Dispatches From The War On Stress

Business begins to reckon with the enormous costs of workplace angst

Mark Ostermann had been working in the Chicago office of Boston Consulting Group for less than a year when he attracted the attention of the Red Zone police. Ostermann's infraction: working too hard. He had been putting in 60-plus-hour weeks for a month and a half straight, and his colleagues were worried he was burning out. Now his bosses were stepping in to get Ostermann the help he needed. "It was a great feeling," he says. "I didn't have to complain to anyone. They were proactive in contacting me."

Pretty soon Ostermann was on an action plan to solve his little overwork problem. Two people were added to his team. Then his manager helped to balance the workload among the team members and prioritized elements of the project so that they had clear-cut goals. "It was a relief to me," Ostermann says. "It's a good check and balance to remind people that it's not all about working the most hours but about delivering to the client."

In a highly competitive, globalized world, psychological health is increasingly taking a back seat to moon-shot target-setting and a relentless focus on making the numbers. Jeffrey Pfeffer, who teaches organizational behavior at Stanford Business School, sums up the prevailing attitude at many companies: "First we're going to scare you to death and, now, give you some psychological counseling to try to make you feel better." Much more effective, says Pfeffer, is getting "rid of the source of the problem and not Band-Aiding it." Companies like Boston Consulting are starting to do just that.

Earlier this year, the French automaker, Renault, found itself doing some soul-searching following a rash of suicides at a design complex outside Paris. In the course of about five months, three engineers killed themselves. In suicide notes and conversations with their families before taking their lives, the three men voiced anxiety about unreasonable workloads, high-pressure management tactics, exhaustion, and humiliating criticism in front of colleagues during performance reviews. CEO Carlos Ghosn, famous for setting lofty targets at Nissan Motor Co. (NSANY ) (where he remains CEO), brought the same results-oriented ethos to Renault upon taking the helm in 2005. Ghosn doubled the number of models under development through 2009 to 26, in a bid to boost global sales by 800,000 and make Renault Europe's most profitable mass-market automaker.

The company acknowledges the engineers were under pressure but insists there is no direct correlation between their deaths and their working environment. Still, in March, Ghosn ordered up a plan and committed $10 million to combat workplace stress. Since then, Renault has added workers and begun training 2,100 managers on how to steer clear of negative stress and teach their subordinates to do the same. The company is also bringing in psychologists to teach 150 senior executives how to detect warning signs that people may be ready to crack, as well as "how to talk to them." Every month top management monitors the stress situation at Renault's research and development centers. Renault also plans to set up more places where employees can relax and socialize.

The suicides caused a real stir in France, where the extreme office isn't exactly commonplace. But even in the U.S., where the so-called performance culture was invented, more companies are waking up to the productivity-killing perils of stress. Even General Electric Co. (GE ) is softening some of its winners-only swagger, going so far as to bring in comedians to lighten up the workplace. And get this: GE no longer refers to low performers as "bottom 10s." Now they are called the "less effectives."

Many companies start out by helping employees repair the work-life balance. General Mills (GIS ) provides a range of personalized services while employees at headquarters work so they can spend more time recharging with their families and less time running errands on the weekends. Want your hair colored? An in-house stylist will do it. Car need an oil change? A mechanic will do it on your lunch break. "A lot of people come [to work] here because we have smart work-life programming," says Mike Peel, senior vice-president of HR and corporate services. Management consultant Booz Allen Hamilton Inc., meanwhile, is instilling a kind of corporate social contract, where everyone puts their life responsibilities on the table, and then work is arranged around those commitments. If more staff is required, they add to the team. And Draper Laboratory, an R&D shop based in Cambridge, Mass., refuses to buy BlackBerrys for its engineers. "How can anyone be creative if they are on' 24 hours a day?" asks HR Director Jeanne Benoit. "We want to keep them fresh and robust."

Ideally, companies head off stress before it becomes psychologically debilitating. IBM (IBM ) gives workers around the world an online stress test designed by Yale University; it includes questions like: Do you eat when you are stressed out? Do you have someone to discuss your problems with? Do you procrastinate? At the end, the test, which takes about 15 minutes to fill out, spits out potential action plans. These include such suggestions as setting small achievable goals, breaking large jobs into smaller chunks, and looking for humor in stressful situations.

In recent years, negative feedback—boy, you really messed that one up, Bob—has become more common, especially when managers are under pressure to hit their numbers. Yet research shows that workers then focus disproportionately on their weaknesses instead of their strengths. "Cranking up negative consequences, which seems to be the dominant view of motivation, is not really good for people's mental health," says Peter Cappelli, who teaches management at the Wharton School.


Few aspects of corporate life are more anxiety-inducing than the annual review—both for the managers handing out the bad news and the underlings on the receiving end. At Masterfoods, a division of Mars Inc. that makes candy, snacks, and pet food, managers are encouraged to have regular, honest conversations with subordinates so they aren't shocked when December rolls around.

At Goldman Sachs Group Inc. (GS ) a former GE guy named Steve Kerr encourages managers to dismantle some of the most stressful components of the review process. Numeric and alphabetic rankings, especially those that employ a grading curve, can "pit colleagues against one another," says Kerr, a senior advisor. Kerr, who worked at GE during Jack Welch's famous rank-and-yank drive, is also pushing Goldman to think differently about stretch goals. That's when a manager asks a subordinate to aim for a target that he or she knows is essentially unachievable.

Kerr says managers at GE were constantly telling him they didn't want to set their people up for failure. So now, in some cases, Goldman sets two goals—one employees can reasonably reach and one that stretches them. The point is "not to create a number of winners or losers," says Kerr, "but to set a standard of winning and then reward the winners."

By Jenna GoudreauWith Gail Edmondson and Michelle Conlin

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