incivility is damaging your business and what to do about it (Portfolio, 2009), believe incivility wreaks havoc in the business world, increasing employee dissatisfaction and “churn”, and piling on costs.

Pearson and Porath began their research by looking at incidents where workers murdered colleagues. From this extreme, they worked back to examine every kind of workplace slight to understand why some forms of incivility, such as sexual harassment, are taken seriously, while others are not. Common examples of incivility, they found, included taking credit for other people’s work, passing blame, checking e-mail during meetings, talking down to or not listening to others, making derogatory remarks, and avoiding people.

Once they began their research, examples came pouring in from every corner of the business world. There was Bob Nardelli, who served successively, and disastrously, as CEO of Home Depot and Chrysler. He was notorious for his abusive e-mails and instilling a culture of fear among staff. And Linda Wachner, CEO of clothing manufacturer Warnaco and praised by Fortune magazine as “America’s most successful businesswoman.” The New York Times reported that she was known for “demoralising employees by publicly dressing them down for missing sales and profit goals or for simply displeasing her.” A former executive told the newspaper: “The only people who survive at Warnaco are those who were abused children.” Executives churned in and out of the company, which eventually went bankrupt.

But incivility is not confined to the C-suite. Bad manners are contagious, and even trivial-seeming examples can have serious effects on morale and staff retention. Before becoming an academic, Porath worked for a large sports management and marketing company and observed first-hand how people were affected by the constant belittlement, insults and verbal digs that were considered part of the firm’s culture. Her research confirmed her experience.

After a single incident of incivility, not including anything sexual or physical, 48% of the hundreds surveyed by Pearson and Porath said they decreased their effort at work; 38% intentionally reduced the quality of their work; 80% spent time at work worrying about the incident; 66% said their performance declined; and 78% said their commitment to the firm declined. Twelve per cent said they left a firm because of uncivil treatment.

For firms already struggling to motivate and retain staff, the figures were staggering. Behaviour regarded as part of everyday office drama was actually deeply damaging. “A lot of people don’t realise what they’re doing at the time,” says Porath. “And as people move up in an organisation, they receive less and less honesty, so they have no idea how bad they are. When we reported back to doctors about how residents responded to their behavior, they said they didn’t realise they were doing anything wrong and asked why the residents were so weak.”

There are a number of reasons for rude behaviour, but by far the most common is stress. Over 60% of people blame bad behaviour on an excessive workload. They say they don’t have time to be nice. Just 4% say they do it because they like to. Some older people feel that they have a right to treat their juniors as they were treated. They’re not acting out of revenge, but through a sense that they are doing their subordinates a favour by toughening them up. It may explain the proliferation of anti-boss online chat rooms, ranging from hateboss.com to one called “arrogant, lying, fake, perverted jerk.”

The increasingly transactional nature of work has exacerbated the problem. Workers have less and less loyalty to companies, which anyway treat them as disposable parts. So there is no need to get along with colleagues and bosses who will play no role in one’s long-term future. In this context, civility can seem like “an unnecessary expenditure of resources”, according to Pearson and Porath.

Whatever the reasons for disrespect, says Porath, the perpetrator will eventually pay. If it’s Donald Trump claiming that rudeness is a form of honesty, he will eventually run into the little old lady in Atlantic City who held up his casino developments for years by refusing to sell him her modest house.

A classic case of incivility rebounding on a CEO occurred when Neal Patterson, head of US healthcare technology firm Cerner, wrote a furious e-mail to 400 employees: “We are getting less than 40 hours of work from a large number of our Kansas City-based employees. The parking lot is sparsely used at 8am; likewise at 5pm. As managers – you either do not know what your employees are doing; or you do not care. You have created expectations on the work effort which allowed this to happen inside Cerner, creating a very unhealthy environment. In either case, you have a problem and you will fix it or I will replace you.” He vowed that “hell will freeze over” before he gave out any more employee benefits and demanded the parking lot be “substantially full” at 7.30am and 6.30pm during the week. After the e-mail was leaked, Cerner’s share price fell 22% in three days. Patterson ended up sending an apology to those he had offended.

Being nice is much more successful over the long-term. Danny Meyer, the owner of some of New York’s most successful restaurants, says the effect of incivility is more immediate. He will fire rude but gifted chefs because they emit bad vibes, which he believes customers can taste in the food.

Customers who witness incivility either among employees or from employees to customers react strongly. According to Pearson and Porath, 83% described the incident to a friend; 55% took a less favourable attitude to the company; and 50% were less willing to use the company’s products or services. In other settings, the contagious effect of bad manners inhibits creativity and teamwork. Teams spend so much time dealing with the negative effect of incivility that they have little energy left to improve their firms.

Men and women, the researchers found, are equal offenders but tend to respond to incivility in different ways. Women are more likely to avoid the person who mistreated them, go outside the firm for sympathy, and plot a quiet revenge. Men tend to be more aggressive and eager to publicise their intent to get even.

For companies trying to contain incivility, Porath and Pearson recommend starting from the top. If the leaders get away with it, everyone will have a go. Hire polite people. Train managers in what to look for. And when incivility does occur, take it seriously. Don’t brush it off as an employee being over-sensitive.

The authors cite Microsoft, which had a reputation as a company that people loved to hate. Its culture was abrasive and competitive, especially early on. The tone was set by founder Bill Gates, who was aggressive to both staff and rivals as he drove his firm to the pinnacle of its industry. But as customer service became just as important as creating a good software product, Microsoft had to change.

Employees were now hired or promoted on the basis of their corporate values as much as their competencies: listening to others, being respectful, never demeaning or threatening towards colleagues, and maintaining objectivity in conflicts. Civility is now considered an important criterion within the firm’s feedback and rewards system, and employee satisfaction has greatly improved.

Pearson and Porath encourage a zero-tolerance approach to incivility. Many firms put up with rudeness in otherwise successful employees – the rainmakers and top sales people, for example. But they are exposing themselves to the higher risk of lawsuits and serious reputational damage. No-one should be let off.

When an employee leaves, the firm should be sure to interview them six months later. Few people tell the truth on the way out of the door. But with time to think, they may.

Within businesses, civility is often considered dispensable, as if it were a perk, like free coffee. Manners, however, do matter – provided they are clear, widely shared and not used as a discriminatory tool by the elite. They are more than nanny-ish demands to sit up straight and not drool. As philosophers have been saying for centuries, manners, in business and beyond, make life more tolerable. And it’s good for the bottom line.

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